Ag outlook 2021
With all the problems 2020 brought, we’re all wondering what’s in store for 2021. The coronavirus brought billions of dollars of aid to American farmers and ranchers, but producers shouldn’t count on more federal payments to aid farm income. However, some analysts say the agricultural outlook for this year has some positivity, especially for grain producers.
Tanner Ehmke is the manager of CoBank’s Knowledge Exchange Division. He says there will be more opportunities for grain marketing and international exports.
"We’re heading into the year with contract ties on soybeans. We’re assuming that is going to carry forward for the most of next year where you’ve got the Chinese rebuilding their hog herd, they’ve lost significant crops in that part of the world due to typhoons and flooding. You’ve got La Nina tightening supplies potentially even more down in South America with Brazilian and Argentine yields dropping," says Ehmke. "And so, this is all creating an export opportunity for us."
It’s not a great story for grain end users. For livestock producers, poultry feeders and ethanol producers, it’s going to be a higher-cost environment which will cut into margins. However, there may be new opportunities on the horizon. In light of COVID-19, there have been changes in consumer trends.
"Especially with meat and in dairy products, there may be new marketing opportunities that may emerge," he says. "With the changing U.S. economy, we have a different type of consumer that’s buying more from retail and less from food service. So, if you’re in animal protein and dairy, there could be opportunities here that didn’t exist before."