Volatile economic climate churned by Twitter storms

By: 
Duane Dailey

The calm quiet country life is ideal, right? Just go with the flow through the growing season, right? Then why do I hear so much about uncertainty and volatility.

It was enough dealing with droughts, floods and lightning strikes. Now farmers worry about early morning Twitter storms. With a couple of tweets after waking up in the morning, the long sought and profitable beef trade with China falls into doubt. Farm prices drop. Outlooks droop.

Even before we entered a trade war, talk of tariffs sends markets whacko. My favored newsletter from a Kansas feedlot opened Friday with “Wow…what a ride.”

Supply and demand didn’t change. That carries its own squeamishness. Later in the letter, comes news of live cattle selling for $118 per cwt on Tuesday falling to $97 on Wednesday. By Friday market close, it’s back up to $105.

Feedlots plan to ask $120 on Monday.

Fed calves in the supply chain didn’t change in that brief time. Price churning came from uncertainty over tariff impacts on exports. We must have exports to sell our surplus beef.

Another newsletter tells that exports were up 10 percent with value of that beef up 20 percent. That fits my earlier story from Scott Brown, MU economist, on how foreign buyers value the taste of our beef. They bid more for U.S. beef.

That should be a calm ride up, right.

If someone who knows nothing about farm trade starts tweeting policy on whim, uncertainty abounds.

In the same week soybean growers suffered possibly more profound losses from tariff panic.

Beef just restarted in China trade after a two-decade ban. Soybeans are already in the supply line to China. As 30 to 40 percent chunk of our beans go abroad, 60 percent of that export goes to China. Lose that trade, the whole Farm Belt suffers. Big time.

My favorite political commentators on XM radio POTUS channel tell that new tweets on tariffs are to punish China for stealing U.S. software and patents. They ask: Why don’t we punish U.S. corporations who give secrets away or let them be hacked? Why must Midwest farmers bear the brunt? Maybe we’re not as close to the President as the lax CEOs.

When policy changes without explanation, uncertain speculation brings volatility. My life long theory maintains full and open communications keeps calmness.

In other uncertainties, farmers at the MU Soybean Symposium last week, learned about weather. One listener noted the talk was not on climate change, but variability.

We learned in the last 10 years our growing season grew nine days? That should be really good for farmers, right? Maybe not. There’s less sun and more rain in that extended period. Spring planting and fall harvest become more uncertain. Our weather grew more volatile.

Rains grew in intensity, falling in more concentrated and scattered spots. We’ve seen that. Nearby neighbors get vastly different rainfall. The weather radar shows more spottiness.

Okay. There’s more uncertainty than rain for crop growers, Consider controlling weeds.

I remember driving mile after mile of seeing clean soybean fields. Not a weed in sight. Now, I can’t do that. More commonly I see marestail weeds and Palmer pigweed growing out of the bean canopy.

The magic of one herbicide worked for years. Then weeds outsmarted the spray and became resistant. Last year, a new herbicide gave extreme protection to beans bred to tolerate it.

However, plants nearby could die as well.

What do farmers do this year? They become are uncertain about which herbicides to use. They must stay friends with neighbors.

Even bigger, farmers are uncertain if they’ll ever start planting a crop in this volatile spring weather. In recent warm years, farmers were planting corn by April 5.

Oh, the calm life of a farmer.

Tell me your uncertainty in life: duanedailey7@gmail.com or 511 W. Worley, Columbia, Mo., 65203. 

Here we dropped from 60F one day to snowfall the next. 

Certainly no soybean planted here.

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