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This report provides projections for the agricultural sector through 2018. 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 2008, reflecting a composite of model results and judgment-based analyses. Longrun developments for global agriculture reflect continued high crude oil prices as well as strong 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. As a result, overall net farm income remains strong and reaches record levels in the latter part of the projections. Higher energy-related costs and agricultural commodity prices push U.S. retail food prices up more than general inflation in the near term, but then food prices increase less than the general inflation rate over the remainder of the projections period.