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Agriculture's Realignment: Structural Transitions in Global Agriculture

Explore the shifting landscape of global agriculture and the impacts on farm income, crop returns, livestock prices, agribusiness, rural communities, ag lending, and future population growth and GDP trends. Gain insights on managing margins, adapting to market changes, and seizing international opportunities for agricultural success.

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Agriculture's Realignment: Structural Transitions in Global Agriculture

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  1. Agriculture’s Realignment “Structural Transitions in Global Agriculture” 2014 Agricultural Symposium Kansas City, Missouri July 16, 2014 Chad Hart Associate Professor/Crop Markets Specialist chart@iastate.edu 515-294-9911

  2. Iowa Crop Shifts Source: USDA-NASS

  3. Producer Adjustments Net farm income projected to decline significantly But remain above 10-year average Crop returns had led the charge as livestock struggled Now livestock prices are leading the industry

  4. Agribusiness Adjustments Agribusinesses have been caught in a margin squeeze High crop prices don’t necessarily translate to high agribusiness returns Managing margins by controlling supply chains, tailoring products and messages to customers, boosting supplies, and focusing on international markets

  5. Rural Community Adjustments Macke: “Rural communities either innovate or decline.” More reliance on non-ag enterprises Push back against trends: brain and wealth drain, homogenization, and competitiveness

  6. Ag Lending Adjustments More cautious approach Stronger combination of financial and risk management strategies Broader perspective on: Risks – policy, logistics, tax, trade, etc. Opportunities – international, expansion, etc.

  7. Population growth 2014 to 2050 Source: U.S. Census Bureau, International Data Base

  8. GDP Growth Source: USDA-ERS

  9. Liquid Fuel Usage Source: DOE-EIA

  10. Chinese economic growth: 1990

  11. Chinese economic growth: 2005 mcchronicles.blogspot.com photo AP photo Dongguan, Dec. 10, 2005: McDonald’s opens first drive-thru in China; half of the 100 restaurants plan to open each year will have drive-thrus

  12. Chinese economic growth: 2008 1000 more cars added to the streets of Beijing every day

  13. Chinese economic growth: 2011 Open 24 hours Delivery 24 hours More than 1,800 McDonald’s in China, with 200 more on the way

  14. NAFTA US agricultural trade with Canada Two-way trade up 376% since NAFTA Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

  15. NAFTA US agricultural trade with Mexico Two-way trade up 472% since NAFTA Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

  16. Land Values and Income Source: Mike Duffy, ISU

  17. Land Values and Income Source: Mike Duffy, ISU

  18. Arable Land

  19. Thank you for your time!Any questions?My web site:http://www.econ.iastate.edu/~chart/Iowa Farm Outlook:http://www.econ.iastate.edu/ifo/Ag Decision Maker:http://www.extension.iastate.edu/agdm/

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