Farm Raw Product Wholesalers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 3,400 farm raw product wholesalers in the US purchase grain, crops and livestock from area farms, ranches and breeders, then aggregate the products or animals and sell in larger volumes to slaughter houses, grain mills, poultry farms, yarn and textile manufacturers (cotton, wool), food manufacturers, exporters, landscaping firms and builders (sod), biofuel producers and other manufacturers and wholesalers.

Trade Restrictions Limit Markets

Trade restrictions on exports limit market access and make exports more expensive for foreign customers.

Volatility in Commodity Prices

Raw farm product prices can change due to supply in the domestic or global market, shifts in consumer demand for products made with the commodity, and imports that gain or lose US market share.

Industry size & Structure

The average farm raw material product wholesaler employs about 20 workers and generates over $60 million in annual revenue.

    • There are 3,400 farm raw material product wholesalers in the US, operating 6,100 facilities, employing about 68,600 people, and generating annual revenue of $207 billion.
    • The industry is somewhat concentrated with the 20 largest firms controlling 56% of industry revenue.
    • Large grain wholesaling companies include Cargill, Scoular, Tronson Grain, and Pacificor.
    • Large livestock wholesaling companies include Smith Farms, East Carolina Stockyard, and South Texas Cattle Marketing.
                                    Industry Forecast
                                    Farm Raw Product Wholesalers Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Mar 23, 2023 - Storms Take Toll on California Crops
                                    • The relentless series of storms inundating California is having a dire impact on agricultural production in several areas of the state, AgNet West reported in March. Multiple atmospheric river events have hit the Watsonville and Salinas areas where a broken levee caused devastating flooding. The flooding has impacted the production of a variety of different crops. Strawberries, in particular, have taken a substantial hit, as the area accounts for approximately one-third of strawberry acreage in California, according to AgNet West. Estimates to date indicate that roughly one-fifth of strawberry farms in the area have been damaged by the series of storms. Other berry crops have been impacted along with leafy greens and vegetables. The crop losses threaten to limit supplies and raise grocery store prices.
                                    • Cotton production in the US is expected to rise to 15.8 million bales, despite lower planted area, according to the US Department of Agriculture’s first 2023/24 cotton crop projections. The anticipated rise in production is due to a 20% increase in harvested area, as abandonment is reduced dramatically from the record level seen in 2022/23 when drought and extreme heat took an unprecedented toll on production. Texas, which produces about 40% of the nation’s cotton crop, was especially hard hit. Domestic mill use is forecast to improve but remains at a relatively low level in 2023/24, with exports also projected higher at 13.8 million bales consistent with an average US share of global trade. The USDA’s 2023/24 projection for global cotton production anticipates that world consumption will slightly exceed production, lowering global stocks by 500,000 bales.
                                    • The Mexican government has shelved its January 2024 deadline for banning imports of biotech corn for animal feed and industrial uses, but is moving ahead with a ban on biotech corn for human consumption, the National Grain and Feed Association reports. “Regarding the use of genetically modified corn for animal feed and industrial use, the date for prohibiting its use has been eliminated,” Mexico’s Economy Department said, noting the decree “prohibits the use of genetically modified corn for dough and tortillas.” Mexico is the top destination for US corn exports, accounting for 27% of all US corn exports in marketing year 2021/22 in terms of volume, according to the USDA’s Economic Research Service. About 20% of the corn Mexico imports from the US is used for human food products. US officials and farmers criticized the partial ban on imports.
                                    • High prices for crops and increased Chinese demand for crop imports are expected to boost farmers, agricultural chemical suppliers, and grain traders, The Wall Street Journal reports. “We expect the market environment to be similar to 2022,” the CEO of agribusiness and food company Bunge Greg Heckman said on a recent analyst call, adding “That includes a globally tight crop supply, strong demand.” Farmers are expected to increase plantings this year to capitalize on high grain prices and offset higher input costs. Corn acres are expected to surpass 90 million, up about 2% from 2022, according to Farm Progress. US net farm income is projected at $137 billion this year, down 16% from 2022, when it hit its highest level in decades, according to a February report from the US Department of Agriculture.
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