USDA has released its agricultural projections to 2032! These baseline projections provide insight into the landscape of agricultural commodities and trade for the next ten years.
The U.S. agricultural sector has been influenced by global economic and market circumstances such as inflation, supply chain disruptions, drought and other weather events, high input costs, and Russia’s war against Ukraine. These circumstances have pressured commodity prices above what we have seen historically.
Despite this, export levels of four major U.S. field crops are expected to rise over the next decade. Wheat exports are expected to rise from the 50-year low projected for 2022/23, corn and soybean exports are projected to rise to nearly meet prior records, and upland cotton is expected to reach record levels by the end of the projection period. Nominal prices for all four of these commodities are expected to decline over the next three years from their peaks witnessed in 2021 through 2023 and then generally stabilize.
As for the livestock-poultry baseline, drought recovery, modest rates of real GDP (gross domestic product) growth, and moderating feedstock prices are key. Drought conditions that began in late 2020 forced a reduction in cattle numbers that continues to constrain beef production. Modest increases in beef production rates are expected while cattle numbers rebuild in the next few years. This weak beef production is offset by consistent, moderate growth of both pork and poultry production. Production and exports of all three major meat categories are expected to increase over the projected period. Prices for poultry and beef are expected to remain high over the projected period, while pork prices are expected to decline after 2024 due to increased production and competition with other meats.
Using data released by the U.S. Department of Commerce, Bureau of the Census on Nov. 2, 2022, USDA projects that U.S. agricultural trade will be significantly influenced by inflation and the strength of the U.S. dollar. U.S. agricultural exports are expected to decrease in 2023 while agricultural imports are expected to increase. Macroeconomic conditions are expected to be most impactful on U.S. agricultural trade from 2023 to 2025, slowing U.S. exports earlier than imports and leading to a negative trade balance.
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