Hello everybody out there in farm country. This radio commentary is brought to you by the National Corn Growers Association, CropLife America, and Renewable Fuels Association. They are all friends, supporters, and allies of a healthy farm economy and prosperous rural America. Thank you.
And now for today’s commentary —
This weekend I will be on my farm in Illinois. When I booked my flight, I thought we might be planting corn. Not likely – too much rain.
At this moment I am looking at the latest U.S. Dept of Agriculture projections for crop carry over after harvesting this fall. Ending stocks of corn, soybeans, wheat, and cotton are all projected to be at record or near record levels. It is shocking to look at these charts – especially soybean carry over – almost 900 million bushels.
Farms today are looking at low prices. Unless weather problems cut production, the global harvest prices will not respond. Perhaps the only hope rests on trade to elevate demand. We need buyers for surplus farm commodities.
I think President Trump’s tariffs and trade disputes can deliver positive results, but we are paying a short-term price.
It is encouraging that there are positive vibes coming from our trade negations with China. We have an election coming up in 2020 and you can be assured President Trump needs a deal he can tweet about. Keep in mind that China’s economy is suffering. The tariffs have taken a toll. In the first quarter of 2019, China’s imports increased 1.4% and exports dropped 4.8%. With African Swine Fever Chinese pork imports will explode. This year projections are for a 41% surge.
Now that I mention ASF I compliment the National Pork Producers Council for cancelling the annual trade show this June. Too much risk of bringing swine fever to our shores. The right decision.
Trade talks have been going on this week with Japan our fourth largest foreign market – Japan bought $13 billion worth of Ag products last year. Our U.S. Trade Representative Robert Lighthizer has been leading those negotiations. We have been losing some of the Japanese market because with the Trans-Pacific Partnership trade agreement in business now, without us those members have an advantage. I expect the negotiations with Japan to advance quickly and we can reclaim our priority position with Japan.
Here is another high priority for US Agriculture and North America – We need to ratify the US-Mexico-Canada agreement and lift our tariffs on Canada and Mexico.
Farm country wants and needs to get something done. Put the heat on our government representatives. Can’t wait to get to the farm…
Until next week, this John Block reporting from Washington, D.C. If you would like to review my radio shows going back more than 20 years, just go on-line to www.johnblockreports.com.