USDA Agricultural Projections to 2016.  Office of the Chief Economist, World 
Agricultural Outlook Board, U.S. Department of Agriculture.  Prepared by the 
Interagency Agricultural Projections Committee.  Long-term Projections Report 
OCE-
2007-1.
Abstract
This report provides projections for the agricultural sector through 2016.  
Projections 
cover agricultural commodities, agricultural trade, and aggregate indicators of 
the sector, 
such as farm income and food prices.  The projections are based on specific 
assumptions 
regarding macroeconomic conditions, policy, weather, and international 
developments.  
The report assumes that there are no shocks due to abnormal weather, further 
outbreaks 
of plant or animal diseases, or other factors affecting global supply and 
demand.  The 
Farm Security and Rural Investment Act of 2002, the Energy Policy Act of 2005, 
and the 
Agricultural Reconciliation Act of 2005 are assumed to remain in effect through 
the 
projections period.  The projections are one representative scenario for the 
agricultural 
sector for the next decade.  As such, the report provides a point of departure 
for 
discussion of alternative farm sector outcomes that could result under different 
assumptions.  The projections in this report were prepared in October through 
December 
2006, reflecting a composite of model results and judgment-based analyses.  
Longrun developments for global agriculture reflect increased demand for 
biofuels, 
particularly in the United States and the European Union (EU).  U.S. 
agricultural 
projections reflect large increases in corn-based ethanol production, which 
affects 
production, use, and prices of farm commodities throughout the sector.  
Expansion of 
biodiesel use in the EU raises demand for vegetable oils in global markets.  
Additionally, 
steady domestic and international economic growth in the projections supports 
gains in 
consumption, trade, and prices.  Although export competition is projected to 
continue, 
global economic growth, particularly in developing countries, provides a 
foundation for 
gains in world trade and U.S. agricultural exports.  Combined with increases in 
domestic 
demand, particularly related to growth in ethanol production, the results are 
generally 
higher market prices and cash receipts.  Rising production expenses and lower 
government payments offset some of the gains in cash receipts and other sources 
of farm 
income, but overall net farm income remains strong through the projections.  On 
average, 
consumer food prices are projected to rise more slowly than the general rate of 
inflation 
over the next decade, although increases in meat prices push food prices up 
faster in some 
years.
Keywords: Projections, crops, livestock, ethanol, trade, farm income, food 
prices.

February 2007