From the Ground Up: Producers planning for more ups and downs in 2021
BRYAN, Texas (KBTX) - The peaks and valleys of agricultural markets may have been steeper than year’s past, but farmers and ranchers have been able to capitalize on some of those challenges.
“We couldn’t get animals processed, horrible losses for meat industry, what was that going to do for corn for feed down the road?” Dr Mark Welch, an extension economist with the Texas A&M Agrilife Extension recalled of last year. “It was devastating the livestock industry? There were so many factors there early that were culminating early summer, and then what a turnaround based on weather, and then the degree to which the global economy began to respond and get better.”
Welch says farmers and ranchers have had a tug-of-war between supply and demand over the past year.
“Some of the corn supply came up because of that we didn’t really anticipate, but then the impact of the weather, the fact that china’s appetite for corn and their level of imports, then to a large degree offsets the declines we saw in the other use categories, particularly fuel, we saw a surge then in corn going for exports,” Welch said.
Weather, pandemics, and politics not only affect the present, but drive prices for the future, and the future demands more grains.
“I think the dynamics of what farmers decide to plant, combined with how cooperative mother nature is in giving us adequate growing conditions not only in the U.S. but globally, these high prices are providing high incentives for increased acreage for any Ag producer around the world that is equipped to respond.”
We may need a little luck, but Welch says producers should be prepared for anything.
“We didn’t see this one coming, the next big one, we didn’t see coming either. But what can we do to provide a stable sustainable environment that allows for the food and fiber production systems that come from American agriculture to meet that need and demand of whatever it might be, and that’s what we’re trying to build.”
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