What is in this article?:
"One of the challenges we in agriculture face, as people understand less and less about what we do, is maintaining our freedom to operate, and being able to operate as advancing science suggests is the most productive and efficient," says John Anderson, deputy senior economist for the American Farm Bureau Federation. “All this is bound up in the idea of social license: Do people understand what we do? And do they trust us enough to let us do it?"
TERRY BEASLEY, from left, Amory, Miss.; Tommy Moody, Belmont, Miss.; Don Thompson, Golden, Miss.; and Danny Dilworth, Rienzi, Miss., were among those attending the annual Mississippi State University Producer Advisory Council meeting for north Mississippi.
Challenges from environmental regulations
Environmental regulations: “There will continue to be ongoing challenges to agriculture from environmental regulations — The Clean Water Act, Clean Air Act, Endangered Species Act, etc.,” Anderson says.
In the western and mountain states, the ESA is a hugely important issue for agriculture. In Texas, for example, they can tell you chapter and verse about how much the prairie chicken ESA listing will cost them in terms of agricultural production.
“It’s important to note that, while issues in the West, in Texas, or elsewhere may not directly affect Mid-South agriculture, we need to consider the impact of those models being applied elsewhere.
“I think we’re going to need to devote a lot more attention to the Clean Water Act. For example, what would nutrient standards for the Chesapeake Bay mean for agriculture if the EPA applied the same model to the Mississippi River watershed? That would very directly affect farmers here.
“Implementation of regulations related to the environment is going to become more important to agriculture, and is going to be something we’ll spend a lot of time on in agricultural policy discussions.”
Mid-term elections: Overhanging all these issues, Anderson says, are this year’s mid-term elections. “Many, or all, of these issues may get subsumed by the back-and-forth arguing that goes on relative to the elections. Everything that happens this year in Congress is going to be against the backdrop of these elections, and that will dictate a lot of what gets done or doesn’t get done.”
Agricultural outlook: “I think the outlook for agriculture, in general, is very strong,” Anderson says. “That’s particularly true for livestock in 2014 — there’s every reason to expect overall strong performance in that sector, thanks to lower feed prices and good consumer demand for livestock products.
“China continues to be a big deal for agriculture, more so now that they’re reaching a point where their consumers have more money to spend on higher quality food products. For the livestock sector, that’s a phenomenally supportive development.”
On the crops side, Anderson says, lower commodity prices are likely. “I think we’ll continue to see pressure building on major row crop prices, particularly grains. This is a function of several years of really strong demand, and now supply adjustments have been made.
“That’s how commodity markets work — when you get strong prices, you attract resources into that sector, and supply catches up. We’re kind of at the end of that process now.”
But Anderson says, “I’m finding myself less bearish about grain markets than many other analysts. It’s very early in the year, and there is still a lot of uncertainty about the grain market outlook.
“We’ve already got some production problems developing: the Southern Plains wheat crop is not looking that good, and if we end up with a short crop, that could set a firm tone for grain markets in general. We’ve had a lot of dry weather out west; hopefully, we won’t see that spread, but it’s something to keep an eye on.”
Although it hasn’t got that much attention in agriculture, Anderson says the political unrest and violence in Ukraine need to be watched.
“Ukraine is an important player in both the wheat and corn markets. If their situation destabilizes and they’re basically taken out of export markets, that would leave a hole. It may not be a huge hole, but it would be one that we hadn’t expected to see, and it could affect those markets.”