Agricultural Outlook August 2002

Nora Brooks, Economics Editor

Agricultural Outlook No. (293) August 2002

About this magazine

AO is the main source of USDA's farm and food price forecasts. AO emphasizes the short-term outlook for all major areas of the agricultural economy. It also presents long-term analyses of such issues as U.S. agricultural policy, trade forecasts and export-market development, food safety, the environment, and farm financial institutions.

In this report ...

Articles are in Adobe Acrobat PDF format.

Contents, 449 kb

In This Issue, 478 kb

Briefs

• U.S. Red Meat & Poultry Exports May Hit Record Levels in 2003—Total U.S. meat exports are expected to increase nearly 9 percent in 2003 from weak 2002 levels and may approach record measures, likely bolstered by a resolution of recent food safety issues and a stronger world economy. In contrast, total 2002 meat exports will likely decline 8-9 percent from the 2001 record as a result of the strong dollar, slow world economic growth, and animal disease and food safety concerns. Dale Leuck (202) 694-5186, 476 kb.

• Corn & Soybean Plantings Change Little from Spring Intentions—Planted area for the eight major U.S. field crops (corn, sorghum, barley, oats, soybeans, wheat, cotton, and rice) is estimated at 249.1 million acres in 2002, up slightly from last year, based on USDA's Acreage report. Increases in corn, wheat, barley, and oats are partially offset by decreases in soybeans, cotton, rice, and sorghum. Hay area is estimated up more than 1 million acres. William Chambers (202) 694-5312, 515 kb.

Commodity Spotlight

• U.S. Wheat Output & Exports to Decline in 2002/03—Prospects for the lowest U.S. wheat exports in more than 30 years are dominating the 2002/03 U.S. wheat outlook. Smaller U.S. supplies, shrinking global imports, and intense competition are combining to reduce U.S. exports. Despite a further drop in U.S. ending stocks this year, bleak export prospects dampen the price advantages from declining stocks. Projected price range for 2002/03 is $2.75-$3.35 per bushel. Gary Vocke (202) 694-5285, 559 kb.

• Is There a Tobacco Quota Buyout in the Future?—Several tobacco buyout bills have been submitted in Congress that would modify the tobacco program and provide for government purchase of quota from growers or other quota owners. Declining demand for tobacco is limiting the amount of quota available, and use of marketing contracts is reducing the amount of tobacco eligible for price support. Some growers seem ready to accept buyouts and give up price support for greater freedom in production and marketing decisions. Thomas Capehart (202) 694-5311, 529 kb.

Resources and Environment

• Rural Residential Land Use: Tracking Its Growth—Among the most rapidly growing land uses in the U.S. is land for rural residences. Residential land use in rural areas has increased more rapidly than in urban areas, in percentage terms and in absolute numbers. While land in residential use in rural areas is a small proportion of total U.S. land use, this phenomenon has implications for farmland prices and the availability of land for agriculture and forestry, and can affect rural amenities and the rural environment. Marlow Vesterby (202) 694-5528, 592 kb.

World Agriculture & Trade

• The African Growth & Opportunity Act: How Much Opportunity?—For Sub-Saharan Africa (SSA), trade could play a crucial role in economic development. To help create incentives for SSA countries to implement domestic economic and political reforms and improve market opportunities, Congress passed the African Growth and Opportunity Act (AGOA) in May 2000. AGOA provides preferential access to U.S. markets for designated Sub-Saharan countries and improved access to credit and technical expertise. Stacey Rosen (202) 694-5164, 532 kb.

• The Services Sector: Its Role in World Food Production & Trade—Trade in services is growing faster than merchandise trade. In the U.S. and other developed economies the services sector accounts for more than two-thirds of gross domestic product. The food system is increasingly affected by service sector growth-a growing share of consumers' food expenditures and farmers' input costs are for services. It may be time to shift the focus of policy reform from agricultural production to the broader food system. William T. Coyle (202) 694-5216, 552 kb.

• Trade Remedy Laws & Agriculture—Governments of industrialized nations have long employed three basic trade remedies-countervailing duties, antidumping provisions, and safeguards-against imports causing injury to domestic industry. The Uruguay Round of global trade negotiations attempted to discipline inappropriate use of these measures, but they are increasingly employed by World Trade Organization (WTO) members against value-added agricultural products. U.S. agriculture has substantial interest in the outcome of WTO negotiations on these measures in the Doha Round. Anita Regmi (202) 694-5161, 984 kb.

Farm and Rural Communities

• Assessing the Economic Well-Being of Farm Households—While farm income or commodity prices are often cited as indicators of the economic well-being of farm households, the resulting picture is certainly incomplete and most likely distorted. A comprehensive assessment of well-being must consider household wealth as well as income and consumption. Nearly half of all farm operator households had both higher income and higher wealth than all U.S. households in 2000. Ashok Mishra (202) 694-5580, 1,006 kb.

Statistical Indicators, 624 kb.

Entire issue, 1,311 kb.

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Updated date: August 2002