On Your Markets, Get Set, G&O: US Long-Run G&O Prospects
Rabobank’s US long-term outlook for the three major crops – corn, soybeans, and wheat – identifies some structural changes and trends to watch.
- In 2021/22, US farm cash receipts are expected to increase, as grain & oilseed prices are projected to increase and remain well-supported.
- Total 2021 US area planted to corn, soybeans, and wheat is expected to expand by approximately 8m acres, or 3.6%, reaching a total of 226m acres.
- Due to strong prices and positive farm margins, US soybean and wheat area is expected to grow marginally from 2022 to 2025, while corn is expected to remain relatively flat. After 2025, area planted to the three major crops is expected to gradually decline toward 2030.
- US stocks are expected to remain tight, compared to the past five years. This is due to solid demand, particularly exports, assuming no trade restrictions and other disruptive policies.
- Higher prices will have implications along the entire grain & oilseed supply chain.
- Our outlook assumes a gradual global and domestic economic recovery in 2021 and beyond, reflecting the positive outcome of Covid-19 vaccines and other mitigation policies.