Overview

USDA Agricultural Projections for 2010-19, released in February 2010, provide longrun projections for the farm sector for the next 10 years. These annual projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices.

Important assumptions for the projections include:

* Prospects for the agricultural sector in the near term reflect continuing U.S. and global adjustments to the recession of 2008-09 and the subsequent economic recovery.
* A resumption of steady global economic growth will support increases in consumption, trade, and prices in the longer run.
* Additionally, longrun developments for global agriculture reflect continued demand for biofuels, particularly in the United States and the European Union.

Key results in the projections include:

* Prices for corn, oilseeds, and many other crops remain at historically high levels over the next decade.
* The livestock sector continues to make adjustments in the first several years of the projections in response to high grain and soybean meal prices in 2007 and 2008, followed by weak meat demand caused by the global economic recession. The result is lower production at higher prices, which improves net returns and provides economic incentives for moderate expansion in the sector later in the projection period.
* Sustained biofuel demand and strengthening global food demand after the global economic recession provide a major impetus for strengthening cash receipts and moderate gains in net farm income.
* Retail food prices in the United States are projected to rise faster than overall inflation in 2010 through 2012. For the last half of the projection period, U.S. consumer food prices are expected to rise less than the general inflation rate.

http://www.ers.usda.gov/Publications/OCE101/OCE101.pdf