China Key to Ag Profitability in 2021 — Economists

Though domestic supplies have helped drive the latest rally in the grain markets, demand from China as that nation continues to rebuild its hog herd will likely be the major fundamental driver of prices and, in turn, revenue for producers in 2021, American Farm Bureau Federation (AFBF) economists said at the organization’s convention this week. China’s herd cull as a result of African Swine Fever cut that nation’s total pork output by as much as 30%, and restoring those numbers to previous levels will require increasing feed grains, a large portion of which will be sought on the export market. The same influence is likely for protein exports; U.S. beef, pork and poultry producers are likely to see continued strong demand until China’s hog numbers are restored. For livestock producers in parts of the U.S., drought will also be a “much bigger deal” in 2021 if pasture and forage conditions continue to decline in places like Texas and Oklahoma. See more from the economists’ discussion.