American farmers will harvest monster corn and soybean crops this year, including the largest soybean crop ever, at 4.5 billion bushels, and the third corn crop in four years to top 15 billion bushels, projected the Agriculture Department on Thursday. Season-average prices for the crops would fall for the second year in a row from the spike in commodity markets created by Russia’s invasion of Ukraine in 2022.
After soaring to sky-high levels following Russia's invasion of Ukraine, U.S. corn, soybean, and wheat prices are coming back to earth as supplies expand worldwide, said the Agriculture Department. The average price for corn this marketing year will be 27 percent lower, wheat 18 percent lower, and soybeans 10 percent lower than last season, said USDA analysts in a new look at global supply and demand.
Commodity prices soared when Russia invaded Ukraine in February 2022 amid fears of grain shortages with two of the world's leading grain exporters engaged in war. Instead, global production of grains and oilseeds has exceeded forecasts based on production before the invasion, said four agricultural economists on Monday.
Growers are expected to sow the largest amount of U.S. land to winter wheat in nine years, encouraged by strong market prices, in part a result of warfare in Ukraine, and forecasts of better growing conditions in the drought-hit central and southern Plains. Winter wheat accounts for roughly seven of every 10 bushels of wheat harvested in the nation.
Farmers in the top corn, wheat, soybean, and hog states are twice as likely as farmers in smaller-volume states to use precision agriculture practices, such as GPS guidance, said the USDA’s farm computer report on Thursday. Usage often topped 50 percent in the top row-crop states, while the U.S. average was just 27 percent.
The wealthy nations of the world will spend $1.2 trillion this year on food imports that include meat, fish, coffee and spices, while poorer nations tighten their belts and focus on staple foods such as grains, said the UN Food and Agriculture Organization. "The decline in food import volumes is a concerning development," said the report, "suggesting a decline in purchasing capacity."
Nearly half of the U.S. winter wheat crop is in drought but its condition improved slightly in the past week, said the USDA on Tuesday. The weekly Crop Progress report also showed growers in the upper Midwest were rushing through corn and soybean planting after a slow start due to cold and wet weather.
Three of every 10 acres of U.S. corn and winter wheat are under increased threat as climate change boosts temperatures and makes rainfall more erratic in the Midwest and Plains, said new report on Tuesday. Commissioned by the American Farmland Trust, the report said the 2023 farm bill should embrace climate mitigation and provide the money to help farmers adapt to global warming.
Some of the world’s agricultural powerhouses accused India on Thursday of violating world trade rules through exorbitant subsidies for its wheat and rice farmers. India was the ninth-largest farm exporter in the world in 2020, but its success was built on subsidized production, said Australia, Canada, Paraguay, Thailand, Ukraine, and the United States in a WTO filing.
The commonly used estimates of global wheat stocks are imperfect — some countries don’t publish data at all — but they indicate supplies, disrupted by the war in Ukraine, are the tightest since the food price crisis of 2007/08, said a blog by the IFPRI think tank.
Low producer prices and high input costs will discourage grain production in Ukraine this year, said an IFPRI blog, as the Russian invasion of its neighbor hit the one-year mark. “Reduced plantings in Ukraine mean that the world will need to produce additional grains and oilseeds to help rebuild stocks and moderate price levels,” wrote IFPRI senior research fellow Joe Glauber on Thursday.
Economic growth and inflation will slow in the coming months, but commodity prices are likely to be volatile as the world’s farmers try to catch up with the global appetite for food, said two leading agricultural economists on Wednesday. “I think that 2023 still looks pretty strong” for U.S. farm income, said Nathan Kaufman, the Kansas City Federal Reserve Bank’s principal expert on agriculture economics.
Only 28 percent of the U.S. winter wheat crop is in good or excellent condition, one of the worst starts for the crop in years, said the USDA's Crop Progress report on Monday. Three-quarters of winter wheat land is in drought, including nine of every 10 acres in Kansas, the top wheat producing state.
U.S. and Canadian farmers plowed up about 1.8 million acres of Great Plains grasslands to plant crops in 2020, according to a report released Tuesday by the World Wildlife Federation. The report also showed that, for the first time since 2016, wheat surpassed corn and soy as the leading crop driving annual grasslands loss across the entirety of the Great Plains, and not just within the northern Great Plains.
Winter will be drier and warmer than usual for the central to southern Plains and the Southeast, said government forecasters on Thursday, suggesting there would be little drought relief in major wheat-growing states or precipitation to restore water levels in the Mississippi River. It would be the third U.S. winter in a row under the La Niña pattern, which typically brings warmer and drier weather to the U.S. southern tier, from California to the Carolinas.
For decades, farmers in the Midwest and Plains have reaped ever-higher yields per acre, but “climate change threatens to slow or reverse this productivity as soon as 2030,” said the Environmental Defense Fund on Wednesday. The “climate burdens” would worsen through 2050, the nonprofit group said in a report.
Ukrainian farmers may reduce plantings of wheat and other crops for harvest in 2023 because warfare has reduced their income at the same time they face high fuel and fertilizer costs, said two IFPRI analysts during a briefing on Tuesday. A small crop in Ukraine, usually a leading wheat and sunflower oil exporter, could prolong tight global supplies that have driven up grain prices worldwide.
Market prices for U.S. corn, soy, wheat and cotton will retreat sharply in the 2023-24 marketing year with normal weather and yields around the world, FAPRI said in an update to its agricultural baseline. However, it expects record wheat and cotton prices in 2022-23.