After soaring at the start of this decade, season-average prices for the three major U.S. crops will drop to pre-pandemic levels and stay there for the near term, said a University of Missouri think tank on Thursday. Cattle would be the most notable exception to an overall decline in crop and livestock values.
“The value of crop sales declines in 2024, as the effect of lower prices outweighs the effect of increased production for many crops,” said the Food and Agricultural Policy Research Institute (FAPRI) in a midyear update of its agricultural baseline.
“Assuming average growing conditions in future years, projected prices remain near 2024/25 levels for many crops,” it said. “Between 2025/26 and 2029/30, corn prices average $4.12 per bushel, soybeans average $9.98 per bushel, and wheat prices average $5.70 per bushel.”
Those would be the lowest farm-gate prices for corn and soybeans since the 2019 crops and the lowest for wheat since the 2020 crop, according to USDA data.
Lower commodity prices and rising production costs are forecast by the USDA to pull down net farm income, a measure of profitability, this year. While farm income has fallen sharply from its peak in 2022 during the commodity boom, it will remain far above its 10-year average, the USDA estimated in February. An updated forecast is scheduled for Sept. 5.
Farm groups say the new farm bill should increase so-called reference prices — which would make it easier to trigger crop subsidy payments — because of the squeeze between lower revenue and high costs. Progress in Congress on the legislation is deadlocked in part over Republican proposals to offset higher farm spending by cutting SNAP funding and Democratic defense of SNAP. Senate Agriculture Committee chair Debbie Stabenow has suggested a smaller increase in reference prices than the 15 percent sought by Republicans.
With a record soybean harvest on the horizon, FAPRI projected that this year’s crop would sell for an average of $9.99 a bushel, and that the expected bumper corn crop, the second in two years to top 15 billion bushels, would sell for an average of $4.10 a bushel. Earlier this month, the USDA said the season-average prices would be higher — $4.20 a bushel for corn and $10.80 for soybeans.
“Increased supplies, a strong dollar, and several other factors have caused prices for many agricultural commodities to fall sharply from their 2022 peak levels,” said FAPRI. “In the absence of new shocks to the weather, the macroeconomy, or policy, projected prices generally remain near current levels over the next five years.”
Cattle prices would remain strong through the end of the decade due to high consumer demand and constrained supply, said FAPRI. Hog prices would begin to improve in 2026 as hog slaughter slows. Poultry production would rise modestly through 2029. The all-milk price would run slightly below $21 per 100 pounds of milk.
U.S. meat consumption was projected to reach a record 227.1 pounds per person in 2029, or nearly 10 ounces a day, said FAPRI. That would be 2.5 pounds more than this year as beef, pork, and broiler chicken supplies grow.