2015 USDA Agricultural Outlook Forum
Thursday USDA Acting Chief Economist Robert Johansson made a presentation on the current agricultural landscape during the 2015 USDA Agricultural Outlook Forum. Interestingly, he set the tone by showing how commodity prices have been trending downward for more than 60 years.
Even more amazing is that, on average, Americans have steadily spent less on food each decade for the past 9 decades. Nearly 25% of disposable income was used to purchase food in the 1930’s. This number has now dropped to about 10%.
The Acting Chief Economist took up commodity crops in detail. He explained global supplies of wheat, corn, and soybeans are plentiful. The planet he says will have more than 113 days of soybeans at the end of the marketing year. This is a record supply. However, demand for the miracle crop remains very strong with most of the world’s soybean exports going to China. These are primarily supplied by the United States, Brazil, and Argentina.
The U.S. is expected to be the planet’s largest exporter of soybeans for the 2015/16 marketing year, but Brazil should take that title for 2016/17 and beyond. USDA projects Brazil’s market share of soybean exports will grow to 46% by 2024 while the U.S.’ share is expected to fall to 33%.
The U.S. is expected to remain the world’s largest exporter of corn with its share of the global corn trade growing from 40% in 2015/16 to 45% over the next 10 years.
This year the Agricultural Outlook Forum projects U.S. farmers are likely to plant 89 million acres of corn and 83.5 million acres of soybeans. Johansson says the marketing year average cash price for fall 2015 corn is expected to be $3.50 per bushel. The MYA soybean price is forecast at $9 per bushel.
The number of acres sown to coarse grains like barley, oats and sorghum are expected to go up based on strong demand from China. Chinese demand has propped up sorghum prices and export demand for these feed grains.
USDA reports overall acreage at about 255 million, down 3.3 million from last year. CRP acreage is also expected to decline.