Agricultural Outlook for 2023: Here’s What Industry Experts Are Saying
January 4, 2023 As I write this first column of 2023, I am wondering what kind of year it will be for the agricultural industry. At this point, it’s hard to say, primarily because of how well 2022 turned out.
At the start of 2022, there was plenty of worry about how agriculture would perform. In fact, the first month and a half of the year was spent with various market watchers pointing to then incredibly high fertilizer prices, warning that this would deter any meaningful industry growth.
“It’s an unprecedented year; a crazy year,” said Joe Dillier, Managing Director for Ameropa North America, at an early January 2022 trade show. “I’ve been in this business since 1989 and I’ve seen years where demand was pulling prices, like in the early 2000s, when natural gas prices connected to fertilizer prices, and I’ve seen years when costs were driving prices. But I’ve never seen a year like 2021, where EVERYTHING was mixed up, both on the demand and supply side!”
Yet, when the dust finally settled, 2022 turned out to be a banner year for the marketplace. According to government statistics, net U.S. grower income topped more than $160 billion and fertilizer sales among the nation’s top ag retailers hit $23.4 billion. Indeed, the total revenues for the CropLife 100 ag retailers increased almost $11 billion year-over-year to $46 billion.
With a successful 2022 behind the industry, the question becomes can 2023 possibly match these kinds of growth figures? As with many things in life, that depends, say industry insiders.
On the plus side, the crop mix seems to favor more fertilizer use. According to early projections, USDA is anticipating corn acres to match soybean acres at approximately 90 million acres apiece. This would represent a slight uptick for corn, basically flat for soybeans. This would seem to bode well for lots of crop nutrients to be applied in the nation’s row crop fields.
However, some companies are a bit more cautious in their outlook, pointing out that all the market positives in 2022 won’t be back for this year’s growing season. “Ag retailers really benefitted in 2022 from rising markets . . . and ag retailers were the biggest beneficiaries,” says George Secor, President/CEO at Sunrise Cooperative, Fremont, OH. “[But] 2023 is setting up to be very different and we find ourselves in a declining market.”
Loading ...Obviously, it’s a bit early for any concrete 2023 growing season predictions. But since the bar was set so high during 2022, anything less than spectacular could still seem like a disappointment.
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