Zwicker sees similarities to 1980s

One commodity analyst sees similarities between what farmers experienced in the early 1980s and what is happening now.

Dan Zwicker of Zwicker Consulting, based in Texas, is a little nervous about this.

“When you get interest rates climbing higher and you get the dollar going higher, we start losing export demand,” Zwicker told The Central Illinois Farm Network last week.

While this year is not considered a short crop, it is a lot shorter than what we thought it would be a year ago.

“Prices did rally sharply because of the Ukraine war and a whole bunch of other factors,” said Zwicker. “Anytime you have fairly lofty prices like we’ve experienced, the next year usually has a tendency to be disappointing.”

The last two years in a row we’ve had very typical seasonal price patterns where markets bottomed out in the fall during harvest and gradually worked higher into the spring planting season.

“I’m a little worried that there’s a chance that may not occur and depending on what goes on in South America, we may have price strength earlier like in January or February,” added Zwicker.

Zwicker was the guest on Friday’s CIFN Midday Update.