By Brad Haire
University of Georgia
Net farm income should keep rising throughout 2004 and the rest
of this decade, according to the 2004 Georgia Farm Outlook and
Planning Guide, compiled by the University of Georgia Department
of Agricultural and Applied Economics.
The demand for food and fiber at home and for U.S. farm exports
will continue to climb. And supplies are tighter now than in the
past.
All of that is good news for Georgia farmers, said Don Shurley,
the UGA Extension Service economist who edited the outlook.
Exports, exports
The economic health of major Georgia farm commodities like
cotton, peanuts and poultry and the future growth of other
commodities like vegetables depend greatly on how well they can
compete on world markets.
“Because we can grow so much of our crops, we generally have
more than we can consume in the United States,” Shurley
said. “We have to be able to successfully export our
commodities.”
The continued weakening of the U.S. dollar in international
trade markets will make U.S. farm goods easier for other
countries to buy in 2004.
“When the U.S. dollar weakens,” Shurley said, “farm prices
usually respond positively due to increased demand for U.S.
exports.”
High cotton?
Georgia cotton farmers had a great year in 2003. They had a lot
of cotton, and the world wanted it. Foreign mills demanded it to
make clothes. China, a U.S. cotton competitor, needed it because
they had a bad cotton year. And the weaker U.S. dollar helped
make it all a little more affordable.
These same positive price factors will continue into 2004. But
prices probably won’t be as good as in 2003, according to the
report.
When cotton prices are good in one year, farmers tend to plant
more cotton in the next. If they plant more and growing
conditions are good, U.S. and world production will likely be
high. This will increase the supply and reduce prices.
It’s tough to predict, but cotton prices in 2004 will probably
be around 60 cents per pound. They got as high as 84 cents in
2003.
Powerful peanuts
Georgia peanut farmers can expect better prices in 2004. When
prices for other commodities climb, that tends to increase
peanut prices, says Nathan Smith, a UGA Extension Service peanut
economist.
Peanut shellers hope to woo growers into planting peanuts
instead of other crops like cotton this spring. They’re
contracting peanuts right now for about $400 per ton, $20 higher
than 2003 prices.
Strong cattle
Despite one U.S. case of bovine spongiform encephalopathy, or
mad cow disease, in late 2003, Georgia’s cattle outlook is
good.
U.S. consumers are still demanding beef, and U.S. supplies are
relatively tight. This translates into favorable prices for
cattlemen, said Curt Lacy, a UGA Extension Service cattle
economist.
In 2003, a Georgia cattleman could get around 90 cents per pound
for a 500-pound steer. He can expect in 2004 to get around 85
cents per pound, still a strong price.
According to the outlook, per capita consumption of major
Georgia vegetables like bell pepper, tomatoes, sweet corn, onion
and cabbage increased by 3 percent to 5 percent in 2003. It’s
expected to increase slightly in 2004. Any increase in exports
due to the weaker U.S. dollar will help growers, too.
Details about these and other Georgia crops can be found in the
outlook guide in late January at www.agecon.uga.edu.
