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2014 OUTLOOK. Ray Grabanski Progressive Ag Fargo, ND Trading futures and options involves risk. Past performance is not indicative of future results. North Dakota Marketing Year Average Price. 2013 – IN REVIEW. 2013 – IN REVIEW. 2013 – IN REVIEW. - PowerPoint PPT Presentation
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2014 OUTLOOK
Ray Grabanski
Progressive AgFargo, ND
Trading futures and options involves risk. Past performance is not indicative of future results.
North Dakota Marketing Year Average Price
YearSpring Wheat Soyeans Corn
1971-2006 1.30 - 4.71 2.87 - 7.37 1.00 - 3.162007 7.45 9.63 4.062008 7.19 9.71 3.742009 4.90 9.26 3.182010 6.78 10.90 5.012011 8.17 11.90 5.812012 8.19 14.00 6.46
2013 – IN REVIEWJan-13 Dec-13 Change
Chi Wht H 7.7800 6.0500 -22.2%Chi Wht N 7.9400 6.1700 -22.3%
KC Wht H 8.3100 6.4000 -23.0%KC Wht N 8.2700 6.4300 -22.2%
Mpls Wht H 8.6500 6.3500 -26.6%Mpls Wht U 8.9500 6.6600 -25.6%
2013 – IN REVIEWJan-13 Dec-13 Change
Corn H 6.9800 4.2200 -39.5%Corn Z 5.8600 4.5000 -23.2%
Soybean H 14.1900 13.1200 -7.5%Soybean X 13.0300 11.3500 -12.9%
Soybean Oil
H 49.16 38.82 -21.0%
Soybean Meal H 420.60 437.70 4.1%
2013 – IN REVIEWJan-13 Dec-13 Change
Live Cattle G 129.900 134.500 3.5%
Feeder Cattle F 151.400 166.700 10.1%
Lean Hog G 85.720 85.420 -0.3%
2013 – IN REVIEWJan-13 Dec-13 Change
GOLD G 1677.10 1201.90 -28.3%
Silver H 30.38 19.34 -36.3%
Copper G 3.64 3.44 -5.5%
Platinum F 1538.70 1371.10 -10.9%
Palladium H 717.40 702.65 -2.1%
2013 – IN REVIEWJan-13 Dec-13 Change
Crude Oil G 91.79 98.42 7.2%
RBOB G 2.81 2.79 -0.9%
Heating Oil G 3.05 3.08 1.1%
Ethanol G 2.19 1.91 -12.7%
Natural Gas G 3.37 4.23 25.6%
2013 – IN REVIEWJan-13 Dec-13 Change
Dow Jones H 13070.00 16494.00 26.2%
S&P 500 H 1422.50 1841.10 29.4%
Nasdaq H 2652.00 3584.00 35.1%
Dollar 79.88 80.32 0.6%
CRB Index 313.37 277.68 -11.4%
Stocks Breakout to New Highs
10 year Monthly DJIA
CORN
Corn’s IssuesBigger than expected crop (158.8 bu)Demand
Exports started poor/cancellation/improvingEthanol pace slowing
EPA changing RFS
1.6 Million less Soft Red Acres
Corn Exports To DateSales Shipments USDA
2012 .538 0.312 .731
2013 1.32
60.0/week1.8/3.12 BB
0.574
26.1/week783/1.357
1.6
22 weeks into corn’s marketing year, 30 weeks to goSales need to average 9.3/Shipments 34.2
Corn Category 09/10 10/11 11/12 12/13 13/14 14/15Supply Beginning Stocks 1,673 1,708 1,128 989 821 1,481 Production 13,092 12,447 12,360 10,780 13,925 13,871 Imports 8 28 29 162 35 15 Total Supply 14,774 14,182 13,517 11,932 14,781 15,367Use Food, Seed, Ind. 1,370 1,407 1,428 1,396 1,400 1,425 Ethanol 4,591 5,019 5,000 4,648 5,000 4,600 Feed and Residual 5,125 4,795 4,557 4,335 5,300 5,000 Exports 1,980 1,834 1,543 731 1,600 1,750 Total Use 13,066 13,055 12,528 11,111 13,300 12,775 Ending Stocks 1,708 1,128 989 821 1,481 2,592
Stocks/Use Ratio 13.1 8.6 7.9 7.4 11.1 20.35 Year Average 11.2 Planted Acres 86.4 88.2 91.9 97.2 95.4 92.5Harvested Acres 79.5 81.4 84.0 87.4 87.7 85.1Yield Per Acre (Bu.) 164.7 152.8 147.2 123.4 158.8 163.0
Average Price 3.55 5.18 6.22 6.89 4.50 3.35
USDA 2014 L-R Projections
93.5 million acres, 86.1 hvstd. 165.6 bu/acre yield 14.26 billion bu crop Ethanol 4.9 billion bu. 2.6 billion carryout ($3.65) But reduce 400 mb since Nov. (2.2 B)
USDA 10 yr. projections
2014-2018: $3.30-$3.65 2019-2024: $3.75-$4.20
B/E now is $4.14 Target Price is now $3.70
Monthly corn: Consolidation?
