The Effect of the Drought on Food Prices and Availability Todd Davis Senior Economist Agricultural Outlook Forum 2013: Managing Risk in the 21 st Century.

Slides:



Advertisements
Similar presentations
Joseph W. Glauber Chief Economist, USDA USDA 89 th Agricultural Outlook Forum February 21,
Advertisements

1 Informa Economics 2007 Agriculture Policy Roundtable Commodity Market Update By Jim Sullivan Informa Economics 2007 Agriculture Policy Roundtable Commodity.
The Financial Condition of Idaho Agriculture: 2004 projections John Hammel, Dean Ben Eborn, Extension Educator Garth Taylor, Extension Economist.
An Overview of Wisconsin and US Agricultural Economy Bruce L. Jones Director, Renk Agribusiness Institute August 2013.
Price Outlook, 2015 and Beyond 2015 GREAT LAKES PROFESSIONAL CATTLE FEEDING AND MARKETING SHORTCOURSE East Lansing, MI Bowling Green, OH Wyoming, ON Jim.
Regional Issues and Program Committee September 30, 2003 Larry D. Jones, Agricultural Economics.
2013 Illinois Farm Economics Summit The Profitability of Illinois Agriculture: Managing in a Turbulent World Income, Financial Outlook, and Adjustments.
2014 Illinois Farm Economics Summit The Profitability of Illinois Agriculture: Back to the Future? 2015 Crop and Income Outlook: Conserve Cash Now Gary.
Commodity Forecasting in the U.S. Department of Agriculture Presentation for Vietnamese Officials February 2006 William Hahn Senior Economist, Market and.
2007 Montana Agricultural Outlook George Haynes Vincent Smith David Buschena Department of Agricultural Economic & Economics and MSU Extension.
Beef Cattle Situation and Outlook million tons.
North Carolina Agriculture Blake Brown, PhD Extension Economist & Hugh C. Kiger Professor Department of Agricultural and Resource Economics North Carolina.
Beef Cattle Situation and Outlook Dr. Curt Lacy and Dr. John McKissick Extension Livestock Economists.
Business innovation in agriculture, food and natural resources Ag Situation and Outlook By Bill Knudson.
October 14, 2014 University of Missouri Extension.
1 Cattle Outlook 2011 and Beyond Shane Ellis Extension Livestock Economist Iowa State University August 16, 2011.
November 2010 Steven D. Johnson Farm & Ag Business Management Specialist (515)
Department of Economics Where are we with today’s economics and crop insurance? Chad Hart Fall Agronomy In-Service.
APCA A Market Directed Inventory System (MDIS) National Farmers Union February 29, 2012 Daryll E. Ray and Harwood D. Schaffer Agricultural Policy Analysis.
Extension and Outreach/Department of Economics Global Ag Commodity Markets agri benchmark Cash Crop Conference Des Moines, Iowa August 2014 Chad Hart Associate.
Extension and Outreach/Department of Economics Crop Insurance 2013 National Agricultural Credit Conference San Diego, California Apr. 17, 2013 Chad Hart.
Corn and Wheat Market Overview and Outlook by Cory G. Walters Southern Regional Outlook Conference Agricultural Economics.
Drought 2012: Impact and Implications for Animal Agriculture
Biorenewable Policy Analysis Center for Agricultural and Rural Development
Associate Professor/Crop Marketing Specialist
Agricultural Market Outlook July 17, 2014
Associate Professor/Crop Markets Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Impact of Drought of 2012 on Crop Yields
Livestock & Crop Outlook
Associate Professor/Crop Marketing Specialist
Bumpy Ag Markets and How to Survive Them
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Crop Insurance in 2011 AgriGold Seeds Meeting Ames, Iowa July 22, 2011
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Markets Specialist
2019 Wisconsin Agricultural Outlook Forum
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Commodity Market Outlook
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Crop Pressures ISU ANR Extension Conference Ames, Iowa Mar. 23, 2011
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Market Outlook ISU Extension Swine In-Service Ames, Iowa Mar. 29, 2012
Associate Professor/Crop Marketing Specialist
The 2017/18 Crop Market Outlook: The Search for Higher Prices
Grain Price Forecasts and the Implications for Animal Agriculture
Associate Professor/Crop Marketing Specialist
2012 Crop Market Outlook Coleman Research Group Presentation
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Figure 2.2 A Trends in the number of farms, 1990 to 2007
Associate Professor/Crop Marketing Specialist
Corn and Ethanol Outlook
Crop & Feed Market Outlook
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Associate Professor/Crop Marketing Specialist
Presentation transcript:

The Effect of the Drought on Food Prices and Availability Todd Davis Senior Economist Agricultural Outlook Forum 2013: Managing Risk in the 21 st Century

Outline  Drought and Effect on Crop and Livestock Production  Farm Price Impact on Consumer Expenditures  Policies Providing a Farm Safety-Net

Ripped from the Headlines *** Why Iowa's drought is a global problem CNN Money.com – August 9, 2012 Severe Drought Seen as Driving Cost of Food Up NY Times.com – July 25, 2012 Historic drought to bring higher food prices, experts say Fox News.Com – July 17, 2012 *** The July WASDE was released on 7/11/12 and the August WASDE on 8/10/12

For Some States, 2013 could be the Third Consecutive Drought Year

Source: NOAA

* Wyoming and Nebraska facing worst drought in 117 years

Source: NOAA

Livestock Marketing Information Center Data Source: USDA-NASS

Livestock Marketing Information Center Data Source: USDA-NASS

Livestock Marketing Information Center Data Source: USDA-NASS

Livestock Marketing Information Center Data Source: USDA-NASS

Livestock Marketing Information Center Data Source: USDA-NASS

2013 Winter Wheat Seedings Source: USDA-NASS About million Acres seeded in states with 10 th Percentile or less (52% of Winter Wheat Seedings)

Corn, Soy and Wheat Production from (P) Source: USDA-NASS, USDA-ERS

Biological Lag of Rebuilding Herds / Flocks

How do Farm Prices Impact Consumers’ Food Expenditures?

Source: USDA: ERS

Since 1993, Farm & Agribusiness share of the food dollar has declined from $0.145 to $0.101 with an average of $0.124

Source: USDA: ERS % of Disposable Income Spent on Food

Source: USDA: ERS Per Capita Daily Food Expenditures (2005 Dollars) 1970: $6.54/day 2011: $10.22/day

Source: USDA: ERS % of Household Expenditures on Food Worldwide

Risk Management Tools to Help Farmers Continue to Produce

Example: Return over Variable Costs with RP Insurance for an Iowa Corn Farm Note: APH Yield = 180 bpa; Projected Price = $5.75; 85% Coverage Level Source: Iowa State University Extension Budgets for 2013 Variable Costs = $405/acre and Cash Rent = $276/acre

Policies Providing a Safety-Net Crop Insurance is the Foundation for a Farmer’s safety-net A new Farm Bill will provide policy certainty to producers, lenders, and other participants in the supply chain Given the drought maps, would you invest $681/acre in corn without the security provided by crop insurance?

Summary Farmer’s share of the food dollar is small and declining Drought impact on livestock sector is significant and often over-looked by media When U.S. returns to near-trend yields and stocks rebuild, poultry and pork have capacity to expand faster than beef Relatively more expensive beef than pork/chicken Loss of beef market-share

Thank You for Your Attention!