World agricultural production is increasing and demand growth weakening, causing lower real farm prices for the next decade, according to the Organization for Economic Cooperation and Development. But the projections don’t account for likely disruptions attributed to President Trump’s trade policies, several experts said Tuesday at an OECD forum in Washington. Realignment of trade caused by new tariffs will mean higher costs and less efficiency, said OECD analyst Jonathan Brooks. “The biggest and longest-lasting problem is the discrediting of institutional bilateral and multilateral trade rules” under the World Trade Organization (WTO), said Farm Foundation President Constance Cullman. “It’s hard to hold China to the WTO rules if we want to blow up the WTO.” She likened the potential outcome to the Soviet oilseed and grain embargoes of the 1970s, adding, “We never got that market back.” Recent trade disruptions “could not have come at a worse time,” she said, in the face of the slowdown in demand and lower farm prices. “They exacerbate a growing crisis in rural, agricultural communities. We are going to have to be prepared for it.” The changes in trade policy “may impede projected trade growth” incorporated in the outlook published last week by the OECD and the UN Food and Agriculture Organization (FAO), said USDA Chief Economist Rob Johansson. “We may see some short-term adjustments” as trade flows realign to adapt to market changes, he said. “The question is how long it will take to develop new marketing patterns.”
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