94th COMMITTEE PRINT 1st Session 1976 U.S. AGRICULTURAL OUTLOOK Papers Presented at the National Agricultural Outlook PREPARED FOR THE COMMITTEE ON AGRICULTURE AND FORESTRY UNITED STATES SENATE DECEMBER 18, 1975 Printed for the use of the Committee on Agriculture and Forestry 61-587 O U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 1975 For sale by the Superintendent of Documents, U.S. Government Printing Office JAMES W. GILTMIER, Professional Staff Member WILLIAM A. TAGGART, Professional Staff Member THOMAS REESE SAYLOR, Economist STEPHEN E. STORCH, Assistant Counsel JAMES C. WEBSTER, Chief Clerk and Press Secretary REIDER J. WHITE, Research Assistant GRAIN INVESTIGATION STAFF PHILIP L. FRAAS, Special Counsel (II) FOREWORD The latest National Agricultural Outlook Conference was held in mid-November. This Conference is sponsored each year by the U.S. Department of Agriculture to provide the agricultural industry-from producers through consumers with the latest information on production, prices, input supplies and the demand situation. However, the Conference goes beyond this and projects the direction and magnitude of agricultural trends over the upcoming year. The Conference is of particular significance this year because of continuing uncertainty for agriculture and a virtual reversal in the trends for many commodities from last year. A year ago, agriculture was facing a low and declining position for stocks of grains and soybeans as the result of a host of weather setbacks, and continued strength in export demand. The resulting high feed costs and relatively low market prices of livestock was causing broad contraction in our livestock industry. Farm income was fairly strong but the strength was centered in the crop sector and, in fact, was uneven within that sector. This year our crop producers, on average, enjoyed one of the most favorable weather years in recent history. Record crop production has been achieved almost across the board. Stocks are being rebuilt and as a result prices have been slipping. Today, livestock producers are finding a more favorable cost-price relationship and expanded production seems certain. This means that the income situation has improved for the livestock sector, although some weakening has occurred for crops. The export situation during 1975 was very irregular. While agricultural exports were at a new high for the fiscal year ending June 30, 1975, shipping interruptions cast a serious shadow over the outlook for agricultural exports. Because of the increasing importance of exports to our producers this has cast uncertainty over all of agriculture. In addition to these changes in the marketplace, our farmers are producing on a crash basis without the benefit of stabilizing farm programs. The many changes of the past three years-especially cost increases have rendered the target price levels of the Agriculture and Consumer Protection Act of 1973 virtually inoperative. We must be aware that this could result in alternate years of surplus and scarcity. This would be disastrous for producers and consumers and the whole economy. Therefore we must be diligent in our considerations of the current situation and closely monitor the developments of the upcoming year. In the interest of providing the members of the Senate Committee on Agriculture and Forestry, the Senate, and the general public with timely and reputable information regarding the general outlook and |