Before we get to that, let’s look at the year behind. Last year’s predictions produced some very favorable results. Let’s just do a quick summary. The first prediction was that inflation would continue to move higher. Hard to stop a freight train. While the rate of inflation has slowed, it’s settled above the Fed’s 2.0% target, and following three years of steep price increases, employers and consumers are still fighting the impact. Interest rates we predicted would be slightly lower dropping one half to three quarters of a point. The prime lending rate has gone from 8.50 to 7.75, a three quarters of a point drop.
Farmland prices we predicted to be flat. That has been fairly accurate depending on where you live. Some areas farmland prices were higher if the right two farmers or investors were in the room bidding. In most areas, however, the market was flat.
Corn prices we predicted would drift into the low $4.00 range. Central Illinois hit $3.45. For soybeans we were a little too friendly. We forecast a futures price range of $12.00 to $13.50. Central Illinois prices hit $9.40.
Cattle and hog prices we forecast a substantial bull market in both. That is exactly what happened.
In the stock market our forecast was for a significant move to the upside. That was dead on. For fuel, the forecast was for continued strong global production. Crude oil dropped from $77.50 to $69.60 and diesel fuel from $2.83 to $2.24.
Some of the year’s trends are possibly not what people wanted, but the market is what it is. Now let’s take a stab at where the major commodities will move in 2025. This is an exercise everyone should try. Take a piece of paper out now and write down what your forecasts are. You might be surprised how difficult forecasting a year in advance is.
Looking Forward
1. Inflation. President-elect Trump campaigned on the issue that he was going to bring inflation down. He will likely be correct in the long-term by the third year of his term, but we do not believe he’s going to be correct for 2025. Wars are inflationary. He is not going to be able to increase fuel supplies fast enough to bring the market down. With the promises that have been made to increase spending in certain areas of the economy and to bring taxes down for certain sectors of the economy, we do not see how it is possible to bring inflation down in the coming year. Housing prices nationwide have already started to show some weakness and that will likely continue. But overall, inflation should stay steady over the next 12 months.
2. Interest rates. Here again, with all the promises that have been made on lowering taxes and increasing spending in certain sectors, it’s going to be difficult to bring interest rates down. We are not predicting that they are going up at all but to see anything much lower than where we are right now would not be healthy overall for helping to control inflation.
3. Farmland prices steady. Incomes from grain are not going to be strong enough to cause a bull market in farmland prices. But nevertheless, debt-to-asset ratios (see online chart) are still at historical lows. Wealth has been accumulated both on the farm and off the farm over the last few years. The stock market has been very strong and has created enormous wealth for investors. Cash is king and there will still be plenty of cash helping support the farmland market.
4. The stock market will stay strong. Cash is king and returns in the stock market have been incredible over the last couple of years. Artificial intelligence is changing the world and industries. 2025 should be a very strong year in the stock market.
5. Corn prices. Expect the market to move up. Corn prices are currently trading at levels under what the balance sheet would indicate, and demand is outpacing USDA predictions. Granted supplies are high but they are also built into today’s prices. With the cash market in the central Corn Belt currently trading at $4.00 and in some areas slightly lower, the risk on the downside is minimal. Supplies are too large to result in a major bull market, but it is certainly not out of the question to see prices in the mid to high $4.00 range before the growing season is over.
6. Soybean prices. Higher. Current low prices are going to discourage any increase in planted acres worldwide. Cash prices are currently in the mid-to-high $9.00 range. That is discounting almost all of the bearish news. As in corn, supplies are large enough to prevent a major bull market but seeing prices move back into the mid to high $10.00 range is certainly not out of the question.
7. Cattle and hogs. This is a difficult one going into a year with so many variables. While prices could be weak in the first quarter, we’ll go out on a limb and say the market in both cattle and hogs will finish the year higher. This is a high-risk prediction. The last bull market in cattle and feeder cattle lasted four years from 2010 to 2014. This one started in 2020. Thus, we’re counting on a one-year extension in the bull market. In hogs, the last two bull markets were 2009 to 2014 and then 2020 to 2022. Hog prices will likely struggle in the first quarter but expansion, or lack thereof, should help bring the market back in the second half.
8. Fuel. Steady to lower. But don’t expect any major price drops. The Trump administration is not going to be able to implement their sales campaign of “drill baby drill” as quickly as they think. Longer-term, fuel prices are going to head down but we may still be saying the same thing a year from now.
9. Cotton. Prices will likely head slightly higher. The market has already discounted significant bearish news and at 70 cents, we believe we could see an increase in demand. A strong economy and increased spending will help this market. It will take an onslaught of bullish news to get to market back to $1.00 per pound, but 80-85 cents is certainly possible.
10. Wheat. Prices will finish the year higher. With cash prices in the low $5.00 range, almost all the bad news is discounted in this market. Not difficult to anticipate wheat prices moving to $6.50 or higher. Supplies are large worldwide. A major bull market is not in the making but better times than what exists now should be.

Putting It All Together
One thing that cannot be predicted is major surprises and “black swan” events. With the volatility in the world right now, there are several possibilities including:
1. China heightens the conflict over Taiwan.
2. A potential world war.
3. A trade war between the U.S., China, Mexico and Canada. We don’t believe that will happen, but it is certainly not out of the question.
4. With the soybean-to-corn ratio having moved by $5.00 in the last year, with soybeans declining relative to corn, could we see a significant planted acreage shift going from soybeans back to corn? Not likely, but certainly not out of the realm of possibility.
From all of us at Brock Associates, we wish you a joyous Christmas and Happy New Year. We thank you for your business and continued support. Have a healthy and prosperous 2025!