Prices, trade dominate discussion
COAL CITY – Low crop prices and trade issues dominated the discussion during a fall market outlook meeting hosted by Bank of Pontiac in Coal City Wednesday night.
While everyone is looking for a sign that the trade war with China is over, behind the scenes, it’s all about intellectual property rights, according to Roy Plote with L&M Commodities.
“It is always sad that we have to be the whipping boy in agriculture,” Plote noted. “We are an easy target for tariffs on our products because it is a big part of our market.”
Plote feels our country will be in this trade battle for some time, but the market could bounce back significantly if anything changes. Times are also tough for the livestock industry with cows bringing 30 or 40 cents per pound and calves aren’t worth much because of an excess supply of lesser-quality beef.
“The higher quality beef is holding up in value. We’ve seen some up moves,” Plote said.
The producer getting hurt on all sides is the one getting rid of milk and calves at a bad price. Plote does see a positive demand outlook for beef in the future but is more uncertain about hogs. Many thought we would see a bump due to swine flu but there was a good pig crop. We simply have too much pork in Plote’s opinion.
Merrill Crowley with Midwest Market Solutions in Watseka does not see anything at the moment that could move prices lower than what we have already seen for lows this year.
“Both corn and beans have head and shoulders bottoms in them. If those pan out like they should, then they’re projecting March corn to get up somewhere in the neighborhood of $4.00-4.05 and they’re projecting beans to get up to around $10.12 roughly,” Crowley explained.
This could provide some new crop pricing opportunities for farmers in 2019. If a weather problem arises somewhere in the world, everything could change.
“Can you imagine what would happen right now with China’s reliance on Brazil if we saw Brazil suddenly turn dry?”