By Jamie Martin
In 2025, US farmers are bracing for significant economic shifts. Speaking at the South Dakota AgOutlook, expert Matt Erickson highlighted the interplay between macroeconomic factors like interest rates and tariffs, alongside market dynamics in determining farm incomes.
Specifically, the projected decrease in soybean yields—from 51.7 to 50.7 bushels per acre—suggests a challenging year ahead.
Erickson pointed out that market indicators, notably the soybean-to-corn price ratio, are currently favoring corn planting over soybeans for the upcoming year. This is based on the March Prospective Plantings report, which will play a critical role in farmers' decisions.
On a global scale, South America is expected to record a significant increase in soybean production, especially from powerhouses like Argentina and Brazil. This 10 percent increase from the previous year marks a record high, contributing to the global surplus of soybeans, thereby influencing US market decisions.
Erickson emphasized the importance of the world stocks-to-use ratio for soybeans, noting that Brazil currently offers the most competitive export prices.
However, for corn, the scenario differs. Excluding the US, the combined stocks-to-use ratio for Brazil, Argentina, and Ukraine is the lowest since the 1983/84 season, indicating a scarce global supply of corn.
“I think the main thing here for 2025 is when you look at some of these metrics in the market, such as the soybean-to-corn price ratio, the market right now is just screaming ‘corn acres,’” Erickson commented. His insights provide a vital perspective for US farmers planning their 2025 crop strategies, facing a year potentially fraught with market-driven challenges.
Photo Credit: gettyimages-studio2013
Categories: National