December 29, 2010

US grain prices to affect livestock producers

At the recent Cornell Agribusiness Outlook Conference, Cornell Ag Economists, Todd Schmit and Bill Tomek predicted a difficult year for livestock producers who purchase a lot of feed grain supplies.

This is because of the booming market prices for corn, wheat and soy.

"Tight and possibly negative margins may occur as we move into 2011, particularly for farmers who purchase most of their feed inputs," they added. Farmers growing their own feed inputs will not be affected as much.

They expect strong on-year feed costs increases this coming spring. If livestock and milk prices fail to respond proportionally, production may be curtailed into summer and this would eventually lead to higher product prices during the second half of 2011.