Brett Wilder’s economic forecast at this year’s East Idaho Cereals Conference was a mixture of an improving economy but one tempered by the uncertainty of what the trade policy directions of the new Trump administration will impact small grain producers in Idaho.

“Really the big forecast, and I think what you can say with some certainty is that we should brace for volatility in 2025,” Brett Wilder told attendees during the opening presentation at the University of Idaho’s East Idaho Cereals Conference held in the Shoshone-Bannock Event Center at Fort Hall on Feb. 5.

Wilder is an assistant professor and area Extension Educator specializing in Farm Business Management at the UI Caldwell Research and Extension Center.

“Since we came out of that COVID recession, the U.S. economy’s been pretty stable, pretty strong, the forecast for that’s expected to continue,” Wilder said, “but there’s been a few factors there that give us pause. One of those things is inflation.”

While consumers are continuing to struggle to return to their pre-Covid buying power, overall the U.S. economy is gaining strength, according to Wilder.

“The United States is relatively strong compared to the rest of the world,” he said, “the U.S. only grew at a slower rate than Spain and is expected to grow at the fastest rate of all developed economies for the next two years, for 2025 and 2026.”

A strong U.S. economy means U.S. exports cost more overseas.

“When our economy is relatively strong compared to the rest of the world, our dollar tends to be stronger,” Wilder told the audience. “When we have a strong dollar our exports are more expensive for the world to buy.”

Wilder said that while U.S. ag products are of a higher quality compared to products from foreign producers, the higher costs tends to inhibit international sales of U.S. exports, contributing to U.S. trade deficits.

In an effort to reduce U.S. trade deficits the Trump administration has been threatening to place import tariffs on goods coming in from Canada and Mexico.

“For ag exports, our biggest markets are China, Mexico and Canada. Who are we having some trade spats with? Canada, Mexico, China. Who do we import the most from? Mexico, Canada and the European Union,” Wilder said.

“For this most recent marketing year, ending in November 2024, 90% of our barley exports went to Mexico and Canada,” Wilder told the audience. “If we have a trade war in North America the most likely crop that’s going to get hit the hardest by that, that impact you folks in this room, is going to be barley.”

That 90% of barley exports to Canada and Mexico represents between 15 and 20% of total U.S. barley production.

Wilder didn’t want to hazard a prediction on future commodity prices but he did cite a past tariff retaliation in 2018 of 25% on soybeans by China against tariffs imposed by the U.S. Trade Representative that resulted in soybean futures dropping roughly 20% as an example of the negative impact tariffs can have.

“I don’t think you can make production decisions today based on what might happen with tariffs. It is good to know about, it’s good to keep an eye on, and obviously the conversation is going to create some volatility,” was his advice to growers in the audience.

While he doesn’t have a crystal ball to predict market futures Wilder did give the audience his outlook for wheat and barley for the coming year.

“My forecast for wheat, I’m not going to give you exact prices,” he said, “is that we’re going to be pretty flat in 2025. I don’t see large opportunities for movement in either direction with a lot of competing factors both ways.”

Idaho being the number one barley producer in the nation, it’s an important crop here, he said.

Using USDA price forecasts for barley, Wilder described the market for barley to be “sideways to down for 2025.”

Wilder said that “if we have aggressive trade policy and aggressive retaliation, that’s probably going to drive this whole sector downwards….trade is front and center as we talk about what is going to happen in 2025. Barley is more likely to see impacts if we have a trade war in the North America region. But again, there’s nobody in this room that can tell you what’s going to happen there and I don’t know that you can make production decisions off of a maybe.”