joseph w. glauber chief economist, usda usda 89 th agricultural outlook forum february 21, 2013 1
TRANSCRIPT
1
Agricultural Outlook for 2013
Joseph W. GlauberChief Economist, USDA
USDA 89th Agricultural Outlook ForumFebruary 21, 2013
US agricultural exports projected at record high
1980 1985 1990 1995 2000 2005 20100
20
40
60
80
100
120
140
160Bil $
FY 2013 exports: $142.0 bFY 2013 imports: 112.5 b Net trade bal: 29.5 b
Fiscal year
China remains top destination for US agricultural exports for 2nd straight year
1990 1995 2000 2005 2010 2012 20130
5
10
15
20
25
CanadaMexicoJapanEUChina
Bil $
Fiscal year
Soybeans and cotton account for two-thirds of US agricultural exports to China
20002001
20022003
20042005
20062007
20082009
20102011
20122013F
0
5
10
15
20
25
OtherRed Meats, FR/CH/FRFeeds & FoddersHides & SkinsCoarse GrainsCottonSoybeans
Bil $
Export values forecast up in FY 2013 for most commodity categories
WheatRice
CornSoybeans
Beef and vealPork
PoultryDairy products
CottonF&V-fresh
F&V-frozenTree nuts
0 5 10 15 20 25
2013 2012
But export volumes flat or down for most commodities
Wheat
Rice Corn
Soyb
eans
Beef and ve
alPork
Broile
rs
Cotton05
1015202530354045
20122013
+7.4%
+2.7%
-37.5% -4.7%
-4.1% -2.0% n/c -0.6%
Mil mt
Brazil corn exports to surpass U.S. exports?
1998/99
1999/00
2000/01
2001/02
2002/03
2003/04
2004/05
2005/06
2006/07
2007/08
2008/09
2009/10
2010/11
2011/12
2012/13P
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
U.S. Brazil
October-September
Million mt
Source: USDA-FAS monthly trade circular, Grain: World Markets and Trade, February 8, 2013
Global ending stocks tighten for grains
Crop 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13Days of use
Wheat 76 96 112 110 104 96Corn 62 69 65 55 54 50Rice 69 77 79 81 84 80Soybeans 83 72 93 101 80 84Upland Cotton 187 208 144 156 245 281
lowest since 1973/74
China builds cotton inventory
2000/2001
2001/2002
2002/2003
2003/2004
2004/2005
2005/2006
2006/2007
2007/2008
2008/2009
2009/2010
2010/2011
2011/2012
2012/2013
0
10
20
30
40
50
60
70
80
90
Rest of worldChina
Million bales
Much of area exiting CRP is located in Plains states
TEXAS
NEBRASKA
COLORADO
IOWA
SOUTH DAKOTA
KANSAS
MISSOURI
MINNESOTA
MONTANA
NORTH DAKOTA
0 500,000 1,000,000
AcresSource: Farm Service Agency
Planted acres projected to decline in 2013Million acres
Crop 2007 2008 2009 2010 2011 2012 2013F Percentchange
Corn 93.5 86.0 86.4 88.2 91.9 97.2 96.5 -0.7Soybeans 64.7 75.7 77.5 77.4 75.0 77.2 77.5 +0.4Wheat 60.5 63.2 59.2 53.6 54.4 55.7 56.0 +0.5Upland cotton 10.5 9.3 9.0 10.8 14.4 12.1 9.8 -19.0Minor feed grains 15.5 15.8 13.6 11.4 10.6 12.6 12.9 +2.4Rice 2.8 3.0 3.1 3.6 2.7 2.7 2.6 -3.7 Total 8 crops 247.5 253.0 248.7 245.0 249.0 257.5 255.3 -0.9CRP 36.8 34.6 33.7 31.4 31.2 29.5 27.1 -8.18 crops + CRP 284.3 287.6 282.4 276.4 280.2 287.0 282.4 -1.6
Drought persists across much of the United States
Corn and soybean production projected to rebound in 2013
Crop Unit 2012 2013 Change
Corn Mil bu 10,780 14,530 34.8%
Soybeans Mil bu 3,015 3,405 12.9%
Cotton Mil bales 17.0 14.0 -17.7%
Rice Mil cwt 199.5 192.0 -3.8%
Wheat Mil bu 2,269 2,100 -7.4%
Preseason precipitation and Iowa corn yields
-8 -6 -4 -2 0 2 4 6 8-60-50-40-30-20-10
010203040
Deviation from Sep-Jan average precipitation (inches)
Dev
iatio
n fr
om tr
end
(bu/
acre
) Corr= 0.059
Weekly ethanol production below RFS caps for conventional biofuels
Jun 04, 2010 Dec 03, 2010 Jun 03, 2011 Dec 02, 2011 Jun 01, 2012 Nov 30, 201210
11
12
13
14
15
16
Ann
ualiz
ed p
rodu
ction
(bil
gal)
Source: DOE-Energy Information Administration, Weekly Petroleum Status Report.
