2023 Ag Forecast Provides Updates for the Industry

Tifton, GA

Recently in Tifton, the University of Georgia held their annual Ag Forecast – a time where farmers, producers, and industry professionals discuss the fiscal outlook for the different sectors of the ag industry. This year, one speaker was William Chambers, Deputy Chairman of the World Agricultural Outlook Board, who says that things are looking up for the agricultural economy in 2023 as the Federal Reserve’s aggressive measures seems to have gotten inflation under control.

“In 2022 it was just highly volatile; with inflation and the federal reserve combating that inflation,” says Chambers. “Now the situation is different now, exactly where this lands, remains to be seen, people are definitely less pessimistic than they were even earlier in say the Fall. Inflation is still high, but it seems to be coming under control.”

However, Chambers says the outlook for some commodities, like cotton are a different story, as he says the price is down due to a decrease in global demand and even projects less acres being planted this Spring.

“We’re looking at a reduction in planted area for cotton, now we had some preliminary estimates back in the late Fall that had it down and we’re not the only ones that look at this; the different traders and commodity groups are looking at it. In fact, even here the UGA estimates are down year on year and that’s why. The prices are down. Global demand is down,” says Chambers.

Thankfully, there’s a different story for the state’s poultry industry, as Dennis Brothers, an Associate Extension Professor at Auburn University says that demand for poultry continues to increase both domestically and worldwide.

“The demand for poultry is high. Some of that’s based on the competitive meat prices, but looking forward, the poultry industry is going to continue to be a slow increaser in size and that proves good for the average consumer, because I think that will help keep poultry prices at a good place to buy chicken and it’s also good for the grower and the companies,” says Brothers.

However, according to Brothers, the poultry industry isn’t without challenges, as he says the biggest threat facing the poultry sector is the current outbreak of avian influenza, which has now affected almost sixty million commercial birds across the country.

“Probably the highest level of concern, probably goes around with high pathogenic avian influenza. It didn’t go away this year, it stayed around, it looks like it’s going to be around, it may be an endemic problem going forward. That’s a big concern for the poultry industry, both at the integrator level and at the grower level,” says Brothers.

According to Brothers, another concern for the industry is what it costs producers to expand their operations or for new producers to even get started in the industry.

“If a grower wants to build new housing or wants to get into the business, the cost of housing is extremely high levels right now, don’t know when that will come back down,” says Brothers. “Cost of lumber, cost of metal, even cost of land. Potential growers are having to compete with residential housing to buy land if they’re going to buy land to build houses, so it makes it very difficult for your average family farmer to get into the poultry business; a lot more difficult than it was, say ten years ago.”

By: John Holcomb