From trade tensions to supply concerns, farmers face daunting challenges and more uncertainty heading into 2019. But farmers are cautiously optimistic about the outlook despite predictions of more pain ahead.
Low commodity prices and trade disputes have led to tough times for farmers and caused soybean and pork operations to lose money. The difficult conditions in the farm sector also have driven more dairy farmers out of business.
"If you look at the heartland of the U.S., which is largely propped up by corn, soybeans and wheat, we're going into year five of a pretty difficult time," said Curt Hudnutt, executive vice president of Rabo AgriFinance and head of rural business in North America for Rabobank. "So we expect there to be challenges in 2019."
Barring any major breakthrough on trade, economists and bankers are not hopeful about a significant upturn in farm income in 2019. Farmers have faced several years of lackluster profits, and supply concerns could keep prices at depressed levels in the new year.
The U.S.-China trade war resulted in Beijing slapping retaliatory tariffs on thousands of U.S. goods, including soy, corn, beef, pork, tree nuts and dairy products. China also targeted other industries, including chemicals and machinery.