Washington, Aug 18 - U.S. hog and dairy prices are forecast to rise in 2010 from their current money-losing levels but the outlook depends in part on an overall economic recovery, a University of Missouri think tank said on Tuesday.
In a mid-year update, the Food and Agricultural Policy Research Institute lowered its forecasts for farm-gate prices for corn and wheat from estimates made in a March "baseline" report.
"The U.S. livestock and dairy sectors have experienced lower meat and dairy prices during 2009 that have left these sectors in a bleak financial situation," said FAPRI. "This outlook shows 2010 price recovery but is dependent on general economic recovery and continued supply-side reductions.
"For most major U.S. crops, market prices have declined from last year's peaks but remain well above pre-2007 levels."
FAPRI estimated an average all-milk price of $12.47 per 100 lbs of milk for 2009, roughly two-thirds of the 2008 average and well below its March forecast of $13.08 per 100 lbs.
For 2010, FAPRI pegged the all-milk price at $15.16 per 100 lbs, up 90 cents from its earlier estimate. The think tank said its dairy figures reflected a recent increase in dairy supports by the Agriculture Department and a farmer-funded program to reduce the dairy herd.
Market hogs are forecast to average $42.82 per 100 lbs this year and $50.68 in 2010, said FAPRI. It said farrow-to-finish operators would lose $7.77 per 100 lbs this year but make $2.29 per 100 lbs next year.
Here are FAPRI estimates of average 2009/10 farm-gate prices for major row crops:
Crop ($/bu) March August
Corn 3.74 3.47
Wheat 5.30 5.04
Soybeans 8.76 9.44
Rice ($/cwt) 12.87 14.53
Upland cotton (cts/lb) 51.9 54.8