USDA’s Top Predictions for 2024

Latest government report projects easing inflation, competitive job market and price moderation

12/28/2023

The USDA predicts a slight drop in beef production in 2024 and higher prices for cattle.

As the year closes, the U.S. Department of Agriculture (USDA) is out with its own predictions for the coming year, based on its data and experts’ insights. USDA shared a general macroeconomic outlook as well as projections for specific areas of agriculture.

The department’s latest report includes the following projections:

Inflation will continue to cool, with the Consumer Price Index (CPI) pegged at 2.9% in 2024, compared to 4.2% in 2023 and a high of 8% in 2022. The Producer Price Index (PPI) for finished goods is expected to remain steady, with a 1.5% rate in 2024 versus a 1.1% rate in 2023 and an elevated 13.4% in 2022. A leading economic health indicator – the Gross Domestic Product (GDP) – is projected to land at $27.77 trillion in 2024, while the GDP came in at $26.82 trillion in 2023 and $25.46 trillion in 2022.
On the labor front, USDA estimates that labor compensation per hour in nonfarm businesses will rise by 5.2%, the same pace as 2023 and above the 4.1% rate in 2022. The department foresees a higher civil unemployment rate of 4.5% for the coming year, above the 3.7% in 2023 and 3.6% in 2022. Taking a longer-term view, USDA anticipates wages to go up over the next 10 years as the unemployment rate remains generally low, signaling a competitive labor market during the decade.
As for crops, USDA’s report projects slightly lower planted and harvested acres for corn in 2024 versus 2023 but higher yields. Soybean production is expected to increase in the next year, as rice decreases. From a price perspective, USDA predicts that lower prices will impact the corn, soybean and wheat markets.
In animal agriculture, USDA sees beef production falling a bit in 2024, pork production remaining steady and young chicken and turkey production each inching up slightly. A year after high egg prices made headlines, egg production will also increase a bit, coming in higher than 2023 and 2023 numbers. USDA’s report shows that milk production will rise, as wholesale prices for butter, cheddar cheese and nonfat dry milk stay relatively stable.

Less volatility in commodities like grains and livestock in 2024, along with a lower overall CPI, will have a ripple effect through the supply chain. If not right away, these reduced prices will eventually reach the grocery sector that has experienced elevated inflation over the last few years.