Weekly Chart: Bottoming???
Mar 14 Corn: $4.45 sell July
Dec 14 Corn: $4.65/$5.35?
SAM Weather
SOYBEAN
Soybean IssuesSouth America:
Brazil: huge acres, 5 to 8% increase,early harvest good, getting hot
south Argentina: hot dry conditions/improving
US demand impressively strongCrush demand very strong
meal demand main reasonExports very strong but China has huge
Soybean Exports To Date
Sales Shipments USDA
2012 1.25 1.01 1.32
2013 1.58
71.8/week2.15/3.73 BB
1.16
52.7/week1.58/2.74 BB
1.51
22 weeks into corn’s marketing year, 30 weeks to goSales are over expectations/Shipments need 11.7
Soybean Export Destinations
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120.00
2.50
5.00
7.50
10.00
12.50
15.00
17.50
20.00
22.50
25.00
ChinaMexicoJapanTaiwanIndonesiaNetherlands
Soybeans Category 09/10 10/11 11/12 12/13 13/14 14/15 Supply Beginning Stocks 138 151 215 169 141 150 Production 3,359 3,329 3,094 3,034 3,289 3,484 Imports 15 14 16 36 30 15 Total Supply 3,512 3,495 3,325 3,239 3,459 3,649Use Crush 1,752 1,648 1,703 1,689 1,700 1,750 Exports 1,499 1,501 1,365 1,320 1,510 1,550 Seed and Feed 90 87 90 89 87 90 Residual 20 43 -2 1 12 25 Total Use 3,361 3,280 3,155 3,099 3,309 3,415
Ending Stocks 151 215 169 141 150 234
Stocks/Use Ratio 4.5 6.6 5.4 4.5 4.5 6.95 Year Average 5.2
Planted Acres 77.5 77.4 75.0 77.2 76.5 79.5Harvested Acres 76.4 76.6 73.8 76.2 75.9 78.3Yield Per Acre (Bu.) 44.0 43.5 41.9 39.8 43.3 44.5
Average Price 9.59 11.30 12.50 14.40 12.70 10.35
USDA Baseline 2014 no’s
78 million acres 45.2 bu/acre yield 3.480 billion bu crop
203 million bu carryout ($9.75)• But reduced 20 mb after Nov. (183)
USDA 10 yr. projections
2014-2021: $8.85 to $9.75 2022-2024: $9.95 - $10.15
Target price is $8.40
Soybean Monthly: Downside Risk?
Weekly: Consolidation???
