At the recent Cornell Agribusiness Outlook Conference, Cornell Ag Economists Todd Schmit and Bill Tomek predicted a difficult year for livestock producers buying a lot of their feed grain supplies. That's because of the booming market prices for corn, wheat and soybeans.
Schmit and Tomek reported the same thing in American Agriculturist's 2011 Northeast Ag Outlook article, now hitting farm mailboxes. "Tight and possibly negative margins may occur as we move into the new year, particularly for farmers purchasing most of their feed inputs," they noted. Farmers growing their own feed inputs won't be squeezed quite as hard.
They expect strong year-over-year feed costs increases this coming spring. If livestock and milk prices fail to respond proportionally, production may be curtailed going into summer. that' eventually would lead to higher product prices during the second half of 2011.