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U.S. rice production is projected to decline 6 percent in 2015

Thursday, September 1, 2016

Rice acreage for 2015 is estimated at 2.77 million acres, down 6 percent from last year and 5 percent from March planting intentions. Rice acreage is down in all major producing States, reflecting low prices?especially for long-grain varieties?as well as drought in California, a cool and wet spring across much of the South, and continued water restrictions in Texas. California is reporting the largest percentage decline (11 percent) in rice area, which is the lowest since 1991/92. The 2015 decline follows a 23-percent reduction in rice acreage last year. The large, multi-year declines in California rice area reflect 4 consecutive years of severe drought.? Growers in Texas have also faced tightening water restrictions for the past 4 years, and 2015 acreage is down around 20 percent from pre-drought levels, leaving it with the smallest acreage of any rice-producing State. Arkansas?the largest rice-producing State?accounts for more than half of the decline in U.S. rice area this year, with a drop in acreage of more than 6 percent. Arkansas produces both long-grain and medium-grain rice; low prices and unfavorable weather are behind a 9-percent decline in long-grain plantings, while medium-grain plantings in Arkansas increased 25,000 acres (12 percent) this year due to the expectation of favorable prices caused by California?s medium-grain shortfall. Louisiana and Mississippi are also reporting declines in rice acreage this year. This chart is from the July 2015 Rice Outlook report.

Imports supply about a third of U.S. watermelon consumption

Thursday, September 1, 2016

The majority of watermelons consumed in the United States are produced domestically, but imports have grown rapidly in recent years. Watermelon acreage in the United States has declined by about 50 percent since the early 1990's, but increases in productivity from a greater use of irrigation and improved varieties helped keep annual production levels above 3.5 billion pounds through most of the past 20 years. Watermelons can be grown in most parts of the United States but do best in the South due to long growing season and consistently warm temperatures. Florida, Texas, California, Georgia, and South Carolina account for over 70 percent of U.S. production. While domestic production has trended lower over the past five years, the U.S. appetite for watermelons has not. From 2010-15, watermelon domestic use has grown to an average 4.9 billion pounds annually, aided in part by four consecutive years of record-high imports, reaching 1.5 billion pounds in 2015. Watermelon imports continue to grow, and accounted for a third of domestic use in 2015, up from 11 percent in 2000 and 7 percent in 1990. Most watermelons imported to the United States come from Mexico, followed by Guatemala and Honduras. This chart is based on data found in the ERS's report "Fruit and Tree Nuts Outlook: March 2016".

U.S. animal protein exports are declining

Thursday, September 1, 2016

Recent trade data for red meat, poultry and dairy products show a continuing decline in exports and higher year-over-year imports, pushing the value of net exports down by more than 50 percent compared to a year ago. The strengthening value of the U.S. dollar?which is up more than 15 percent from a year ago against major currencies?is one factor behind these results. A stronger dollar makes U.S. products more expensive in international markets, while making imported products purchased with U.S. dollars less expensive. In addition to currency exchange-rate effects, several other factors are reducing the export prospects for the U.S. beef, poultry, and egg sectors. For beef, continued high U.S. domestic prices due to tight supplies are discouraging foreign buyers and supporting U.S. imports. U.S. export shipments of broilers, turkeys, and eggs are each down sharply from the same time last year (down 22 percent, 44 percent and 29 percent, respectively) reflecting the production declines caused by the U.S. outbreak of highly pathogenic avian influenza (HPAI) last spring and the resulting import bans by several countries that remain in effect. Pork exports were relatively strong in the third quarter of 2015, up 7.5 percent from a year ago, but imports were also up 5 from percent from a year ago, reflecting the strength of the U.S. dollar especially against the Canadian dollar and the euro. This chart is from the November 2015?Livestock, Dairy and Poultry Outlook?report. ?

