11 Questions Facing Agriculture in 2020

For many of us, the new year is a time to reflect on the year (or decade) behind us and consider what may lie ahead of us. What will 2020 have in store? Well, that is a daunting – if not impossible – question to answer in January. However, that doesn’t mean we are completely helpless in thinking about the significant issues ahead. In this week’s post, we outline eleven biggest issues facing agriculture in 2020.

1. Farm Income

From the Trade War to MFP and commodity markets, farm income will have several moving pieces in 2020. It is no secret that ad-hoc MFP payments in 2018 and 2019 have propped up farm incomes, but no such program is currently in play for 2020.

2. Farm Finances

As we noted in 2019, the challenges in the farm economy go deeper than farm income. Specifically, the trends toward higher debt and lower working capital reveals an unfavorable trend on producers’ balance sheets. Will farm balance sheets stabilize in 2020?

3. African Swine Fever

Was 2019 the worst of African Swine Fever (ASF), or the tip of the iceberg? Conversations in 2020 will likely swing from opportunities (“will U.S. exports surge to fill a void in the market?”) to risks (“what will happen to demand for grain if Europe and/or the U.S. face an outbreak?”).

4. Trade War

There is, again, hope for a quick resolution to the Trade War. Mark January 15th on your calendars as this is when China and the U.S. are set to sign the Phase 1 agreement. At stake for agriculture appears to be a surge in China’s purchase of U.S. agricultural goods. It is hard to read what been written/tweeted about the situation and not feel optimistic and skeptical. Stay tuned.

5. Drama in D.C.

USMCA. Impeachment. Tensions in the Middle East. Farm workforce modernization legislation. The EPA and RFS. Oh, and an election. There is a lot for lawmakers to get themselves distracted by in 2020. The biggest questions for agriculture – at least at this point – surround USMCA and the Phase 1 trade deal getting across the finish line. We also would not be surprised if farm policy and MFP get attention during the plethora of upcoming political debates.

6. U.S. Economy

Will the U.S. economy continue its lackluster yet long-lived economic expansion in 2020?

7. Global Unrest

The new year has seemingly been met with amplified global tension. A lack of progress in negotiations between the U.S. and North Korea has turned into new threats.  Even more complicating, a U.S. airstrike in Iraq killed a high-ranking Iranian military official, which led to even more threats.

8. Acreage Debate

There is always speculation surrounding U.S. corn and soybean acreage, but this year’s debate will likely get even more attention. The debate got a kickstart last summer when the possibility of 100 million corn acres was thrown out. In reality, the conversations – regardless of the actual numerical outcome- will be likely be focused on “too many acres.”

9. 2020 Weather

A perineal question for agriculture is what the weather might have in store for 2020. It is hard to believe, but some producers – especially in Western Kansas and Texas – are facing dry conditions. Early indications imply El Niño and La Niña aren’t likely to make an appearance during the 2020 growing season as forecasts anticipate neutral conditions through summer.

10. Ending Stocks

Mother nature took a dent out of the massive soybean stocks in 2019. How will U.S. (and global) grain production and ending stocks fare in 2020?

11. Good Times Ahead for U.S. Livestock Producers?

Livestock producers will be carefully watching for the details of the Phase 1 trade deal with China, especially given China’s challenges in responding to ASF.

11.5.  But really, what are those drones doing?

On a lighter note, we will be curious to see if 2020 brings resolution to what those night-flying drones in Colorado and Nebraska are up to.

Wrapping it Up

As you make plans for 2020, it is important to keep these uncertainties – and any others you might be facing- in mind. The challenge for decision-making is how to evaluate and think critically about the uncertainties. This is a topic that we have thought a lot about over the last several months. In 2020, we will be talking, writing, and thinking a lot about how decision-makers can navigate uncertainties in a thoughtful, strategic process. In future posts, we’ll be sharing more details and provide opportunities for you to be apart of this project.

Click here to subscribe to AEI’s Weekly Insights email and receive our free, in-depth articles in your inbox every Monday morning.

You can also click here to visit the archive of articles – hundreds of them – and to browse by topic. We hope you will continue the conversation with us on Twitter and Facebook.

Source: David Widmar, Agricultural Economic Insights

Recent News

Robust Soybean Export Forecast, While Countries “Bulk Up” Their Food Supplies

Mark Ash and Dana Golden explained in this month’s Oil Crops Outlook, from USDA’s Economic Research Service (ERS), that, “Despite an unchanged yield, USDA pegs the 2020/21 U.S. soybean crop down by 45 million bushels this month to 4.268 billion as the sown acreage is revised down by 731,000 acres to 83.1 million. With strong sales to China, USDA raises its forecast of […]

Identifying Fall-emerging Weeds

2020 Update: I believe marestail will be a problem this fall and require an alternate herbicide as the majority of marestail in eastern Nebraska is resistant to glyphosate and ALS-inhibiting herbicides. Amit Jhala As the 2020 corn and soybean harvest begins to wind down, we would like to encourage growers to take a proactive approach to […]

Cover Crop Considerations When Dealing With Soybean Cyst Nematode

With the soybeans being harvested a little earlier than usual this year, some producers are finding themselves making management decisions which often include the use of cover crops. There are a lot of agronomic benefits for planting cover crops (Figure 1) such as soil health, soil erosion control, weed reduction, animal feed, and nutrient recycling. […]

Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now