This Agweb article tied to the American Farm Bureau Federation's annual meeting shows the complexities of farming. Corn farmers in particular are looking to a bright future based on ethanol production expanding. But livestock producers, particularly pork, are facing red ink. Why--because hogs eat corn. The "iron triangle" is at work, as Keith Collins, USDA's chief economist, talks to the meeting and representatives of the universities and other farm organizations are heard from.
Farm groups are concerned with international trade, the Doha round of trade negotiations, immigration, the new farm bill, air quality, and animal protection (against the last two :-) ).
This year has seen a run-up in corn prices. Indeed, I saw one summary that said that corn was the "commodity" with the largest percent increase in 2006. Don't know what price measure was used. Farmers should be used to this--there was a big price increase in 1996, I believe. And then it went to hell again.
Meanwhile, this morning's news has John Deere's stock prices, up 40+% last year, looking good for the future (again based on rosy prices for corn, etc.). But oil prices are falling again, reaching new lows. That means less impetus for ethanol, lower prices for corn, higher profits for pork, and different pressures on politicians doing the new farm bill.
Being a cynic, I think I'll plan to sell John Deere short.
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