With no specific details of the Phase-1 agreement with China, farmers are contemplating their selection of crops for 2020.  The trade war seriously impacted soybean acreage harvested down 15.0 percent from 2018 to 75.0 million acres in 2019.  Sorghum was planted on 5.3 million acres down 8 percent from 2018.  Both crops are heavily dependent on imports from China to achieve profitability.  Farmers are anticipating an extension of the Market Facilitation Program that involved transfer of approximately $28 billion from public funds to farmers over 2018 and 2019.  The USDA has yet to decide on future payments but a prominent farmer was quoted as stating, “If the government doesn’t pay us we’re done.” 

According to Reuters, farmers are favoring corn over soybeans with their early seed orders, weary of commitments by China to import soybeans and cognizant of the reduced demand independent of trade disputes following the advent of African swine fever.  China has also reduced imports of cotton from the U.S. and has established alternative suppliers for soybean including Brazil and Argentina. 

Some farmers are evaluating alternatives to corn and soybeans with one Iowa farmer sowing winter wheat and rye.  He was quoted by Reuters as stating, “The agriculture system is completely broken because of the trade war, severe weather, and mounting farm debt.  We just have to farm smarter.”