The January Ag Economists’ Monthly Monitor that was just released predicts an improving outlook for farmers and ranchers in 2025, with beef and pork production ranked the best, followed by dairy, poultry and grains. Top ranked beef production is good news for cattle producers, but not so much for consumers, who can expect higher retail prices, with cattle markets reaching historic highs early in 2025, while tight supplies and strong consumer demand may push prices even higher this year. USDA’s latest Cattle Inventory report indicates a U.S. beef cattle inventory will fall to the lowest level in 64 years, and with beef cows numbers down 1%, beef supplies may be stable for a while, since a heifer calf born this spring won’t produce a calf until she is about two years of age.
The January Ag Economists’ Monthly Monitor asked participants which of Trump’s priorities will have the most negative impact on agriculture. Seventy-nine percent cited trade and tariffs, while 22% said border security and deportation. While 54% of economists said that cutting government regulations would be the most positive impact of his priorities.
Although Donald Trump received a lot of support from farmers and ranchers in the 2024 election, some producers may have buyers' remorse. Reports indicate that farmers are learning that soil conservation payments for projects funded through the Inflation Reduction Act were cut off by the Trump administration. This is happening in spite of a federal judge’s ruling that the administration did not have authority to block funding that was appropriated by Congress. For example, a Missouri cattle producer pointed out on TikTok that he had signed a contract with USDA's Natural Resources Conservation Service for a $240,000 grant to to improve water lines, fences and a well that would help him to maintain and improve crop production, while conserving natural resources. But recently, USDA officials notified him that his contract with the Environmental Quality Incentives Program was frozen, and that it wasn’t clear when, and if, the funds would be released, even though he had completed a lot of the work and had already paid for materials and labor. He’s concerned that after spending tens of thousands of dollars to complete the project, and if he isn’t reimbursed, he may lose his family’s farm. A USDA spokesperson stated that all federal agencies have been asked for similar program reviews.
Dairy and pork producers are also concerned with the current rhetoric about immigrant workers and tariffs, because their farms are heavily dependent on this source of labor. The constant news releases about mass deportations is particularly concerning to dairy farmers, because the dairy sector is heavily reliant on immigrant labor to support milk production. Surveys conducted by the National Milk Producers Federation point out that over half of all dairy labor is performed by immigrant workers, and that those laborers contribute to the production of 79% of the U.S. milk supply. Pork producers point out that in 2023, exports accounted for almost 30% of the total U.S. pork and pork variety meat production, with Mexico, Japan, China,Hong Kong and Canada being the four largest customers. Exports for 2023 year surpassed $8.1 billion in value of the 2.9 million metric tons exported, and Mexico received 10% of U.S. pork production.
With all that is going on, an old cowboy I know would say, hell's a poppin in Washington, sorry George D.C., but who knows?