Brazil and Ukraine emerge as major corn exporters

Thursday, September 1, 2016

Over the last 5 years, the role of Brazil and Ukraine as suppliers of global corn markets has expanded rapidly, and in 2013/14 Brazil and Ukraine became the largest corn exporters after the United States. For both countries, technical developments over the last decade, coupled with a period of relatively strong world corn prices, supported a rapid increase in area dedicated to corn. In Brazil, shorter-maturing varieties allowed corn to increasingly be grown as a second crop after soybeans, instead of as a main crop in competition with soybeans. In Ukraine, corn production expanded and shifted northward, again aided by shorter-season high-yielding varieties. While global corn prices have fallen over the past few years, the exchange rate for Brazil and Ukraine has also devalued, offsetting much of the price decline. This chart is from the September 2015 Feed Outlook report.

Per capita food spending varies more internationally than per capita food availability

Thursday, September 1, 2016

Per capita food-at-home spending differs widely across countries. For example, in 2011 food-at-home spending was $2,239 per person in the United States, $452 in lower middle-income Cameroon, and just $276 in low-income Kenya. However, higher food spending does not always translate into higher food consumption. South African consumers, for example, spent more per person on at-home foods than Chinese consumers, but per person calories available for consumption were about the same in both countries. Japanese consumers outspent U.S. consumers on at-home foods, but per person calorie availability in Japan was lower. At-home food spending reflects general food price levels, prices for the particular foods purchased (grains versus meats), and, for higher income countries, the mix of at-home and away-from-home eating. While the average consumer in the United States spends more than 8 times as much on food at home as the average person in Kenya, per capita calorie availability is less than 80 percent higher. All eight countries had per capita calorie availability over 2,000 per day, but averages can mask large differences in food spending, access, and consumption within a country. This chart is based on data from the ERS Food Expenditures data product, updated October 2012.

Thailand's rice production at lowest level since 2004/05

Thursday, September 1, 2016

Thailand?s 2015/16 rice production (January/December marketing year) is forecast down 4 percent from last year and will be the lowest since 2004/05. The production decline is due to a second consecutive year of drought and resulting low reservoir levels. Planted area is forecast to fall to 10.2 million hectares for 2015/16, down from 10.92 million in 2013/14, before the current drought began; yields have dropped as well. The USDA area forecast was lowered in August based on Government statements informing growers that they will receive only 50 percent of normal dry-season irrigation water due to the low reservoir levels. In addition to less-than-adequate rainfall in 2014, less-than-normal rainfall at the beginning of the 2015 monsoon season in the central growing region in May and June also contributed to the low reservoir levels. This is the second consecutive year of a drought-reduced rice crop in Thailand. Thailand is typically the largest or near-largest rice exporting country, but exports for the 2015 calendar year are forecast about 18 percent below last year.? Exports are forecast to rebound in 2016, but continued low reservoir levels and limited availability of irrigation water could impact the upcoming crop and export prospects. This chart is from the August 2015 Rice Outlook report.

Poultry consumption grows with income in the Middle East and North Africa

Thursday, September 1, 2016

Meat consumption is correlated with income around the world, and the Middle East and North Africa (MENA) region is no exception. While income levels vary widely across the region, income growth continues to outpace the world average with implications for MENA?s future meat demand, particularly poultry. Per capita meat consumption has more than doubled from around 12 kilograms (kg) in the 1990s to about 24 kg in 2010, and USDA?s Baseline Projections suggest this growth will continue well into the future. As with other commodities, the growth of poultry consumption has exceeded gains in domestic production, leading to rising imports, and MENA is now the largest regional importer of poultry products in the world. Domestic meat production is also growing rapidly; regional poultry production grew by nearly 5 percent annually from 2000 to 2011, leading to growth in demand for animal feeds, primarily corn and soybean meal. The chart is from Middle East and North Africa Region: An Important Driver of World Agricultural Trade.

Global rice stocks are declining

Thursday, September 1, 2016

Rice consumption worldwide is expected to exceed production for the third consecutive year in 2015/16, resulting in the smallest global ending stocks since the 2007/08 marketing year. Ending stocks among the world?s five leading rice exporters?India, Thailand, Vietnam, Pakistan and the United States?are projected down a combined 33 percent from last year and 47 percent below the peak levels of 2012/13. These countries account for the bulk of the decline in global stocks. The last time stocks were near these levels in 2007/08, prices rose to their highest nominal level on record, prompted by export bans by Egypt, India, and Vietnam and fears of rice shortages in countries where rice is a staple food. Today the market situation is far different, with global rice prices relatively flat since late August 2015 after trending lower for the previous several years. However, the low stocks held by major exporters suggest that in the event of a major weather problem in any large rice consuming country, prices could rise rapidly since little surplus rice would be available to meet consumer needs. This chart is from the November 2015?Rice Outlook?report.

