Last week, the USDA confirmed that we have a 15.2BB corn crop. The challenge now is finding the demand for all that corn. Building demand is the top priority for the National Corn Growers Association.
NCGA executive Director Chris Novak says any hope for increased corn demand and higher corn prices will have to come from the export market, “Building demand for the corn market is going to be a slow process,” he stated. “If you put it on a boat and sell it overseas, you can increase demand rather quickly. But increased demand from the ethanol market and livestock markets is going to take longer.” He noted that, while livestock numbers are up, livestock producers are not profitable and thus will not be a growing market for corn.
Despite the anti-trade rhetoric of the campaign, Novak is optimistic that President-elect Trump will make agricultural trade part of his economic plan, “We need our government to step up and make sure trade works for America.” He said the Chinese have manipulated the rules and trade. He looks to the new administration to level the playing field with both China and the EU, “This is a role the Trump administration can play in making sure we have open and competitive markets for U.S. agriculture.”
Novak is optimistic that the Trump administration will do away with burdensome regulations which will also help corn growers be more productive and profitable. Yet, he is not optimistic that we will see much price recovery in 2017 unless we have an unexpected event.