MetLife’s Quarterly Ag Newsletter recently released in February detailed findings from this winter on the country’s agricultural economy, annual and permanent crops, livestock and agribusiness markets.

MetLife’s analysis stated that “the U.S. began a recovery in 2017 with the first year-over-year increase in net farm income since 2013 and stabilization in the farmland market.” MetLife expects the recovery to continue in 2018, but the outlook “remains sensitive to trade disputes and a further buildup in inventories.”

The report detailed that land values showed signs of stabilization last year, despite continued low commodity prices and rising interest rates. “USDA data show that, adjusted for inflation, national cropland values in 2017 were below recent peaks, with the largest declines occurring in Kansas, Nebraska, South Dakota, Iowa, and North Dakota, respectively.” Metlife expects farmland values to continue declining this year. However, multiple surveys and agricultural land value indices point to a slowdown in the pace of declines.

For annual crops, the USDA projects greater profitability for corn and soybeans compared to wheat and cotton for 2018. And over the long-term, the report stated that the USDA projects farmers will favor soybeans over corn. “For the first time since 1983, soybean acres are expected to match corn acres in 2018 and surpass them thereafter.”

Permanent crops were reported to be getting better in Florida after a recent tax bill and new orange varieties gave hope of relief after damage from 2017’s natural disasters. Tree nuts also benefitted from strong global demand which MetLife expects to continue into this year.

The newsletter also detailed a 5% increase in red meat and poultry supplies compared to 2016. The increase was because of “A major tailwind for the livestock sector in 2017 was the low cost of feed…” Metlife predicts an additional 5% growth in exports for 2018.

To read the entire report, go to Ag Quarterly Newsletter – Winter 2018.