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US and Global Ag Outlook

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March 29, 2022

Farm cash receipts are projected to top $400 billion a year in the 2020s despite falling government payments

The three major US crops by acreage are corn, soybeans, and wheat. Their combined acreage of about 230 million acres accounts for over 70 percent of harvested US crop land.

Corn, soybeans and wheat account for 70% of US crop land harvested

The value of US fruit, tree nut, vegetable, and pulse (dry bean) crops was $49 billion in 2020, and is projected to increase to $57 billion by 2031. By value, fruits and nuts were worth $28 billion in 2020 and vegetables were worth $21 billion. By volume, the 55 billion pounds of US fruits and nuts were swamped by the 128 billion pounds of US vegetables.

US fruits and nuts were worth $28 billion and vegetables $21 billion in 2020

Noncitrus fruits such as apples, strawberries, and cherries accounted for $15 billion or over half of the $28 billion in fruits and nuts in 2020, followed by tree nuts worth $10 billion and citrus worth $3 billion. US fruit and nut production is expected to rise slightly to 54 billion pounds worth $31 billion by 2031, reflecting a decline in citrus production to 12 billion pounds while tree nut production rises to 10 billion pounds.

Fresh vegetables (including melons, mushrooms and sweet potatoes) are 30 percent of total vegetable output by volume, followed by processing vegetables, 28 percent, potatoes, 20 percent, and pulses, 12 percent. Fresh vegetables are 60 percent of the total value of vegetables, potatoes, and pulses, led by lettuce, tomatoes, onions, and sweet potatoes. Tomatoes are 70 percent of US processing vegetables by value.

The value of by fresh vegetables is projected to rise 30% between 2020 and 2013, and the value of tree nuts by 20%

   
Fruit, nuts, and vegetables long-term projections to 2031
Item Unit 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
Production, farm weight  
  Fruit and nuts Mil. lbs. 54,672 52,773 50,908 51,681 52,851 53,173 53,554 53,337 53,792 53,807 53,944 54,099
    Citrus Mil. lbs. 15,704 13,804 12,190 12,571 12,558 12,546 12,533 12,521 12,508 12,496 12,483 12,471
    Noncitrus Mil. lbs. 30,729 31,087 30,465 30,772 31,758 31,939 32,163 31,794 32,095 31,958 31,942 31,944
    Tree nuts Mil. lbs. 8,239 7,882 8,253 8,338 8,535 8,688 8,858 9,022 9,188 9,353 9,519 9,684
 
  Vegetables1 Mil. lbs. 126,096 125,850 133,940 133,551 131,931 130,907 130,808 130,771 131,332 131,895 132,150 132,518
    Fresh market Mil. lbs. 38,799 42,350 43,515 42,850 42,821 42,883 42,900 42,921 43,054 43,160 43,072 42,984
    Processing Mil. lbs. 32,976 31,993 34,313 33,028 33,068 33,328 33,585 33,835 34,084 34,323 34,558 34,792
    Potatoes Mil. lbs. 42,020 41,316 44,297 46,546 44,386 43,082 42,559 42,208 42,254 42,275 42,239 42,398
    Pulses Mil. lbs. 6,638 4,508 6,162 5,500 6,054 6,041 6,220 6,290 6,448 6,670 6,835 6,921
    Other2 Mil. lbs. 5,663 5,683 5,654 5,627 5,603 5,572 5,543 5,517 5,492 5,469 5,446 5,424
 
  Total fruit, nuts, vegetables Mil. lbs. 180,767 178,623 184,849 185,232 184,782 184,080 184,362 184,107 185,124 185,703 186,094 186,618
 
Farm value  
  Fruit and nuts Million dollars 28,119 27,425 27,648 28,058 28,421 28,802 29,193 29,592 30,000 30,410 30,834 31,268
    Citrus Million dollars 3,396 3,310 3,274 3,376 3,407 3,437 3,468 3,500 3,531 3,563 3,595 3,627
    Noncitrus Million dollars 14,655 14,147 14,194 14,289 14,410 14,547 14,695 14,851 15,015 15,180 15,351 15,527
    Tree nuts Million dollars 10,068 9,967 10,180 10,392 10,605 10,817 11,029 11,242 11,454 11,667 11,888 12,114
 
  Vegetables Million dollars 21,020 21,640 22,061 21,665 22,184 22,617 23,076 23,595 24,123 24,663 25,223 25,818
    Fresh market Million dollars 11,660 12,238 12,301 12,603 12,893 13,199 13,511 13,859 14,215 14,587 14,983 15,398
    Processing Million dollars 2,008 1,887 2,004 1,848 1,878 1,917 1,957 1,997 2,038 2,079 2,121 2,164
    Potatoes Million dollars 3,906 4,111 4,472 3,990 4,025 4,076 4,130 4,185 4,238 4,293 4,349 4,405
    Pulses Million dollars 1,462 1,387 1,243 1,154 1,281 1,295 1,322 1,375 1,432 1,479 1,516 1,568
    Other 2 Million dollars 1,984 2,017 2,040 2,070 2,107 2,131 2,156 2,179 2,200 2,226 2,254 2,284
1 Includes melons, sweet potatoes, and mushrooms. Utilized production is used for potatoes. Pulses include edible dry beans and peas, lentils, and other peas.
2 Other includes melons and mushrooms. Sweet potatoes included with fresh vegetables.
Note: Totals may not add due to rounding. The projections were completed in December 2021.
Source: USDA, Interagency Agricultural Projections Committee.

