Has the farm economy bottomed out?
Iowa State University Extension and Outreach vice president Jason Henderson tells Brownfield it’s close.
“I think right now we’re really close to a bottom in the farm economy. It’s gone from about $200 billion on a real basis down to about $130 to $140 billion. We’ve seen corn prices come up a little bit recently, a good time to price markets given some of the disruptions we’ve had in Brazil.”
He says demand will be the driver, but there’s a lot of uncertainty.
“On the demand side, we tend to think about ag commodities going overseas. And so right now we’re in a trade deficit, the first time we’ve had that in decades. And so I think there’s going to be some weakness in international markets, tariffs are going to weaken the market as well, depending on how they retaliate.”
Henderson says with so many questions around exports, the U.S. needs to look domestically for new and expanding markets.
“Whether that’s food products, whether that’s fuel products, whether its other types of products that are bio-based that people are looking for as well. Whether it’s plastics or doing different things.”
He says biofuels like sustainable aviation fuel are a wild card for demand.
Brownfield interviewed Henderson at the Iowa Farm Bureau Ag Market Outlook Meeting in Forest City earlier this month
