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Trade, Tariffs, & the Ag Economy

Trade, Tariffs, & the Ag Economy. May 12, 2018 Chad Hart Associate Professor/Crop Marketing Specialist chart@iastate.edu 515-294-9911. Net Farm Income. Source: USDA. Farm Debt. Source: Federal Reserve. Ag Economic Summary.

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Trade, Tariffs, & the Ag Economy

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  1. Trade, Tariffs, & the Ag Economy May 12, 2018 Chad Hart Associate Professor/Crop Marketing Specialist chart@iastate.edu 515-294-9911

  2. Net Farm Income Source: USDA

  3. Farm Debt Source: Federal Reserve

  4. Ag Economic Summary • Agricultural production and consumption has grown rapidly over the past several years. • But when production exceeds consumption, prices fall. • Crop revenues peaked in 2012-13, while livestock revenues crested in 2014-15, leading to record farm incomes. • Since then net farm income has been cut in half. • While the percentage loss in substantial, net farm income remains above levels from the early 2000’s. • Farmers and ranchers have partially compensated for the loss in income by taking on higher debt loads. • Farm and ranch balance sheets are eroding and financial stress is building for some producers, but the financial issues are not as severe as during the 1980’s. • If agricultural prices slowly improve (as projected), the squeeze on farm finances will improve as well. But for some producers, the squeeze may be too much.

  5. Iowa’s Economy as an Example

  6. Links to Manufacturing Farm Machinery

  7. Links to Government Dept. of Ag.

  8. Links to Real Estate Farm Leases

  9. Links to Finance and Insurance Crop Insurance

  10. Links to the Rest of the Economy

  11. Why do U.S. farmers need export markets? • That’s where the customers are • That’s where the economic growth is • That’s where the consumption growth is • We produce surpluses • We only eat high on the hog • Exports are crucial to farm income

  12. 96% of the world’s population lives outside the US Source: CIA World Factbook

  13. Population growth 2017 to 2050 Source: World Bank

  14. Economic growth rates Source: CIA World Factbook

  15. Top ten US ag export markets, 2016 Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

  16. Top 10 ag exporting states, 2016 Source: USDA Economic Research Service, “State Export Data”

  17. Beef Export Shifts Source: USDA-FAS

  18. Pork Export Shifts Source: USDA-FAS

  19. Sorghum Export Shifts Source: USDA-FAS

  20. Soybean Export Shifts Source: USDA-FAS

  21. Corn Export Shifts Source: USDA-FAS

  22. Wheat Export Shifts Source: USDA-FAS

  23. Rice Export Shifts Source: USDA-FAS

  24. Cotton Export Shifts Source: USDA-FAS

  25. Ethanol Exports Source: EIA

  26. Population vs. arable land Share of global Share of global population arable land China 19% 5% India 17% 10% US 4% 13%

  27. Arable land

  28. Want to provide feedback on my presentation?https://www.surveymonkey.com/r/ChadHart

  29. Thank you for your time!Any questions?My web site:http://www2.econ.iastate.edu/faculty/hart/Iowa Farm Outlook:http://www2.econ.iastate.edu/ifo/Ag Decision Maker:http://www.extension.iastate.edu/agdm/

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