Looking ahead to 2024: Experts look back on 2023 and release agricultural projections for the new year

This past year was a rocky one for agriculture. From record high prices to arguably more ag-related policy passed in a single year than ever before, it seems producers, business owners and other industry stakeholders were constantly defending their livelihood. 

2023 ag highlights

The beginning of the year saw some exciting advancements in technology when the world’s first agriculture-focused satellite, EOS SAT-1, was launched from Cape Canaveral, Fla. A few days later, the American Farm Bureau Federation and John Deere signed a memorandum of understanding ensuring farmers and ranchers had the right to repair their own farm equipment. 

January wasn’t as rosy for the poultry sector, which suffered a devastating hit from the worst breakout of highly pathogenic avian influenza the U.S. has ever seen. 

Since early 2022, U.S. producers lost more than 50 million laying hens, which was evident when grocery stores couldn’t get eggs on their shelves. 

According to the U.S. Bureau of Labor Statistics, this caused the average price of eggs to soar as high as 60 percent. 

April and May were a bit of a rollercoaster for the industry. 

On April 3, the Bureau of Land Management (BLM) published a proposed Public Lands Rule to establish conservation as an equal priority in its multiple-use doctrine, initiating a wave of controversy and dividing public lands users across the West. 

Also in April, the U.S. Department of Agriculture (USDA) launched their $3.1 billion climate smart initiative.

The month of May brought a few notable ag policy decisions. 

On the downside, California’s Proposition 12 was upheld by the U.S. Supreme Court. However, the industry saw a huge win when the court issued a favorable decision in Sackett vs. the Environmental Protection Agency (EPA) case, requiring the EPA to revise their definition of the ever controversial Waters of the U.S.

The BLM found itself in the spotlight again in August upon announcing the Rock Springs Resource Management Plan, which was not met with a favorable response from Sweetwater County or residents of Wyoming in general. 

Throughout the year, a tight cattle inventory resulted in continuous record-high beef prices, although beef exports slowed from their record highs in 2022. 

Pork exports were strong, increasing 5.7 percent year-over-year, according to USDA, although prices were lower on average than the previous year, and the sheep and lamb industry faced unprecedented challenges throughout the year, with prices in rapid decline. 

Looking forward to 2024

With another year of highs and lows in the rearview, many are looking forward to the new year, and experts have started to release their projections for what the ag industry will see in 2024. 

According to CoBank’s 2024 Year Ahead Report, released Dec. 14, the U.S. economy has remained steady despite “an unrelenting series of shocks over the last three years.” 

“Higher interest rates, a strong U.S. dollar and resiliency of the U.S. economy have weighed heavily on agricultural commodity prices,” states the report. “But, the bigger problem for farm margins heading into 2024 is the elevated cost of production.” 

“Global grain and oilseed stock inventories are tight by historic measures and the northern hemisphere will likely have a strong El Niño weather pattern during the growing season for the first time since 2015,” CoBank continues. “The dollar should continue its recent decline and global demand should return to its long-term growth trend.”

Animal protein and dairy 

Because beef cow numbers continue to fall, tightening supply and raising prices, USDA projects red meat consumption will be down nearly 1.8 percent in the coming year, with Americans consuming an average of 224 pounds of meat in 2024. 

CoBank notes this shrink in supply will cause packers to struggle through the new year. 

“However, profitability for the U.S. livestock sector should improve modestly in 2024, as lower feed costs and steadfast domestic demand offset weak global export conditions,” CoBank shares.

“Tighter cattle numbers, flat pork supplies and dampened broiler availability would normally be seen as supportive to margins, but all segments have been fighting rising costs of production,” CoBank continues. “With expansion plans on hold due to the high-cost environment, the industry’s focus on efficiency and technology is expected to intensify and risk management will remain paramount.”

According to USDA, steer prices in the leading five cattle states – Nebraska, Texas, South Dakota, Kansas and Oklahoma – will average $185 per hundredweight (cwt) in 2024, up from $177.30 in 2023. 

The department also projects the farm-gate price of hogs will climb by $1.75 per cwt, but prices for broiler chickens and eggs will fall. 

As far as trade goes, CoBank further notes U.S. animal protein will remain competitive in global markets but open access to markets is critical.

According to CoBank, although dairy demand faces some uncertainty, dairy product sales are expected to grow in 2024, led by sales of cheese, butter and yogurt. 

“However, this growth will be at a slightly slower pace, as U.S. consumers will be pressured by reduced household savings, growing credit card debt and higher interest rates,” CoBank says. 

“If global dairy demand picks up, the U.S. is poised to fill orders, as the other major dairy export regions all show signs of static milk production growth,” CoBank continues. “Lower feed costs and improved cow productivity should spur additional U.S. milk production.”

Grains, farm

supplies, biofuels

CoBank points out the renewable diesel boom and smaller U.S. soybean harvest of 2023 will drive an expansion of soybean acreage in 2024, reducing acres available for other crops.

USDA agrees, projecting an increase in soybean planting of 3.7 million acres and a reduction in corn and wheat planting of a combined five million acres in the new year.

“With normal weather and yields, the soybean crop could be the largest ever at 4.475 billion bushels,” USDA explains. “Upland cotton would expand by 1.6 million acres.” 

In its 10-year baseline projections, USDA forecasts crop prices in 2024 to average $4.50 per bushel for corn, $11.30 per bushel for soybeans and $6.30 per bushel for wheat. 

“The biofuel sector at large carries the momentum of historically large profit margins into the new year,” CoBank states. “Both ethanol producers and soybean crushers are benefiting from rising demand for biofuels.”

“The grain and oilseed price outlook hinges largely on the value of the U.S. dollar, conditions of wheat in Russia and harvests of corn and soybeans in South America,” adds CoBank.

Power and energy 

Additionally, CoBank’s report notes global conflict and political friction in the Middle East and Eastern Europe have created significant uncertainty in the power and energy sector. 

“Complicating matters further, global suppliers are reconciling the prospect of an accelerated energy transition with the realities of today’s fossil fuel-dependent economies,” CoBank shares. “Nevertheless, oil prices have fallen five percent in the fourth quarter as the economy slows and inventories rise. But, it is unlikely the current market calm will persist.” 

“The World Bank asserted if conflict-driven market disruptions escalate, oil prices could potentially blow past $150 per barrel in 2024,” the report concludes.

Hannah Bugas is the managing editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.