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 3,335 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 slaughterhouses, 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.
Volatile Commodity Prices
The pandemic and war in Ukraine prompted major supply disruptions resulting in a sharp rise in volatility of commodity prices including wheat and oilseeds.
Trade Restrictions Limit Markets
Trade restrictions on exports limit market access and make exports more expensive for foreign customers.
Industry size & Structure
Industry Forecast
Farm Raw Product Wholesalers Industry Growth
Recent Developments
Jul 23, 2024 - Prices and Employment Falling
- Producer prices for farm raw products wholesalers fell 7.5% in May compared to a year ago, according to the latest US Bureau of Labor Statistics data. The decline in industry producer prices followed a double-digit year-over-year sales decline in March. Meanwhile, employment by the industry grew 1.7% in May year over year and is more than 8% lower than eight years ago, BLS data show. Wholesale prices for farm raw products have tumbled from their highs in 2022 when Russia’s invasion of Ukraine drove up prices for grains, oilseeds, and other commodity products.
- Extreme weather events across the US are taking a toll on corn and soybeans, the nation’s two largest crops, according to the USDA’s June 17 Crop Progress report. The amount of corn currently in good or excellent condition is 72% (down from 74% the prior week), while the crop in poor or fair condition is 27% (up from 25%). Soybeans saw a similar trend, with 70% in good or excellent condition (down from 72% last week) and 29% in poor or fair condition (up from 27%). Serious flooding in South Dakota and Minnesota is impacting farms in both states, with high temperatures forecast for the peak growing season. Elsewhere, massive hail storms have damaged crops in Nebraska. Moreover, many meteorologists predict more challenges will arise as extreme heat sets in across the country. In June, the USDA released its updated Climate Adaptation Plan to promote climate resilience in agricultural production.
- The Biden administration in May announced new standards for sustainable aviation fuel (SAF), FarmProgress reports. The Treasury Department and Internal Revenue Service issued new guidelines for tax credits for SAF meant to spur production of SAF that reduce greenhouse gas emissions by at least 50% compared to petroleum-based jet fuel. Agriculture Secretary Tom Vilsack called the new guidelines for tax credits an “important steppingstone” that acknowledges the role farmers can play in lowering greenhouse gas emissions. The USDA also announced a pilot program to encourage farmers to “bundle” climate-smart agriculture practices for SAF feedstock. Corn-based ethanol producers can earn a tax credit if they incorporate multiple practices, such as no-till farming, cover crops, and enhanced efficiency fertilizer. Soybean SAF producers can also earn the tax break if they practice no-till farming and cover cropping, per FarmProgress.
- The 2024 Economic Outlook for US Agriculture predicts a mixed bag for agricultural commodities this year, with major crops, including corn, soybeans, wheat, and cotton, facing challenging outlooks while prices for vegetables, calves, and cattle are expected to rise, according to ag financier AgAmerica. Lower demand for corn in the US and strong domestic production will drive down prices. Soybean plantings and prices are expected to fall this year, while wheat prices are forecasted to drop amid increased global supplies. Cotton prices also are expected to fall on rising supply. Rising consumer demand for vegetables, especially frozen, is driving increased production and prices are predicted to grow by 5%, per AgAmerica. High beef prices in 2023 due to dwindling herds are expected to carry over in 2024, even as production increases. Overall, lower prices for agricultural commodities are contributing to a decline in net farm income in 2024.
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