Crop Outlook Positive After Cool, Wet Spring


Spokane, Wash. (July 11, 2011) – Weather has been a key concern this year for agricultural producers. Since most crops were delayed at least several weeks in planting, harvests will be later than usual. A slow economy continues to hinder the nursery and timber industries.

The following highlights depict the general health of select industries included in Northwest FCS Knowledge Center Market Snapshots, which are available at

Beef:  Cattle prices continue to spark optimism with cow/calf pairs selling from $1,600 to $2,000 in recent weeks. The price for a 550-pound steer has moderated from recent highs, but is still at record levels. Strong exports have helped offset flat domestic demand for beef. Year-to-date, beef shipments to Japan are up 81 percent from a year ago. Overall, producers are looking forward to another good year.

Wheat:  Northwest wheat producers have dealt with an unfamiliar challenge this spring — too much rain. Regardless of the area, producers cite hurdles surrounding planting, crop disease and a delayed harvest. These challenges are by expectations far above average yields and prices.

Dairy:  Northwest dairy producers’ progress varied in the first half of 2011. In Washington, improved and more stable milk prices supported most producers’ profits through June. Dairymen in Southern Idaho, however, faced lower milk prices and varying levels of profits or losses. Regardless of location, rising feed prices will continue to challenge Northwest dairy producers’ bottom lines.

Apples:  The outlook for the Northwest apple crop is cloudy. Current strength in the marketplace should carry over to the 2011/12 marketing year, but optimism is tempered by uncertainties around apple production. Fruit development will be closely monitored in the months ahead.

Hay:  Hay supplies in the Pacific Northwest are tight. The 2011 season began with low hay inventories, and the cool, wet spring significantly delayed the first cutting. Although the region is now moving toward the second cutting, hay yields and quality have been impacted by adverse weather. Strong demand for new crop hay is driving prices toward levels not seen since 2008.

Forest Products:  Log prices in the Pacific Northwest are declining following a six month run-up in prices. The log market has reached a point where lumber prices won’t support the mills’ operating costs, and pricing is less attractive to export buyers. Lumber prices remain low given weak housing starts and excess processing capacity.

Cherries:  A late harvest and large crop have challenged cherry growers. At 17.2 million 20-pound boxes, the cherry crop is forecast to be the second largest on record. This will be the first year where more cherries are available in August than in June.

Nursery/Greenhouse:  Abnormal weather conditions early this spring eliminated sales opportunities for most producers. June sales, though, were significantly higher than the prior year with improved weather conditions. This year is expected to produce stronger sales results than 2010, but producers still face a sluggish market and escalating costs that further compress margins.

Potatoes:  Potato crops throughout the Northwest are delayed, but in good condition. Weather and growing conditions across the next 90 days will determine final yields. Processors and the fresh market are competing for tight old crop potato supplies. Producers are benefitting. Northwest potato markets mirror national markets, where prices are strong. Given the late 2011 crop, processors may experience August supply gaps.

Sugar Beets:  Sugar beet crops look good with fewer acres replanted due to the wet spring. Industry analysts generally agree sugar prices will remain strong throughout the year, supported by tight supplies and growing demand.

Wine/Vineyard:  After two years of sluggish activity, domestic wine retail sales grew 7 percent in 2010. The U.S. surpassed France as the world’s largest wine-consuming nation in 2010. There is uncertainty around Washington’s 2011 vintages due to two freeze events last winter. Approximately 20 to 30 percent of Washington’s wine grape crop was damaged.

Knowledge Center quarterly Market Snapshots include information on 18 industries and periodic special reports. If you’d like to receive these updates on a regular basis, sign up to receive the e-newsletter version of Market Snapshots at Also available on the resource pages are other Knowledge Center tools, Land Value Survey and regular columns by Dr. Dave Kohl and Dr. Ed Seifried. Northwest FCS Knowledge Teams have been created for the major agricultural industries Northwest FCS serves and are comprised of experienced, front-line staff.

Northwest FCS, the Northwest’s largest agricultural lending cooperative, provides financing, related services and crop insurance to farmers, ranchers, agribusinesses, commercial fishermen, timber producers, and rural homeowners in Montana, Idaho, Oregon, Washington, and Alaska. For more information, go to

Source:  Northwest Farm Credit Services

Posted by Haylie Shipp


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