Mar 14 Sbns: inverted, sell
Nov 14 Sbns: $11.65/$12.35
7 Yr. 6 Yr. 5 Yr. 4 Yr. 3 Yr. 2 Yr. 2012600
700
800
900
1000
1100
1200
Corn Revenue Rankings
Progressive AgAgResourcesAgrivisorAgrivisorBrockStewart-PetersonUtterbackDoaneRe
venu
e $/
Acre
7 Yr. 6 Yr. 5 Yr. 4 Yr. 3 Yr. 2 Yr. 2012400
450
500
550
600
650
700
Soy Revenue Rankings
Progressive AgAgResourcesAgrivisorBrockStewart-PetersonTop FarmerUtterbackDoane
Year of Rankings
$ Revenue Per Acre
Check Out Our Website
www.progressiveag.com
Daily Comments:User name: dailyPassword: heart
Weekly Comments:User name: weeklyPassword: superbowl
WHEAT
Wheat’s Issues - USUS Winter Wheat going into dormancy at
very good conditionExports started strong,
slowing due to strong dollarWinter Wheat crop high qualitySpring Wheat average quality, discountsOct/Nov/Dec Crop Production Report
BEARISH, not expected
Wheat’s Issues - USUS Winter Wheat Crop Condition Rating
KS: 63% G/E 58% 35% OK: 77% G/E 63% 36%TX: 32% G/E 38/35/37% 19%CO: 55% G/E
18 States: 62% G/ELast Year: 33% G/E
Winter Wheat Acres Down
State 2007 2008 2009 2010 2011 2012 2013 2014KS 10.40 9.60 9.30 8.60 8.80 9.40 9.50 8.80 -7%TX 6.20 5.80 6.40 5.40 5.30 5.70 6.20 6.20 0%OK 5.90 5.60 5.70 5.20 5.10 5.40 5.60 5.30 -5%
MT 2.24 2.60 2.55 2.00 2.25 2.30 2.00 2.50 25%CO 2.50 2.15 2.60 2.40 2.30 2.35 2.30 2.90 26%IL 1.00 1.20 0.85 0.35 0.80 0.66 0.88 0.74 -15%IN 0.42 0.58 0.47 0.30 0.43 0.35 0.47 0.43 -9%NE 2.05 1.75 1.70 1.50 1.52 1.38 1.47 1.50 2%OH 0.82 1.12 1.01 0.80 0.88 0.50 0.69 0.63 -9%
Total 45.01 46.31 43.31 37.10 40.65 41.20 43.10 41.90 -3%
WW Acres
2007 2008 2009 2010 2011 2012 2013 20140.000.501.001.502.002.503.003.504.004.505.005.506.006.507.007.508.008.509.009.50
10.0010.50
KansasTexasOklahomaMontanaColoradoIllinoisIndianaNebraskaOhio
Wheat Exports To Date
Sales Shipments USDA
2012 0.772 0.599 1.007
2013 0.981
28.0/week476 MB/1.46
0.811
23.2/week394 MB/1.21
1.175
35 weeks into marketing year, 17 weeks to goSales need average 11.4/Shipments 21.4
Wheat Category 09/10 10/11 11/12 12/13 13/14 14/15 Supply Beginning Stocks 657 976 862 743 718 558 Production 2,218 2,207 1,999 2,266 2,130 2,366 Imports 119 97 112 123 170 120 Total Supply 2,993 3,279 2,974 3,131 3,018 3,044Use Food 919 926 941 945 960 950 Seed 69 71 76 73 74 75 Feed and Residual 150 132 162 388 250 275 Exports 879 1,289 1,051 1,007 1,175 1,200 Total Use 2,018 2,417 2,231 2,414 2,459 2,500Ending Stocks Total Ending Stocks 976 862 743 718 558 544
Stocks/Use Ratio 48.4 35.7 33.3 29.7 22.7 21.810 Year Average 28.5 Planted Acres 59.2 53.6 54.4 55.7 56.2 57.5Harvested Acres 49.9 47.6 45.7 48.9 45.2 52.0Yield Per Acre (Bu.) 44.5 46.3 43.7 46.3 47.2 45.5
Average Price 4.87 5.70 7.24 7.77 6.80 6.50
2014 USDA Baseline no’s
57 million acres, 48.5 hvstd. 45.8 bu/acre 2.220 billion bu production
642 million bu carryout ($4.90)• Only 7 mb reduction since Nov. (635)
USDA 10 yr. projections
2014-2020: $4.30 - $4.90 2021-2024: $4.90-$5.35
Target Price is $5.50 in new farm bill
Mar Mpls: $6.95/$7.35 sell
Sept 14 Mpls: $7.00/$7.35