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8 FEBRUARY 21, 2013 | WWW.PRODUCER.COM | THE WESTERN PRODUCERMARKETSUSDA | FORECASTCrystal ball shows good fortune for oilseedsMARKET WATCHD’ARCE McMILLANThe next 10 years should see continuedexceptional demand growthfor oilseeds, good growth in feedgrain demand and modest growth inwheat demand.All crop exporters have a shot atsupplying this growing demand, butComes out fighting.Brazil and the countries of the formerSoviet Union are expected to benefitthe most because of untapped landresources.The mature agricultural economiesof the United States and Canada havelimited expansion capacity. However,the U.S. will continue to do welland U.S. net farm income, while offthe highs of the last three years,should remain well above the averageof the 2001-10 period.These are the predictions of the U.S.Department of Agriculture, whicheach year at this time updates its 10year base line projections. The reportdoes not talk about Canadian farmincome, but it will likely follow a pathsimilar to the U.S.BayerCropScience.ca/Raxil or 1 888-283-6847 or contact your Bayer CropScience representative.Always read and follow label directions. Raxil ® is a registered trademark of the Bayer Group. Bayer CropScience is a member of CropLife Canada.The report is the lead-in to theUSDA’s annual outlook conferencethat takes place this week.The conference will have moredetailed outlooks for production anddemand, but the base line projectionreport by itself had immediateimpact because of its corn yield projectionfor this year.The USDA has adjusted the way itprojects corn yield by including theeffects of the droughts of the last fewdecades.It came up with a projection of163.5 bushels per acre, down from166 forecast in last year’s base line.However, that is more than privateforecasts such as Lanworth’s, whichhas an early view of 156.6 bu. per acre.Raxil ® MD is the winner and undisputed seedtreatment champion of wheat, barley and oats. Itsmicro-dispersion technology provides uniformand thorough seed coverage resulting in strongemergence, superior plant protection and anincreased return on your investment. Scorean easy victory over the most serious earlyseasoncereal diseases, including true loosesmut and both seed- and soil-borne fusarium,without the application struggle.For more information visit:BayerCropScience.ca/RaxilC-55-01/13-BCS13021-ELast year yield was 123.4 bu. andyields generally have been disappointingfor the past three years. Thisearly USDA forecast assumes averageweather in the U.S. this summer,but lingering drought makes productionprospects uncertain.Private forecasters such as DrewLerner expect normal moisture thissummer in the Midwest, but the U.S.National Oceanic and AtmosphericAdministration thinks an extensionof the drought is possible.Forecasts called for big snowstormsthis week in the central U.S.Looking at the longer term, theUSDA’s projections said global cropproduction in 2013-14 and beyondshould recover from the unusualcoincidence last year of drought inSouth America, the U.S. and theBlack Sea region. Crop prices shouldfall from the historically elevatedlevels of the past year but remain in ahigher plateau above the pre-2007levels.World per capita use of vegetableoil is projected to rise 17 percent inthe 10 years between 2013-14 and2022-23, compared with seven percentfor meat and eight percent fortotal coarse grain.The USDA said vegetable oildemand will rise faster than meal sothat should be good news for canola,which has a higher oil content thansoybeans.Rising incomes globally will continueto spur demand for meat andthe feed grain that is used to fattenlivestock.The rising standard of living causeswheat and rice per capita consumptionto fall one percent because peopledon’t eat more starch as they getwealthier. However, increasing populationdoes drive wheat trade higher.Global soybean trade is projectedto increase by 37 percent during thenext decade, while coarse grain traderises by 27 percent and wheat by 16percent.Corn’s dominance as a feed grainincreases, making gains against barley,sorghum and other feed. Chinastarts to become a significant cornimporter. In 10 years, it is importing19.6 million tonnes a year.U.S. wheat exports fall over theperiod and Canadian exports aresteady. Most of the gain in worldwheat trade goes to countries of theformer Soviet Union that also capturemuch of the increase in corn andbarley trade.Brazil continues to expand as aglobal agricultural powerhouse,exporting more soybeans and corn aswell as more poultry, beef and pork.The projections indicate that Canadianand U.S. livestock will reboundin the coming 10 years and thatexports of pork and beef will rise.Surprisingly, India becomes amajor beef exporter.Globally, per capita consumptiongrowth for poultry outpaces growthin pork or beef. However, the tradegrowth in beef is strong becausemore countries are able to meet theirpoultry and pork needs domestically.Beef trade rises 2.4 percent annuallywhile poultry grows two percentand pork 1.4 percent.The USDA emphasizes reality candiverge radically from its projectionsdepending on economic, policy andweather variables.Follow D’Arce McMillan on Twitter@darcemcmillan.