BMI View: We have revised up our 2016/17 corn and soybean production forecasts due to exceptional weather during the growing season . Livestock will see some mild improvem ent in production growth owing to the poultry and beef sectors. Over the long term, the poultry sub-sector will remain the outperformer in the livestock complex and we see the strongest producti on growth potential for soybean among the grains complex. We believe grains production will generally stagnate due to a lower planted area on the back of lower prices. A possible election victory by Donald Trump presents moderate-to-strong downside risks to our production and consumption forecasts.
Beef production growth 2014/15 to 2019/20: 8.2% to 11.7mn tonnes. Production will improve over our forecast period due to heavier animal weights and as the sector's rebuilding phase is largely complete.
Poultry production growth to 2019/20: 9.3% to 23.3mn tonnes. The US is the world's second largest poultry exporter, behind Brazil. As such, increased global demand for poultry, particularly from emerging markets, is likely to serve as a powerful production incentive.
Corn production growth to 2019/20: 11% to 383.2mn tonnes. Corn production growth will slow over the next five years as opportunities to increase yields (such as through the adoption of genetically modified seeds) are waning. Most of the gains will be due to base effects.
Soybean production growth to 2019/20: 6% to 113mn tonnes. Soybean production will stagnate beyond the record harvest in 2016/17 as low prices will constrain growth in plantings while normalised weather conditions will reduce yields.
2016 real GDP growth: 1.5% y-o-y, down from 2.4% in 2015, expected to average 2% between 2016 and 2020.
|Agribusiness Market Value|
|BMI Market Value By Commodity (2012-2020)|
|e/f = BMI estimate/forecast. Source: FAO, BMI|
A Hillary Clinton victory over Republican challenger Donald Trump would be preferable for the sprawling US agriculture industry, even though such a victory largely preserves the status quo. A Trump victory would be problematic for the sector, especially in the areas of labour, trade, and future farm bills. A secondary concern would be the rollback of financial regulations, which could lead to increased grain price volatility.
Clinton victory more favourable to US agriculture sector despite representing status quo
Trump victory would damage US agriculture sector prospects through crackdown on illegal immigration and threats to re-negotiate US trade agreements
Fruits, tobacco and vegetables sub-sector especially vulnerable to Trump's proposals, grains and livestock processing would be less (but still) affected.
Clinton victory core view means no changes to price and fundamental forecasts; a Trump victory presents moderate-to-significant downside risks to US agricultural forecasts as well as our grain, milk, and sugar price forecasts.
Food package labelling will be a key issue in the US agribusiness sector over the coming quarters, particularly in the context of the World Health Organization's declaration that several red meat products are to some extent carcinogenic. More narrowly, we see downside risks to red meat consumption in the US over the coming years, especially if state governments attempt to restrict red meat consumption through taxes or marketing campaigns.
Growing US consumer awareness will help to drive domestic meat processers to continue examining and amending their production methods in the coming years. A reduction in the use of animal steroids and antibiotics may increase brand equity for these companies, but it may also increase operating costs in an industry that already has low margins and is likely to see slowing sales growth over the coming quarters.
The United States Agribusiness Report features BMI Research's market assessment and independent forecasts for production, consumption and trade across core agricultural commodities.
BMI's United States Agribusiness Report includes independent commodity price forecasting and analysis for key agricultural outputs, an overview of the agribusiness competitive landscape and a discussion of the downstream context of agricultural production in relation to country food consumption forecasts and composite food and beverage trade forecasts.
- Use BMI's independent industry forecasts to test other views - a key input for successful planning in dynamic agribusiness markets.
- Apply BMI's medium-term commodity price analysis to assist with budgetary planning and the identification of investment opportunities and potential risks.
- Assess the activities and market position of your competitors, partners and clients.
BMI Industry View
Summary of BMI’s key industry forecasts and views, highlighting recent changes and key risks to the industry outlook.
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the wider agricultural industry.
BMI Supply & Demand Forecasts
Divided into sections based on various diverse sectors in the agriculture market, the chapter provides insight into each market’s agricultural industry, centred on sector forecasts to end-2019 for the consumption, production and trade of key commodities.
- Consumption Forecasts: Accompanied by a discussion of the main drivers of consumption growth: macroeconomic factors, food processing trends, price movements and increasingly, demand from the non-food sector.
- Production Forecasts: Examine the trends influencing BMI’s production outlook: global demand, price increases, public and private sector investment and agricultural efficiency improvements.
- Trade Forecasts: Accompanied by a discussion of the factors influencing a country’s trade in agricultural goods, including domestic demand, global prices and government trade policies.
- BMI’s Forecasts: Accompanied by a risks-to-outlook assessment, which examines potential factors that could affect our existing forecast picture and the likelihood of their occurrence.
BMI’s Commodity Price Analysis
Fundamental and technical analysis of the short- and medium-term price outlook for eight agricultural commodities based on globally recognised benchmarks.
Analysis of headline food and drink forecasts, including total food consumption, per capita food consumption and total sector trade, which provide important downstream intelligence for primary agricultural producers.
Includes relevant articles from BMI’s daily analysis service. These can include: long-term projections on agricultural imports and exports; our perceptions of the impacts of economic slowdown on key companies and subsectors within the Agribusiness industry in a given country; our analysis of fertilizer production; as well as other relevant analysis of recent news and events.
The reports contain information on prominent companies operating in each market.
Key Commodities Covered By The Agribusiness Market
Reports Include: Grains, Dairy, Livestock, Rice, Sugar, Palm Oil, Edible Oils, Coffee, Cocoa, Cotton, Soybean
Please note – not all reports cover all commodities.
The Agribusiness reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.