USDA acknowledges that its data collection systems do not fully reflect output from CEA or controlled environment agriculture such as greenhouses and urban vertical farms. CEA production of tomatoes, cucumbers, and other fresh vegetables is rapidly replacing open-field production.

Trade. The US has had an agricultural trade surplus since 1960, exporting farm goods worth more than the value of imported farm goods. However, the US farm trade surplus is projected to become a deficit as the US imports more high-value fruits and vegetables while the value of US exports of meat and grains stabilizes.

The US farm trade surplus is expected to become a deficit after 2022

Half of US farm exports are grains and oilseeds that are produced in competition with other major farm exporters including Brazil, Canada, and Russia. The value of US meat and dairy product exports is about equal to the value of US fruit and vegetable exports.

Half of US farm exports are grains and oilseeds

US farm imports are dominated by horticultural products including fruits and vegetables, and the horticultural share of US farm imports is expected to increase in the 2020s. The value of US farm imports is expected to increase by almost $100 billion during the 2020s, from $163 billion in FY21 to $261 billion in FY31.

US horticultural imports are projected to increase by almost $100 billion by FY31

Horticultural imports include beer, wine, and distilled spirits, but most are fresh fruits and vegetables and packaged or prepared food products. Many imported horticultural products are organic, making them less sensitive to price and currency fluctuations.

Inflation. Food prices are expected to increase in 2022 due to increased costs for farm inputs such as fertilizers, rising labor costs, and shipping cost increases amidst reduced output attributed to drought, natural disasters, and the Russian invasion of Ukraine in February 2022. La Nina weather, which is occurring in 2021-22 in a repeat of 2011-12, typically means droughts in South America and the southern US.

The FAO global food price index rose over 25 percent between 2020 and 2021

Rabobank expects wheat prices to top $8 a bushel in 2022, corn to decline to about $6 a bushel, and soybean prices to decline to less than $13 a bushel. The price of Arabica coffee is projected to drop from the current $2 a pound by the end of 2022.

The prices of wheat, sugar, and palm oil are rising, while the prices of corn and soybeans are falling

The prices of wheat, sugar, and palm oil are rising, while the prices of corn and soybeans are falling
Commodity unit Q1'21 Q2'21 Q3'21 Q4'21e Q1'22f Q2'22f Q3'22f Q4'22f
Wheat (CBOT) USc/bu 646 680 698 788 820 810 750 750
Corn (CBOT) USc/bu 538 659 560 570 585 590 595 585
Soybeans (CBOT) USc/bu 1,388 1,497 1,361 1,260 1,270 1,275 1,280 1,265
Soy oil (CBOT) USc/lb 48 63 62 60 60 59 59 58
Soymeal (CBOT) USD/t 426 400 352 345 348 350 347 345
Palm oil (MDEB) MYR/mt 3,634 3,892 4,245 4,914 4,700 4,500 4,300 4,300
Sugar (ICE #11) USc/lb 15.5 16.9 19.4 19.5 20.0 20.5 20.8 20.8
Arabica coffee (ICD) USc/lb 129 147 181 220 200 178 174 166
Robusta coffee (ICE) USD/mt 1,372 1,512 1,918 2,197 2,000 1,880 1,820 1,800
Cocoa (ICE NY) USD/mt 2,496 2,436 2,519 2,587 2,580 2,630 2,680 2,710
Live Cattle* USD/cwt 117 119 123 130 134 142 141 147
Lean Hogs (CME) USc/lb 80 111 98 78 80 88 89 78
Dairy (WMP**) USD/mt 3,652 4,093 3,750 3,950 4,000 4,000 3,850 3,750
* US Five-Market Fed Steer Price
** WMP FOB Oceania

Palm oil is the world’s major vegetable oil, and most of the 80 million metric tons produced each year are from Indonesia, which has 15 million hectares producing 60 million tons, and Malaysia, with five million hectares producing 18 million tons. High fertilizer prices reduced yields of palm oil, while Malaysian covid-prevention policies limited the entry of migrant workers who cut bunches of palm oil fruit from trees for processing.

Palm oil accounts for almost half of the stock of vegetable oils

Stocks of coffee went from surplus to shortage during covid, allowing prices to double from about $1 to $2 a pound. Brazil is expected to produce 45 million bags of Arabica and 21 million bags of Robusta coffee in 2022-23, which should reduce coffee prices.

Coffee prices doubled to over $2 a pound at the end of 2021

NYC-based Gro Intelligence, which uses AI predict commodity prices, predicts high food price inflation in developing countries whose currencies fall as the Fed raises US interest rates, making imported food more expensive.

States. There are several ways to group states by their major farm commodities. One grouping finds that grains and oilseeds such as soybeans were the most valuable commodity in 16 states, poultry and eggs in nine states, and cattle and milk in seven states each. Fruits, nuts and berries were the most valuable commodities in three states, CA, FL, and WA, and vegetables including potatoes were the most valuable commodity in two states, AZ and ME.

Grains and oilseeds were the major ag commodity in 1/3 of US states


Source: https://howmuch.net/articles/the-most-valuable-agricultural-commodity-per-each-state

References

US Agricultural Trade Data Update.

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