Northwest agriculture outlook a mixed bag
Producers of potatoes and wheat are expected to see profitable returns, according to the latest forecasts from Northwest Farm Credit Services.
The company, which describes itself as an $11 billion financial cooperative with customers in Washington, Montana, Idaho, Oregon and Alaska, provided the following highlights for Northwest agriculture on Oct. 3 – some of the company’s quarterly snapshot outlooks on commodities.
Grower returns will remain slightly profitable for uncontracted potatoes and profitable for contracted potatoes. Fresh market (uncontracted) potatoes may slip toward breakeven during harvest. Uncontracted prices will likely improve for the remainder of the marketing season depending on crop quality and packout.
Wheat producers should expect slightly profitable returns with above-average wheat production. Conversely, global supply is projected to decrease, favoring wheat prices. U.S. Department of Agriculture’s projections suggest the 2018-19 season-average farm price for all-wheat will be between $4.70 and $5.50 per bushel.
Alfalfa and timothy producers will likely be profitable. Fundamental supply conditions favor alfalfa hay prices and producer profitability across the West. However, uncertainty regarding trade looms.
The nursery/greenhouse industry should be profitable. Strong economic factors continue to boost consumer confidence and their willingness to pay more for plants. Sales and prices have increased.
Onion producers may see break-even returns. Favorable weather conditions allowed harvest to begin at least one week earlier than normal in many areas. Prices remain subdued for yellow onions due to lower-quality onions from California in the supply chain.
Apple growers should see slightly profitable returns. Good quality and shorter supplies should result in high packouts and good returns to growers. Tariffs are a headwind.
Northwest cherry growers should anticipate break-even to slightly profitable margins, depending on harvest timing. After last year’s record crop, the smaller supplies were welcomed by growers. Good quality and strong consumer demand resulted in optimism for strong returns. However, tariffs complicated export markets.
Producers should see slightly profitable returns throughout the beef industry as domestic and export demand continues to soften the impacts of growing beef supplies. However, record cattle on feed inventory is expected to pressure feeder cattle prices and feeder margins lower.
Northwest vineyards and wineries should capture profitable returns. Growing conditions were favorable this year, and large crops are expected. Wine sales growth is positive, although low compared to prior years. Some regions and varieties could be facing oversupply due to larger crops and lower wine sales.
By Post-Register Staff