02/14/06 New USDA baseline projections

02/14/06 New USDA baseline projections

Farm and Ranch February 14, 2006 New long term baseline agricultural projections out of the USDA forecast a short term drop in farm income, but USDA chief economist Keith Collins, says in the long term the farm economy will get stronger. Collins: "In 2006 we have a drop in cash receipts reflecting the lower prices we are seeing in the marketplace now. And then over time with a strong U.S. and world economy expected to prevail, we see exports steadily continue to rise. Ethanol becomes a very big demand factor as well as continued growth in exports. The increase in domestic consumption, export demand, exports by the way rise to about 73-billion dollars in the year 2010, and in particular the demand for biofuels, together start to raise farm prices over the next several years." In the baseline projections for wheat, USDA foresees moderate export gains and small increases in domestic use through 2015. U.S. wheat exports increase after 2008/2009 as income and populations in developing countries grow, raising global wheat consumption and trade. USDA says competition from the EU, Canada, Argentina, Australia and exporters from the Black Sea region continues, holding U.S. market share relatively constant at 23 percent. USDA projects wheat prices for U.S. producers to rise slightly though staying between $3 and $4 dollars a bushel. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.
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