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Pearson sees reasons for optimism in 2018

Crop and livestock producers in southeast Minnesota were told there are reasons for optimism looking ahead to 2018.

 

Market analyst and Market to Market host Mike Pearson was the featured speaker at the Compeer Financial Outlook meeting in Rochester Tuesday, beginning his presentation by talking about economic cycles in agriculture since 1900.

He pointed to four major booms, two of which followed world wars.  Pearson attributed the most recent boom to the recession of 2008 drawing investment money to agriculture, combined with unprecedented demand from China and the rise of ethanol because of the RFS.  Pearson says while history shows the next big boom in agriculture probably won’t happen for another 26 years, there will be opportunities to turn a profit next year.

He predicts demand for soybeans to remain strong, and there’s a 30 cent carry in corn futures if farmers are able to hold grain until June.

Pearson is also quite bullish on livestock going into the new year, but reminds producers they need to be strategic in managing risk.