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Jan. 10, 2011 Source: Agri Marketing magazine While the Agri Marketing editors have no inside knowledge of any of the following predictions, we thought it would be fun to speculate on what some of the 2010 headlines may be. 1. The fragile U.S. economic recovery is slowed by record high energy costs. Oil tops out at $125/barrel and gas reaches $4.25/gallon at the pump. U.S. GDP growth, originally forecast at 2.4%, is a disappointing 1.2%. Unemployment, currently at 9.4%, drops to 9.1% at the end of the year. 2. Banks begin the year with an estimated 1,000,000 foreclosed properties on their books. Rather than dumping them on the market and further deflating real estate and home prices, they slowly release them, which continues to put a lid on prices. To provide support to the banks for taking this action, the Fed maintains its policy of increasing the money supply and provides an additional half trillion of bonds. 3. Inflation is back and jumps 2% for the year. The ending prime rate rises from its current level of 3.25% to 4.5%. 4. Ag commodity prices remain extremely volatile. Corn trades in the range of $7.00 to $4.25/bu. Soybeans trade from $14.95 to $9.50/bu. Wheat (HRW) $9 to $6.50/bu. Cotton $145 to $110. Fed cattle $115 to $85/hwt, hogs $85 to $70. Dairy prices show some recovery and milk is up 15% for the year. 5. Final planted corn acres are 90 million and planted soybean acres are 80 million. 6. The major financial indexes are up 5%. 7. 40hp tractor sales are even with last year, mid- and high-range hp tractors are up 5% and 4WD tractor sales fall 20%. Combine sales dip 10%. 8. Net farm income falls 10%. 9. At least one of the major companies in each of the ag sectors (seed/traits, crop protection, machinery, equipment, animal health, feed, livestock handling, credit, etc.) changes its marketing communications agency. 10. Another major dispute over the ownership/licensing of crop input traits erupts. 11. Consolidation among crop input retailers continues and, in fact, escalates, highlighted by two large co-ops who merge. 12. Now focusing on its re-election, the Obama Administration moves toward the center on a number of issues, including a moderation on some of EPA's policies and proposed rules. Tweet |
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