Whether you’re on the farm or at your desk, understanding the economy is crucial for smart farming choices. Changing global markets, shifting weather patterns, and new policies all impact agriculture. Staying updated on economic trends can greatly affect your farming business. Dan Basse, an agricultural economist at AgResource Company, shares what farmers should focus on this fall and winter.
Looking ahead to the fall and winter seasons, Basse pointed out that several external factors are at play, including the upcoming U.S. elections. “This year is compounded by the elections in the U.S., and the policies that emerge from them will be critical for agriculture,” he noted. He emphasized the importance of understanding both policy and weather, which are the two biggest variables for ag economists. “Getting past the election will bring clarity on policy, and then we can turn our attention to South American weather to make better-informed market decisions.”
Basse also touched on the shift in global agricultural exports. “The world is becoming somewhat split,” he said, referencing the BRIC countries (Brazil, Russia, India, and China) and their increasing influence. “The United States is becoming more isolated as a trading entity in agriculture. Both a Trump or Harris administration would need to focus on breaking up the BRIC alliance, which currently has more global GDP than the G7.”
Another key focus for U.S. agriculture is the Farm Bill, which Basse predicts will probably be postponed until 2025. “There aren’t enough legislative days left this year,” he said. “Farmers need Washington to step up with higher price supports and increased revenue insurance to cover their costs. With prices for grains low and yields high, farmers are still struggling.”
For Wisconsin’s powerhouse dairy industry, Basse struck a cautiously optimistic tone. “Dairy is in a fairly good position, and global demand remains strong,” he said. “I think milk prices will range from $19 to $26 per hundredweight, which is favorable, especially with low feed costs.” Basse is particularly bullish on butterfat demand, citing strong opportunities for U.S. exports in Southeast Asia.
Despite the challenges, Basse sees light at the end of the tunnel. “Agriculture operates in cycles, so we shouldn’t let ourselves get too discouraged when prices dip,” he advised. He believes that volatility in global weather patterns could present opportunities for U.S. farmers. “Volatility is something that’s going to be with us in agriculture. How you navigate that and the market decisions you make are key to your success.”
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