Economists From AgResources Company Believes 2021 Will Be a Banner Year

Friday, March 19th, 2021 -- 8:07 AM

(Wisconsin Ag Connection) One of the nation's leading farm economists thinks that the agricultural landscape in America today feels a lot like the roaring 20s of one hundred years ago.

According to the Wisconsin Ag Connection, Dan Basse of AgResources Company in Chicago presented his analysis of the industry during the Professional Dairy Producers of Wisconsin annual business conference in Wisconsin Dells on Thursday.

Despite the year-long pandemic, he believes 2021 will be a banner year for most producers, mainly because the demand for food products from Chinese buyers is escalating as the average household income in that country continues to rise.

As a result, higher feed prices will eventually impact the dairy industry in a positive manner. He explained that when the price of corn goes up, it typically forces dairy producers to cull lower producing cows to save money on feed costs.

He foresees milk prices peaking during the third and fourth quarters of the year at around $19.50 per hundredweight, and going even higher in 2022.  In addition to China's larger appetite for more and better food, Basse says the continuous outbreak of African Swine Fever in that country is another factor impacting the worldwide markets.

He explained that ASF restrictions are forcing domestic hog producers in China to feed more corn in lieu of food waste from restaurants, which would theoretically drive up export demands from the United States and many other top corn growing nations.

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