What is in this article?:
- Grain prices likely to drive US agriculture in 2013
- Grain crops promising
- Cotton, livestock
- Near record low stocks of grain will keep demand high and prices good for farmers through the 2013 season.
- The news is not universally good for farmers. Livestock and dairy farmers will continue to be in a high stress economic situation due to continually increasing grain prices, economists contend.
Grain crops promising
Among the primary crops planted in the region, economists speaking at the Tennessee agricultural forum agreed that grain crops will likely remain a good crop for Southeastern growers, while traditional crops like cotton and peanuts may face a difficult time competing for acreage.
Though not considered by some to be a traditional southern crop, wheat acreage over the past few years has continued to climb, especially in the upper Southeast.
From 2010 until 2012 in the United States, wheat prices have increased by 42 percent and use for livestock feed has increased an astounding 238 percent.
During the same time, U.S. wheat exports were down by 11 percent and food and seed use was up 3 percent. The small increase in food and seed use was driven primarily by an increase in demand for wheat seed.
Uncertainties over the U.S. corn crop in 2012 are dominating world markets, according to Barr. He notes that U.S. corn yields declined for the third year in a row in 2012.
In June of 2012, the USDA estimated corn yields would be 163 bushels per acre. Following one of the worst droughts in history in the Midwest that yield estimate is now down to 122 bushels per acre.
Production declines over the past three years have driven domestic use for corn down from 13 billion bushels in 2010 down to an estimated 11 billion bushels in 2012. Use is projected to continue to decline in 2013.
In 2012 corn stocks were at their lowest levels since 1995. In the past year corn used for ethanol in the U.S. is down 25 percent, feed use is down 9 percent and corn exports are down 25 percent. During that same time, corn prices have increased by 26 percent.