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Crop Insurance WorkshopGrand Island, NE
November 2, 2011
Columbus, NEUniversity of Nebraska-Lincoln 1995-1999
• Major - Diversified Agriculture • Minors – Agricultural Economics and AgronomyMinors Agricultural Economics and Agronomy
Johannes Farms 1999-2005
Cargill – Albion 2005-2009
Central Valley Ag 2009-present
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Regional Cooperative• Northeast Nebraska
500 Full-time EmployeesServices –Services
• Agronomy• Grain • Feed• Fuel
Full-service Grain Marketing Licensed Commodity BrokersServices
• Contract Alternatives• Contract Alternatives• Marketing Plans• Brokerage Services• Communication
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USDA Supply & Demand -Corn
October
Planted Acres 91.9
Harvested Acres 83.9
Yield 148.1
Beginning Stocks 1.128
Production 12.433
Total Supply 13.576Feed 4.700
Ethanol 5.000
Exports 1.600
Total Use 12.710
Ending Stocks 866Stocks-to-Use 6.81%
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1.5
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2.5
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US Corn Exports
0
0.5
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Corn – Food, Alcohol, Indust
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1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
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Ethanol is largest sector of DemandEthanol Demand > Feed Demand
5.00 bbu vs. 4.70 bbu
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Ethanol subsidies expire December 31st
• Blenders Credit - $.45/gallon• Tariff - $.54/gallon
Ethanol margins are excellent Ethanol margins are excellent Biofuel Mandate
• 15.2 billion gallons - 2012
• 36 billion gallons – 2022
Will it take us there?
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USDA Supply & Demand -Beans
October
Planted Acres 75.0
Harvested Acres 73.7
Yield 41.5
Beginning Stocks 215
Production 3.060
Total Supply 3.290Crush 1.635
Exports 1.375
Other 120
Total Use 3.130
Ending Stocks 160Stocks-to-Use 5.11%
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China raises ½ of all pork in the worldConsume nearly all domesticallyPork consumption
• Up 1 6x 1996 2010• Up 1.6x 1996-201051 MMT – 201171 MMT - 2020
US – 97% “industrialized” productionChina – 22%
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NOPA Crush
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1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
???
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Argentina
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Global economyUS DollarMiddle East
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Global economy
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“What happened to $7 corn???”
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January 1, 2001 – Joined the euroNovember 15, 2004 –
• Admitted to “fudging” the numbers to get into Eurozone
• Stability & Growth Pact>180% GDPCredit Rating = Junk
• 2-year bonds ~ 62%
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Bloomberg 9/13/11
98%
EU MUST:• Manage Greek default Balance write downs and perceived bankruptcy
• Plug the hole in the banks’ balance sheetsg• Reinforce “firewall” Spain and Portugal next?
N i l R bi i– Nouriel Roubini
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Formed 1850Co-founder NY Cotton Exchange – 1870Member of NYSE 18734th largest investment bank in US4th largest investment bank in USChapter 11 Bankruptcy
• September 15, 2008
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United States
Global Economy
Greece
The Other PIIGS
European Union
To add stability“Too Big to Fail”
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ProEdge Marketing
Know your numbers• Breakeven
Make decisions on profitability• $/Bushel is irrelevant $/Bushel is irrelevant
Diversify sales• No more “All or Nothing”
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If you run your farm like a business, 2012 will be another good year…
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Any Questions?Any Questions?y Qy Q
