It is hard to believe that we are here again at the end of another calendar year. I am now into my 32nd year of writing this column and it’s hard to believe we’re putting a capper on a year with numerals 2017. Back in 1986 when I started writing this column, I was not only a young man, but also I wrote it in long hand. I’m sure some of my readers don’t even know what long and is anymore.
Of course, that is probably a good thing. Technological change is almost a default these days and it seems to be accelerating as the years go by. I don’t know what is going to happen in 2018, but surely there will be more technological change and we will still be dealing with Mother Nature. At the end of the day, even with all our risk mitigating technological improvements, fickle weather can still cause us fits.
A year ago I was touring Ontario farm country for BDO Canada. I was giving my market forecast for grains but also talking a little bit about the politics, which were changing our land. In my presentation I put up a slide of President Trump and told the audience how this man would define 20i7. I must say that I usually don’t make predictions, but last year I think I nailed it. President Trump dominated the headlines and he certainly had an effect on North American agriculture.
He called NAFTA a disaster and he withdrew the Americans from the Paris Climate Agreement as well as the TPP. That is all radical stuff compared to where we thought we were in most of 2016. We even had Mexico pivot on importing US corn. The insults were so intent on Mexico from the American President that the number two customer for American corn started to look elsewhere. Brazil and Argentina were set to benefit. American farmers recoiled hoping their President would somehow realize that none of this was helping.
Of course responding to this in Canada was Prime Minister Trudeau and the relatively new Canadian government. Mr. Trudeau had to deal with a completely different scenario from our American friends than anybody expected. How do you deal with the bull in the china shop, especially one that was not expected? I give a lot of credit to the Prime Minister as well as the foreign affairs Minister Chrystia Freeland for actively co-opting President Trump and many American legislatures. The NAFTA agreement is at risk and the stakes are high. However, President Trump says he likes Prime Minister Trudeau and in this American political environment that’s a great start.
Of course what is at stake in Canada is a trading relationship with the biggest richest economy in the world. We are very used to our American friends giving us a bit of trouble, but this latest President is a showman. It takes a completely different diplomacy to make this work. Canadian farmers surely hope it does.
The USDA provided much drama in 2017. On March 31st the USDA announced that farmers were expected to plant 90 million acres of corn, down 4 million acres from 2016. On the other hand, the USDA announced that soybean acreage would be up 7% from 2016 coming in at 89.5 million acres. Then June came along and in their June 30th USDA report they predicted US corn planting at 90.89 million acres and US soybean planting coming in at 89.51 million acres. Along came November and USDA boosted national corn yield to 175.4 bushels per acre and soybeans at 49.5 bushels/acre. Prices swooned.
Of course, in between March and November there was quite a bit of drama regarding crop conditions. There was a lot of dry weather throughout the American Midwest but nothing scorching. The crop strengthened by 2017 genetics seemed to hold up. However, on social media there were howls from those who thought the crop wasn’t there. Even your loyal scribe took a trip to Iowa in August 2017 and I deemed the crop in good shape from my view along I-80. At the end of the year, the USDA had reset the goalposts and grain surpluses are almost everywhere keeping American cash prices at very low levels. Our Canadian dollar hovering between 72 and $.82 all of 2017 has mitigated those prices for Canadian farmers.
Of course 2017 had a few other agriculturally related stories. You might have noticed a bit of dicamba volatility. Crinkled soybeans don’t lie.
As for me, in 2017 I managed to get everything planted and everything harvested. Mother nature caused me a few problems as always. However, the stars align for a personal record corn crop. I guess I just added to that surplus. With that, let’s put 2017 to bed. Nothing is ever so good, it can’t be improved. Let’s hope that is 2018.