Farm exports fall, taking crop prices with them

Last year, farm exports were thriving, helping American farmers achieve record profits. But with the recession affecting countries worldwide, global demand for farm produce is declining, and crop prices are going with it. "The 2008 wheat crop was almost a once-in-a-lifetime crop, where you had above-average yields and above-average prices," Kim Anderson, a grain economist at Oklahoma State University, told The New York Times. "And then you come into the 2009 crop with almost the exact opposite."

The U.S. Department of Agriculture "recently predicted that farm exports, which account for about 20 percent of the value of farm production, would fall this year to $96 billion, from $117 billion in 2008, roughly in line with the recent falloff of all American exports," Clifford Krauss write for the Times. "But the decline is particularly drastic for corn and wheat, two staples of the farm economy, and government economists say the falloff could directly lead to a loss of 45,000 jobs."

The lowered demand can be attributed to several factors, writes Krauss. Not only are countries less willing to pay for imports, thanks to the economic crisis, but the strengthening dollar also makes it less cost-effective to buy from the U.S. Homegrown crops are also on the rise for many of the traditional importers. (Read more)