Publications

Agricultural Outlook

December 1997

Economics Editor: Randy Schnepf, rschnepf@ERS.USDA.gov

This issue was published in December 1997 by the Market and Trade Economics Division.

Agricultural Outlook is published 10 times per year by the Economic Research Service, U.S. Department of Agriculture. To order Agricultural Outlook, please visit the ERS-NASS Sales Desk. The contents section at the bottom of this page links to each article in Adobe Acrobat PDF format.

In This Issue...

WHAT IS INFLUENCING WORLD BEEF TRADE PATTERNS? -- Increases in global incomes and a more liberalized trading environment have contributed to substantial growth in international beef trade over the past 15 years. Changing production, marketing, and political conditions, as well as health and sanitary trade barriers and cultural factors, have played an important role in the evolution of beef markets. These factors are likely to continue to exert a strong influence on meat production and trade patterns as meat trade continues to expand through the next decade and as meat demand rises in countries with rapidly industrializing and transition economies. For more information on this topic, contact: Shayle Shagam, (202) 694-5186.

CATTLE CYCLE UNLIKELY TO TURN BEFORE 2000 -- The much-anticipated turn in the cattle cycle--when the nation�s cattle herd will again begin to expand--appears unlikely to occur before 2000. With disappointing pasture and range conditions and record-high hay prices, heifer slaughter for the first 9 months of 1997 was at a near-record pace. Although beef cow slaughter has been down since spring and is expected to decline even further over the next couple of years, without retention and breeding of larger numbers of heifers, beef cow numbers will continue to decline at least through 1998, delaying expansion in the cattle herd until after the turn of the century. For more information on this topic, contact: Ron Gustafson (202) 694-5174.

INTERPRETING MEAT INDUSTRY PRICE SPREADS -- The farm-to-retail price spread for pork reached a record $1.62 per pound in October. Current price spreads for Choice beef and broilers are also relatively high. Yet the most compelling feature of price spreads for these meats is that, when adjusted for inflation, they have remained fairly constant or even decreased slightly over the past three decades. By examining price spreads and their components, the timeliness and completeness of price adjustments among marketing levels, as well as variations in marketing spreads, can be monitored over time. For more information on this topic, contact: Kenneth Nelson, (202) 694-5185.

VALUE OF FARM REAL ESTATE UP AGAIN FOR 1996 -- Agricultural real estate values in the U.S. continued to climb during 1996. USDA's estimate for the national average value of all agricultural real estate (land and buildings) as of January 1, 1997 is $942 per acre, up 5.8 percent from a year earlier--3.8 percent in inflation-adjusted terms. Among the most influential agricultural factors in farmland values are growing conditions and capital investments, including irrigation. Among nonfarm factors, the demand for farmland in urban and urbanizing areas is the predominant influence on farmland values. For more information on this topic, contact: Dave Westenbarger, (202) 694-5626.

CONSUMERS MAY BENEFIT AS PORK INDUSTRY CHANGES -- How the hog industry is organized and how it does business ultimately affects consumers. Hog production for the open market is being replaced by multi-year contracts and vertical integration (e.g., processors owning hog production facilities). These changing producer-to-packer methods can reduce packing costs and improve the quality of pork products. Packers may reduce costs by obtaining a large, stable flow of hogs to minimize under- or overutilization of facilities, as well as by increasing control over hog quality. Consumers stand to benefit through lower prices and/or an increased supply of higher quality pork products. For more information on this topic, contact: Steve Martinez, (202) 694-5378.

This publication is in Adobe Acrobat PDF format. You can download and get help using the Adobe Acrobat Reader to view and print this document. PDF format is used to preserve the layout as it appears in the printed publication. Text-only versions of Agricultural Outlook are also available from Mann Library. The text versions are available immediately after publication clearance.

Contents

In This Issue..., 28kb

Briefs, 56kb