U.S. stocks of natural cheese are at the highest levels since 1984

Thursday, September 1, 2016

The volume of natural cheese held in cold storage in the United States has grown to 1.214 billion pounds as of the end of April 2016, the highest level since March 1984. However, unlike 1984, inventories today are almost exclusively privately held and reflect the needs of a growing market instead of the consequence of government policy. In the 1980s, the Milk Price Support Program was very active in purchasing large quantities of cheese to support dairy prices. The U.S. Government owned about 60 percent of cheese stocks, which it often distributed through food donation programs in the United States and abroad.?In recent years, government purchases of dairy products fell to zero as market prices exceeded support prices, and the Milk Price Support Program was repealed by the 2014 Farm Act. At the same time, commercial cheese stocks have grown to help meet the growing demand for cheese. Total commercial use of cheese (which does not include government donations) grew from 4.6 billion pounds in 1984 to 11.9 billion pounds in 2015, due to population growth as well as increasing consumption per capita and higher exports. Commercial cheese stocks have been growing particularly fast in recent months, reflecting an increasing milk supply, relatively low export demand, and anticipation of further growth in the domestic market. This chart is based on the May 2016 Livestock, Dairy and Poultry Outlook report and the ERS Dairy Data product.

U.S. rice production declined 13 percent in 2015

Thursday, September 1, 2016

U.S. rice production declined 13 percent in 2015/16 (August-July) to 192.3 million hundredweight (cwt), down 29.9 cwt from a year earlier. The decline in production was the result of both smaller plantings and a lower average yield. At 2.614 million acres, 2015/16 rice plantings were 11.5 percent below a year earlier, primarily reflecting weather-related problems that included excessive rain in the Mississippi Delta early in the growing season and long-term drought in California and Texas. The U.S. average yield of 7,470 pounds per acre was 1.4 percent below a year earlier, largely due to the adverse weather in much of the South that delayed plantings and interfered with field operations during the growing season. Despite the sharp decline in the 2015 crop, U.S. supplies are projected to contract by only 5 percent due to the substantial quantity of rice that was carried over from the previous year, when production reached the fourth highest level on record due to strong prices and normal weather in the South that boosted acreage. This chart is from the Rice Outlook, March 2016.

Milk-cow numbers turn higher and output per cow continues to grow

Thursday, September 1, 2016

The number of milk cows in the United States was up slightly in 2015, reaching 9.3 million, about equal to the number in 2008. The size of the U.S. dairy herd reached an historic low of just over 9 million cows in 2004, following a long-term decline of more than 2 million head since 1983. Over the past decade, the herd size has grown slightly, by an average of 0.3 percent per year. Improving technology and genetics have allowed milk output per cow to rise steadily, increasing by 88 percent since 1980 and reaching a record-high annual average of 22,393 pounds of milk per cow in 2015. The result has been strong growth in U.S. milk production over the period, which corresponds to growing domestic and international markets for dairy products?particularly for cheese and various dairy-based food ingredients. This chart is based on the ERS Dairy Data product.

Exports as a share of red meat and poultry production expected to increase in 2016, while dairy's export share declines

Thursday, September 1, 2016

In 2015, approximately 15 percent of total U.S. red meat and poultry production and 18 percent of dairy production (on a skim solids milk equivalent basis) were sold in export markets. Red meat and poultry exports as a share of production are down from the average over the previous 5 years, reflecting the combination of a strengthening dollar, slowing global economy, and restrictions on poultry exports put in place as a result of the U.S. outbreak of highly pathogenic avian influenza (HPAI). However, for dairy products, exports as a share of production grew modestly in 2015 relative to the previous 5 years, reaching 18 percent. In 2016, production of red meat and poultry is expected to increase, while exports are expected to grow even more, resulting in higher export shares for beef, pork, broilers and turkey. For dairy, production is expected to increase and exports are expected to decline from 2015, causing dairy?s export share of production to be lower than last year. This chart is from Livestock, Dairy and Poultry Outlook, March 2016.