US corn use for ethanol rebounds, but below 5 billion bushels
1998/99
1999/00
2000/01
2001/02
2002/03
2003/04
2004/05
2005/06
2006/07
2007/08
2008/09
2009/10
2010/11
2011/12
2012/13
2013/14F
0
1,000
2,000
3,000
4,000
5,000
6,000
0
5
10
15
20
25
30
35
40
Ethanol corn use Ethanol share of corn use (%)
PercentMil bushels
Motor gasoline use projected to decline
20102012
20142016
20182020
20222024
20262028
20302032
20342036
20382040
100
110
120
130
140
150
160
AEO2013AEO2011AEO2008
Source: DOE--Energy Information Administration, Annual Energy Outlook
Bil gal
Commodity prices fall from record levelsCrop 2009/10 2010/11 2011/12 2012/13 2013/14F % Change
2011-12Wheat 4.87 5.70 7.24 7.90 7.00 -11.4%Corn 3.55 5.18 6.22 7.20 4.80 -33.3%Soybeans 9.59 11.30 12.50 14.30 10.50 -26.6%Rice 14.40 12.70 14.50 14.90 15.20 +2.0%Cotton 62.9 81.5 88.3 71.0 73.0 +2.8%
Source: USDA-NASS and Office of the Chief Economist, February 2013
Wheat, corn and soybeans in dollars per bushel; rice in dollars per hundredweight;cotton in cents per pound. Numbers in red denote record levels.
High feed costs keep feed ratios at low levels
Jan-05
Jun-05
Nov-05
Apr-06
Sep-06
Feb-07
Jul-0
7
Dec-07
May
-08
Oct-08
Mar-
09
Aug-09Jan
-10
Jun-10
Nov-10
Apr-11
Sep-11
Feb-12
Jul-1
2
Dec-12
0123456789
0
5
10
15
20
25
30
Dairy Broilers Hogs
Dairy and Broilers Hogs
20
Livestock, dairy and poultry prices projected to increase in 2013
Animal products
2009 2010 2011 2012 2013F % Change2012-13
Dollars per cwt
Cattle 83.25 95.38 114.73 122.86 129.50 5.4 Hogs 41.24 55.06 66.11 60.88 63.00 3.5 Broilers 77.60 82.90 79.90 86.6 95.00 9.7 Milk 12.83 16.26 20.14 18.51 19.25 4.0
Source: Office of the Chief Economist, February 2013
Prices in red denote record levels.
Food CPI to rise in 2013 but likely to remain below levels in 2008 and 2011
Jan-07
Jun-07
Nov-07
Apr-08
Sep-08
Feb-09
Jul-0
9
Dec-09
May
-10
Oct-
10
Mar-
11
Aug-11
Jan-12
Jun-12
Nov-12
-4
-2
0
2
4
6
8
10
all foodat home
Perc
ent y
ear-
over
-yea
r cha
nge
ERS forecast:3.0-4.0% for 2013
Net cash income projected to fall in 2013, but remain high relative to historical levels
19901992
19941996
19982000
20022004
20062008
20102012F
0
50
100
150
200
250
300
350
400
450392.9
316.6
123.5
Cash receipts Expenses Net cash income
Bil dollars
Net cash income projected to fall for most crop producers
Wheat Corn Soybeans and peanuts
Cotton and rice
Specialty crops
0
50
100
150
200
250
300
2009201020112012F2013F
$ thou
Source: Economic Research Service
Net cash income for livestock producers expected to decline in 2013
Beef cattle Hogs Poultry Dairy0
50
100
150
200
250
300
350
2009201020112012F2013F
$ thou
Source: Economic Research Service