KNOXVILLE, Tenn. — Economic problems in Asia have U.S. farmers concerned about their agricultural exports, a University of Tennessee farm policy analyst said Tuesday.
Dr. Daryll Ray, an agricultural economics professor who holds UT’s Blasingame Chair of Excellence in Agricultural Policy, said the full impact of the faltering Asian economy on U.S. farm exports is unclear.
Prolonged economic problems overseas will likely affect pork, beef, poultry and grain exports, he said.
“Asia is a wild card and it is hard to judge the total impact it might have on agriculture,” Ray said. “It could be just a blip or it could be a problem that could continue with us for a few years.”
Buoyed by a recovery on Wall Street, Asia’s battered stock markets rebounded Tuesday, led by a 7.4 percent rise in Hong Kong.
However, the collapse Monday of one of Hong Kong’s major investment firms, a surge in bad loans held by ailing Japanese financial institutions, and other problems continue to raise doubts about the troubled Asian economy.
Ray said most of the U.S. increase in livestock imports has been in Asia, and is projected as the site of the highest future growth. Asia is also an important market for U.S. crops, he said.
“China is the biggest hope for many folks to increase export demand for corn in the future,” Ray said. “The extent of their economic problems and the policies they impose could have a definite impact on the export demand for corn.
Ray said the situation also might affect Tennessee production and export of corn, wheat, soybeans, tobacco and cotton for export.
“Everybody is in a ‘wait and see’ mode,” Ray said. “All farmers are concerned and they are trying to think through the net returns and price ratios for the various crops they have available to plant.
“The key is to look ahead and see where they think acreage needs to be placed to position themselves for the market, and that is not an easy task.”
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Contact: Dr. Daryll Ray (423-974-7407)