WASHINGTON – Crop receipts are anticipated to increase more than 19 percent in 2011 as large increases are expected across a number of crop categories, according to the US Department of Agriculture. Livestock receipts are expected to increase nearly 16 percent, led by strong sales of dairy, meat animals and turkeys. Many different crop and livestock categories are expected to achieve record-high sales.

Feed crop receipts are expected to increase almost 37 percent, achieving a record level in 2011. Sales of corn for grain, which are predicted to account for almost 86 percent of 2011 feed crop receipts, are expected to increase more than 38 percent in 2011. While the quantity of corn sold in 2011 is expected to decline less than 5 percent, this will be more than offset by an almost $2-per-bushel increase in price. Corn exports are suffering as rising US corn prices have made feed-quality wheat, a substitute, more competitive.

Tight US corn supplies, due largely to a drought in Southern-producing states, have hurt US corn exports. Price increases are also expected in 2011 for barley, oats and hay.

Large anticipated price increases in 2011 are expected to generate strong sales for US livestock. Large sales increases are anticipated for all three categories of meat animals, and to a lesser extent for turkeys. Cattle and calf cash receipts are anticipated to increase despite declining production in 2011, reflecting large price gains as global demand for US beef is expected to remain strong.

Hog cash receipts are expected to increase due to large price gains coupled with a small increase in pork production. Broiler cash receipts are expected to increase in 2011, with increases in production and strong broiler export demand. Egg cash receipts are expected to benefit from higher sales and price.

After increasing $18.9 billion (67 percent) from 2006 to 2008, feed expenses fell almost $2 billion in 2009 and were up less than 1 percent in 2010. In 2011, feed expenses are forecast to increase by $9.2 billion (20 percent). Two factors contributing to this forecast are a 17-percent increase in the feed prices-paid index and the 1-percent projected rise in livestock output. The rise in the feed prices-paid index is due to the forecast jump in feed grain and oilseed prices.

Livestock and poultry purchases are forecast to be up $2.4 billion (12.1 percent) in 2011. Since cattle account for 75 percent of this expense, conditions in the cattle market are the main driver of these purchases. Cattle-on-feed for 2011 is forecast to decline, but the cost of feeder cattle should be up over 16 percent because of abnormally tight inventories and high retail beef prices. High retail prices allow feedlot operators to earn favorable returns despite higher feeder cattle and feed costs.

According to ERS’ High Plains Cattle Feeding Simulator, the net margin in feedlots was positive between October 2010 and April 2011, the last month for which the simulator has calculated returns. With respect to other animals, pork production should be up 1 percent and prices for hog feeders will increase 17 percent. Broiler production is forecast down slightly while prices should be up a small amount.