Demand for Ag Products Running High

USDA is calling for a record corn crop of 10.932 billion bushels and the timing couldn’t be better.  Worldwide demand for corn and other grains has left storage bins practically empty.

“We have no major grain reserves anywhere in the world,” said J.B. Penn, under secretary for the Farm and Foreign Agricultural Service.  Penn was speaking to NCBA members on Aug. 12 at the Cattle Industry’s Summer Conference in Denver. “We’ve swept out the bins,” Penn said.  “We’re operating harvest to harvest.”

Penn said that export sales of agricultural products are forecast to hit a record $61.5 billion this year.  “The farm sector is in the strongest financial health it has ever been,” he said.

Penn said that over the last 50 years the trend has been for American farmers to increase production 2 percent a year.  That has led to a situation where the U.S. produces more than domestic consumers will purchase at an acceptable price. 

Keeping foreign markets open is important, as cattlemen have seen since the Dec. 23 case of BSE.  Opening new markets, such as China, offer real potential.  U.S. agricultural sales have grown from $1.8 billion since China joined the World Trade Organization in 2001, to $5.9 billion this year.  China is the fifth largest customer for U.S. ag exports.