SPOKANE, Wash. — AgWest Farm Credit released its Monthly Market Update covering the state of major agricultural commodities in Alaska, Arizona, California, Idaho, Montana, Oregon and Washington. The update features unique insights into economic drivers impacting agriculture and forestry in the West.
AgWest’s outlook for major commodities is summarized below. Visit AgWestFC.com/industry-insights to view expanded analysis for each industry, monthly economic headlines, relevant data and trends and additional special reports.
Reports suggest a light almond 2024 crop with smaller-than-average nut sizes. Combined with depleting inventories, this should help balance supply and demand and bolster prices over the next year. The 2024 pistachio crop will come in notably smaller than last season and while this may support prices, the loss in volume may impact producer profitability.
A smaller 2024 crop should support prices by early 2025, improving producer margins, and the organic sector continues to see strong demand and growth. Harvest is underway, and prices strengthened across most varieties except for Galas due to increased supply. Honeycrisp supply is down significantly, with growers reporting issues with bitter pit.
Producers remain optimistic, with excellent fall sale prices and overall strong cattle market performance. Beef production decreases have been smaller than projected due to heavier carcass weights, largely driven by a reduction in cattle numbers and decreasing feed prices.
Dairy prices have remained strong, partly due to constrained production, and producers are optimistic about profitability for the remainder of 2024. This is supported by decreasing feed costs and interest rate cuts, helping to reduce operating expenses.
Lumber prices remained flat in September, with interest rate cuts unlikely to have a material impact on prices and profitability until 2025. There are indications that the balance of supply and demand may improve with falling Canadian imports and production curtailments in the southern U.S. Log prices are flat to down, with some operators reducing harvest levels to better align with demand. Inventory levels are coming down and exports have softened from 2023 levels.
Western hay producers continue to struggle, with export demand remaining slow and anticipated price improvements yet to materialize. Dairies remain hesitant to purchase hay, however demand for feed-quality hay may increase in the coming months. International buyers are also cutting costs as global dairy prices remain challenging, leading to price discounting and slowing sales.
Naval and mandarin crop sizes continue to increase, and most expect the larger supply to meet strong markets. Juice prices are strong, particularly for organic Valencias. Lemon markets remain oversupplied due to excess production and rising imports.
Harvest is underway with good yields and high-quality crops, but the large 2023 crop carryover has impacted margins and open-market prices. Contracted acres for the 2025 crop are expected to decrease due to 2024 oversupply, and there are limited profitable crop alternatives for growers.
Wheat producers are navigating a complex landscape of strong yields and depressed prices from high carryover and elevated input costs. Despite record yields in some areas, many producers are at or near breakeven levels and anticipate needing insurance payments to help cover their costs.
Supply continues to exceed demand across the West, and prices for uncontracted wine grapes have fallen significantly. Crop sizes in Washington and Oregon appear average to above average, while in California, yields are reportedly down 10-40% depending on the location.
About AgWest Farm Credit
AgWest is a financial cooperative with approximately $32 billion in total assets that provides financing, crop insurance and related services to farmers, ranchers, agribusinesses, commercial fishermen, timber producers and rural homeowners primarily in seven Western states. AgWest is part of the 108-year-old Farm Credit System – the leading provider of credit to American agriculture. For more information, visit AgWestFC.com.
— AgWest Farm Credit
