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The outlook for the United States farm economy depends on the implementation of new trade agreements and the evolution of animal and human disease outbreaks.
The University of Missouri Food and Agricultural Policy Research Institute reports that while net farm income increases in 2020, under a baseline assumption of continued trade friction with China, other indicators of the health of the farm economy are not as positive. Projections show that with an assumed return to normal planting and growing weather in 2020, there will be an increase in projected area, yields and supplies and lower prices for corn and soybeans in the 2020/21 marketing year.
With trend yields, 2020 corn production increases to 15 billion bushels, putting downward pressure on prices, which are projected to average $3.57 per bushel. With soybeans, an increase in production drops prices to $8.48 per bushel, before considering the possible impacts of the “Phase 1” trade agreement. Additionally, potential African swine fever impacts, along with the impact of COVID-19, could change the farm economy in 2020, as well.
