Market Outlook

September 7, 2016 02:13 AM
World ripples

Policy Update with Mike Adams

Presidential Candidates Make Tradeoffs on Path to White House

It’s hard to find anything that Donald Trump and Hillary Clinton agree on. Unfortunately for agriculture, the one thing they have in common is their criticism and opposition to trade deals. 


Both candidates should be careful not to throw the baby out with the bath water. Agriculture, thanks in large part to trade agreements, has enjoyed a trade surplus over the 
past several years. 

For example, since the implementation of the North American Free Trade Agreement (NAFTA), U.S. agriculture exports to Canada and Mexico have more than quadrupled. The U.S. has a 65% market share in the NAFTA market compared to an 11% share in non-NAFTA countries. Too bad we can’t negotiate ag-only deals, but then again, we can’t even negotiate an ag-only farm bill. 

Although no deal is perfect, those who are blaming trade agreements for a loss of jobs and business overlook factors such as burdensome taxes and regulations that make us less competitive in the global market. 

Trade deals actually create jobs, reduce tariffs and open markets. Certainly if better deals can be reached, we should do so. Until then, though, we should heed the old warning: Never quit a job until you are sure you have a better one to go to. 

Hear “AgriTalk” each weekday at 10:06 a.m. CST on the MyFarmRadio app or at

By Nate Birt

Ask an Analyst: Naomi Blohm, Stewart-Peterson


What is your commodity marketing philosophy?
We take a global macro philosophy, along with scenario planning. What would make the market move 50¢ higher? Two dollars higher? Producers are able to have more confidence in their marketing and not be caught off guard.

What distinguishes your consulting firm from others?
We focus on the overall weighted average price of commodities. When we use a market strategy, we have an Excel spreadsheet that we use to say, ‘If we have 50% of our cash grain sold, and if we buy puts on the 50% that’s unpriced, what would our overall weighted average price be if the market falls 50¢? If we drop $1?’ Sometimes it’s tempting to say, ‘I sold some corn at $4.25,’ but who cares if it was only one-tenth of production?

What should producers do now to manage risk? 
Be on the defensive. The world assumes the crop is there until proven otherwise. However, with the hot temperatures in June, there could be a surprise The corn yield might not be as good as they’re thinking. There are rumblings of South America not being able to export in the short term, in which case the U.S. is the game in town. Those are potentially supportive of higher prices. 


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