Residents of low-income countries devote a greater share of their total spending to food

Thursday, September 1, 2016

At-home food spending as a share of consumption expenditures varies between countries, with higher income countries spending a relatively small share and lower income countries spending a larger share. The United States has the lowest at-home food spending share and Cameroon one of the highest. Consumption expenditures include personal spending on goods and services in the domestic market. As incomes rise, food spending typically increases in absolute terms, but declines as a share of total consumption expenditures. Between 2008 and 2011, food spending as a share of consumption expenditures remained relatively flat in both the United States and Japan. Food spending's share in the other six countries fell during this time, especially in India which saw large increases in income and total consumption expenditures. This chart is based on data from the ERS Food Expenditure Series data product, updated October 2012.

Dairy product prices are declining

Thursday, September 1, 2016

The U.S. domestic wholesale prices of nonfat dry milk (NDM) have declined from a record high of $2.090 per pound in March 2014 to $0.837 per pound in July 2015, the lowest price since May 2009.? International export prices for skim milk powder (SMP) are also declining, reaching $0.792 per pound in July for Oceania and $0.851 per pound for Western Europe. Since the U.S. market for NDM is highly dependent upon exports (52 percent of production was exported in 2014), domestic prices track closely with international prices. The domestic wholesale price for dry whey, which is also highly dependent upon exports, fell from 42.5 cents in June to 39.4 cents in July, the lowest level since January 2011. Domestic prices for butter and cheese have not fallen as much since those markets are not as dependent upon exports.? The declining prices reflect weak global demand, particularly from China, and the Russian import ban on dairy products from major producers. With lower dairy product prices, milk prices are also declining, with the all-milk price currently forecast to average $16.75-$16.95 per hundredweight in 2015, down from an average of $23.97 in 2014. This chart is from the August 2015 Livestock, Dairy and Poultry Outlook report.

Fed steer prices fall from historic highs

Thursday, September 1, 2016

Although 2015 fed steer supplies remain historically small, prices have recently fallen from the record high levels reached during the first and second quarters of 2015. Prices have been trending lower since April 2015, and in July and August fell below the levels of the same time a year ago. The recent decline in fed steer prices is driven by negative margins faced by packers during the summer months. As a result, slaughter data suggests packers may have slowed the pace of slaughter to improve their margins, subsequently driving fed steer prices lower. A continued reluctance of packers to expand their slaughter could put further downward pressure on the price of these cattle in the months ahead, especially if it creates a backlog of fed steer supplies into the fourth quarter, when demand typically shifts away from grilling items to traditional holiday items such as turkeys and hams, easing wholesale beef prices. This chart is from the September 2015 Livestock, Dairy, and Poultry report.

The share of world population that is food insecure is projected to decline

Thursday, September 1, 2016

The latest International Food Security Assessment suggests food security will improve over the next 10 years for the 76 low- and middle-income countries examined by ERS.? The improvement is driven by expectations of falling food prices and rising incomes across most of these countries. The share of the total population within these 76 countries that is food insecure is projected to fall from 17 percent in 2016 to 6 percent in 2026. The report estimates per capita food consumption and evaluates that against a nutritional target of 2,100 calories per person per day to determine whether population groups should be considered food secure. At the regional level, the greatest improvement in food security between 2016 and 2026 is projected for Asia, where the share of population that is food insecure falls from 13.2 to 2.4 percent. The share of population that is food insecure in the Latin America and the Caribbean region is projected to fall from 14.6 percent in 2016 to 6.4 percent in 2026. Sub-Saharan Africa is the most food-insecure region in the world, and like the other regions, its food-security situation is projected to improve over the decade?but at a slower rate. The share of the region?s population that is food insecure is projected to fall from 29 to 15 percent. This chart is from the ERS report,?International Food Security Assessment: 2016-2026, released June 30.

