Cornell University hosted the Agribusiness Economic Outlook Conference in December. Overall, experts expect a good year for the agriculture sector in general, but add that the dairy industry should be wary.
According to Ithaca Journal, Mark Stephenson, director of dairy policy analysis at the University of Wisconsin, predicted that the dollar will remain strong in the coming year due to other major economies facing problems.
Stephenson said he’s heard the situation described as being “the best-looking horse at the glue factory.”
A strong U.S. dollar, while positive in many respects including increased domestic buying power, means that American products will be more expensive for overseas buyers and will further reduce international demand.
Steven Kyle, associate economics professor at Cornell also discussed other economic predictions, including a decline in unemployment to between 5 and 5.5 percent and steady interest rates. The stock market is also predicted to remain susceptible to shocks.
Kyle also predicted a domestic annual growth rate of 3 percent and a general “upswing in the business cycle.”
While positive economic indicators were discussed, experts predict the new year will see harder times in the dairy industry.
Many considered 2014 a very good dairying year with higher milk prices, good consumer demand and pricing tolerance and lower feed costs. However, international demand and pricing are trending downward while U.S. production and herd size are moving up.
This imbalance of supply and demand heralds harder times ahead, though not as difficult as 2009. PD
—Summarized by Progressive Dairyman staff from cited sources