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USDA Report of Prices Received is No Surprise

USDA Report of Prices Received is No Surprise
USDA Monthly look at what farmers are getting from the market shows that prices continue to fall.

The prices farmers received - called the All Farm Products Index of Prices Received by Farmers in December - from USDA may not actually be news, but does show prices declined 2.2% from November. The Crop Index dropped 3.1% in the same period, while the livestock index slipped just 0.6%. The report was released Monday afternoon.

And the year-over-year numbers are harsher. The report shows that All Farm Products Index is down 9.5% from December 2012.

NO PILES OF MONEY: Prices are falling faster for crops sold than the cost of purchasing inputs and services.

Essentially prices farmers receive for all crops is sliding in year-over-year figures. For feedgrains, the price is down 35% from a year ago. The average price of corn slid to $4.31 per bushel, which is $2.56 per bushel lower than December 2012, the agency reports. The price of hay has slid to $168 per ton, down $21 from a year ago.

The news for soybeans is mixed. The latest report shows soybeans rose 30 cents from November, but is still $1.30 per bushel lower than December 2012.

On the livestock side, the news is a little better. The December index slid 0.6% from November, but is 13% above year-ago levels. However, prices for hogs and broilers are lower than last year. Hog prices - at $62.10/cwt. - are down $1.50 from November and 30 cents lower than a year ago. For beef cattle, the average price of $130/cwt. is unchanged from last month an $6 higher than a year ago.

For dairy producers, the December index rose 1.2% from a month ago, and is 5% higher than a year ago. The average price of a hundredweight of milk is $21.80.

The report also notes prices paid by farmers for commodities, services, interest, taxes and farm wage rates has slid about 1.8% from year-ago levels. At this time the income has fallen faster than the expense side of the ledger. As crop prices slide, farmers will be looking for cost-saving moves across the board.

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