As we reach the final weeks of 2011 and begin to look back at the year that was, by any standards, its been a wild, wacky year. Robert Young, Chief Economist with the American Farm Bureau Federation
Young: You think about the flooding situation that we started out with on the Mississippi, then on the Missouri, hurricane up the east coast, drought in Texas, so yeah, it’s been a wild and wacky year, if you will.
SFN: we’ve kind of gotten accustomed over the years of the general economy and the farm economy not necessarily running parallel. And, I think right now we’re kind of grateful that they’re not.
Young: Well, we are, you know the ag economy at this point in time isn’t in bad shape at all, certainly those farmers in those areas we’ve already talked about have had their challenge, and not to say that individual producers aren’t facing their own individual challenges, but the sector as a whole isn’t doing too bad at all. You know, we’re going to have record farm income this year, and with the income in 2012 being up there, maybe not a record, but staying reasonably strong, as well.”
SFN: What are you attributing those record numbers to?
Young: Well, you know we’ve just got very strong demand for product, we also came into the year with very tight supplies of corn and beans, maybe not quite so much wheat side, and we’re going to go into 2012 with very tight supplies of corn and beans and maybe not quite so much corn side. And cotton side also not too bad. You know, I just thing very strong demand for product as well, both here at home as well as overseas, and that’s not just for grain and oilseeds but for animal proteins as well.”
SFN: And speaking of animal proteins, something I think we’re going to see a big shift in in the next 6 to 12 months is cattle:
Young: We are. And I think we’re going to see noticeably higher cattle prices and beef prices in the grocery store as well. You know, you can’t just pull the herd back as far as we’ve pulled it back, and then when you decide when you want to get to an expansion place again, those cows only come from one place, you know, and so we’re going to have to hold those animals back and not send them through to be slaughtered, when you do that, again, it just tightens up the beef supplies that much more.”