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USDA Releases Agricultural Baseline Projections

The USDA Office of the Chief Economist has released the Agricultural Projections for 2010-2019. These projections, released annually, provide a 10-year look at the farm sector covering agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices.

The projections are a conditional scenario based on specific assumptions and are not intended to be a forecast of what the future will be, but instead are a description of what would be expected to happen under very specific external circumstances and assumptions. The projections in this report were prepared during October through December 2009 and reflect a composite of model results and judgment-based analyses.

Assumptions important to the projections include continued economic recovery of the U.S. and global economy, resumption of global economic growth will support longrun increases in trade, consumption and prices, and demand will continue to grow for biofuels.

Among the key results of the projections is the expectation of continued high prices for corn, oilseeds and other crops. In the livestock sector continued adjustment to higher grain and soybean meal prices is expected during the first several years of the projections with lower production at higher prices, which will improve net returns and provide economic incentives for moderate expansion in the sector later in the projection period.

Demand for biofuels and food globally after the recession provides a major impetus for strengthening cash receipts and moderate gains in net farm income. Also, from 2010 to 2012 food prices in the U.S. are expected to rise faster than inflation, though are expected to rise slower than inflation during the second half of the decade.

To view the USDA Agricultural Projections for 2010-2019, click HERE.