U.S. milk production continues to grow

Thursday, September 1, 2016

Milk production in the United States continues to grow, with year-over-year output increasing each month over the past few years. U.S. average daily milk production in April was 1.2 percent higher than the same period last year, following year-over-year gains of 1.8 percent in March, 1.0 percent in February and 0.2 percent in January. The increases reflect a combination of herd expansion and increasing production per cow.? Despite relatively low farm milk prices in recent months, low feed prices and favorable weather conditions have contributed to growth in milk production. At the same time, as dairy farms have grown larger, many have developed economies of scale that enable them to maintain profitability and in some cases even expand production in the face of lower margins. This chart is from the Livestock, Dairy, and Poultry Outlook: May 2016.

The United States is the second largest supplier of beef to Japan

Thursday, September 1, 2016

With its large population and limited space for agricultural land, Japan has long been one of the world?s largest importers of food products, including beef. In 2014, Japan imported nearly $3.5 billion of beef and beef products, making it the third largest beef importer in the world. The primary suppliers of these imports are the United States and Australia, which together represented roughly 90 percent of Japan?s 2014 beef imports in terms of both quantity and value. Australia has the larger share, with 51.8 percent of the total quantity of beef and beef-offal prod?ucts imports and 46.8 percent of the value. The U.S. share of this market, at 38.2 percent of quantity and 43.6 percent of value in 2014, has steadily recovered since 2004-06, when Japan banned imports of most U.S. beef in response to the discovery of bovine spongiform encephalop?athy (BSE) in the United States. The Japan-Australia Economic Partnership Agreement (JAEPA), signed in 2014, significantly reduces tariffs on imports of Australian beef, potentially giving Australia a strong advantage in supplying this market. However, both Australia and the United States are a part of the recently concluded Trans-Pacific Partnership (TPP) agreements, which if ratified, could improve U.S. access to this valuable market and lead to higher exports of U.S. beef to Japan. This chart is from the January 2016 report, Tariff Reforms and the Competiveness of U.S. Beef in Japan.

Most Indian crop yields remain below the world average

Thursday, September 1, 2016

India?s large and diverse agricultural sector is growing more rapidly than it was a decade ago, but per hectare yields of most major crops remain low by world standards despite generally good quality soils; ample, if highly seasonal, rainfall; and the largest irrigated area in the world. Of India?s major crops, only wheat?which is 93 percent irrigated?has average yields near the world average. India?s small scale-farm holdings?the average farm is 1.15 hectares?are often cited as a reason for slow adoption of yield enhancing technology. Another possible factor is the relatively low level of public investment in agricultural research, extension, and market infrastructure.? However, private investment in Indian agriculture is now much larger than public investment and is credited with the development and adoption of Bt (Bacillus thuringiensis) cotton varieties and hybrid corn, the rapid growth of integrated poultry operations, and the still nascent development of modern food marketing and supply chains. USDA long-term projections for India suggest a continued gradual increase in major crop yields towards potential yields, but greater public and private investment could accelerate the rate of yield improvement. This chart is from the Amber Waves article "Food Policy and Productivity Key to India Outlook."

U.S. rice ending stocks could rise to the highest level in three decades

Thursday, September 1, 2016

U.S. ending stocks of rice for the 2016/17 (August-July) marketing year are projected at 50.9 million hundredweight (cwt), up 19 percent from a year earlier and the highest since 1986/87. The substantial buildup in stocks is the result of a large increase in 2016/17 production that exceeds the gains expected in domestic use and exports. U.S. rice production for the 2016/17 marketing year is expected to reach 231.0 million cwt, the highest since 2010/11 and third largest on record. The bumper crop?up 20 percent from a year earlier?is primarily due to a large increase in harvested area as well as a slightly higher expected yield. At 3.06 million acres, 2016/17 plantings are up 17 percent from a year earlier and the highest since 2010/11. The substantial area increase is largely due to a return of several hundred thousand acres in the South that were not planted last year due to adverse weather, a lack of economically viable alternatives at planting time in the southern States, and an end to water restrictions in the Texas Rice Belt. The rising level of rice stocks in the United States is in contrast to the tightening stock levels currently faced by several? of the world?s? largest exporters?primarily India, Thailand, and Pakistan. Global ending stocks, excluding China, are expected to be down 13 percent from a year earlier, the fourth consecutive year of decline and the lowest since 2004/05. This chart is from the Rice Outlook June 2016 report.

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