In September, 75% of agricultural economists expressed concerns about an impending recession in the sector. October’s Ag Economists’ Monthly Monitor showed a slight improvement, with optimism driven by increased U.S. corn exports and potential cattle herd rebuilding. However, economists remain wary of the impact of the upcoming election.
As the Midwest harvest concludes, corn and wheat prices have seen a small rebound, though soybean prices remain bleak. The survey indicated economists’ cautious optimism compared to last year, despite the challenging economic landscape. Key concerns for livestock prices over the next six months include herd size, the general economy, consumer demand, disease threats, and international developments, especially in China. Economists predict most beef producers will begin herd rebuilding in 2026, though weather and high heifer prices remain obstacles.
Interest rates also pose a significant challenge. Nearly half of economists believe farm interest rates need to drop by 2% to achieve stability, but rates continue to climb, driven by inflation fears. Suderman, a commodities economist, warns that despite the Federal Reserve’s influence, rising short-term rates signal inflation concerns may intensify.
Ahead of the election, economists expressed mixed views on candidate impacts, with 53% favoring Trump for inflation control and 61% seeing him as more supportive of farm policy. However, Harris was preferred by 53% for biofuel policy, amid concerns over potential production cuts if the 45Z biofuel standard isn’t clarified soon. In addition, many economists expect a new farm bill by 2025, though 21% predict a delay to 2026.
Overall, October’s Monthly Monitor revealed cautious optimism, tempered by inflation, high input costs, weather unpredictability, and electoral outcomes.
