Economics of oilseed production

Abstract

United States production of oilseeds has increased 71% over the last 10 yr(1971–1981), from 42 to 72 mill tons. Soybeans have provided the big boost in output, accounting for 86% of the 30 mill ton gain, followed by sunflowers with 7%, cottonseed 7%, and peanuts 2%. Flaxseed and safflower output declined during the decade. Many factors contributed to the sharp boost in soybean output during this period. Because soybeans were competitively priced, market demand showed a steady growth and stocks remained relatively low. Soybeans provided favorable returns to growers and were widely used in rotations with other crops. Sunflower production skyrocketed since 1974 due to development of higher-yielding hybrid sunflower varieties and strong European demand for the seed. Costs of crop production in the United States have been continuing their relentless climb, spurred largely by rising fuel costs and more recently by high interest rates. Fertilizer and agricultural chemicals have also contributed to the increased costs. In the next decade, world demand for high protein meal and vegetable oils will continue to increase as population increases and use will expand in less developed countries. Much of these expanded oilseed requirements, particularly for soybeans and sunflower, will be provided by the United States.