Farmers in California’s Central Valley, the world’s most productive agricultural region, will get none of the water they requested this year from a federally controlled system because of the drought gripping the state, the U.S. Interior Department’s Bureau of Reclamation said.
U.S. planting of eight major crops will decline 0.7 percent in 2014 to the fewest acres since 2010, and prices of corn, soybeans and wheat cotton will fall for the second straight year, the government said.
The U.S. corn crop may rise as farmers plant the most acres since World War II, easing pressure on higher food and fuel prices, the government said. Soybean planting may be little changed while wheat expands.
A decline in the value of the dollar will more than make up for slowing global growth this year, helping boost U.S. agriculture exports, said Joe Glauber, the chief economist for the Department of Agriculture.
Prices for the two biggest U.S. crops will fall this year on record corn and soybean production, easing food inflation while providing less cash for growers recovering from drought, the government said.
U.S. corn inventories probably won’t fall further because current levels are near the minimum necessary for users to keep products flowing, U.S. Department of Agriculture Chief Economist Joe Glauber said.
Conditions in the U.S., the biggest wheat exporter, are improving after snowstorms increased soil moisture following the worst drought since the 1930s Dust Bowl, according to the U.S. Department of Agriculture.
Farmers from Australia to Europe to the U.S. are poised to reap the second-largest wheat crop on record as fields recover from drought and heat waves, boosting global stockpiles for the first time in four years.