2012: strong year for most ag producers

The Pacific Northwest agricultural industry remains strong, according to Northwest Farm Credit Services.

Excellent yields and high prices are resulting in good profits for apple, wheat and sugar beet growers, while tight supplies are bolstering returns for cow-calf and hay producers, said Michael Stolp, vice president of market research and development for NFCS.

The weak housing market continues to inhibit recovery in forest products and nursery industries, but U.S. consumers continue to purchase more wine despite slow growth in the domestic economy.

The following highlights depict the general health of select industries.

Beef - Cattle markets stabilized at the end of 2012 following a turbulent third quarter. Key risks in the coming year include weather, corn prices, the health of export markets and recovery in the U.S. economy.

Hay - Hay producers in the Northwest benefited from strong hay prices in 2012. Export market growth helped to offset lower demand from dairies. Exports should continue to support hay prices, but the market outlook will be strongly influenced by overall supplies, the price of alternative feeds and dairy industry profitability in 2013.

Wheat - Strong yields and markets resulted in an outstanding year for most wheat producers. Looking ahead, lower global wheat supplies may boost domestic wheat prices during the 2012/13 marketing year, but so far the pace of U.S. exports is poor. Despite estimates that the U.S. winter wheat drop is in its worst condition in nearly three decades, ample U.S. wheat supplies and a projected increased in domestic wheat acres may pressure prices for the 2013-14 crop lower.

Apples - The Northwest produced a record shattering apple crop in 2012. The large crop is attributed to increased orchard productivity and excellent fall weather that extended harvest. Growers can expect profitable returns despite record production. An otherwise short Northern Hemisphere apple crop is driving strong markets, prices and sales.