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Crop Outlook for 2012. Ackley State Bank Ag Seminar Iowa Falls, Iowa Dec. 14, 2011 Chad Hart Assistant Professor/Grain Markets Specialist [email protected] 515-294-9911. U.S. Corn Supply and Use. Source: USDA-WAOB. U.S. Soybean Supply and Use. Source: USDA-WAOB. Projected Corn Yields. - PowerPoint PPT Presentation
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Extension and Outreach/Department of Economics
Crop Outlook for 2012
Ackley State Bank Ag SeminarIowa Falls, IowaDec. 14, 2011
Chad HartAssistant Professor/Grain Markets Specialist
Extension and Outreach/Department of Economics
U.S. Corn Supply and Use2008 2009 2010 2011
Area Planted (mil. acres) 86.0 86.4 88.2 91.9
Yield (bu./acre) 153.9 164.7 152.8 146.7
Production (mil. bu.) 12,092 13,092 12,447 12,310
Beg. Stocks (mil. bu.) 1,624 1,673 1,708 1,128
Imports (mil. bu.) 14 8 28 15
Total Supply (mil. bu.) 13,729 14,774 14,182 13,453
Feed & Residual (mil. bu.) 5,182 5,125 4,792 4,600
Ethanol (mil. bu.) 3,709 4,591 5,021 5,000
Food, Seed, & Other (mil. bu.) 1,316 1,370 1,407 1,405
Exports (mil. bu.) 1,849 1,980 1,835 1,600
Total Use (mil. bu.) 12,056 13,066 13,054 12,605
Ending Stocks (mil. bu.) 1,673 1,708 1,128 848
Season-Average Price ($/bu.) 4.06 3.55 5.18 6.40
Source: USDA-WAOB
Extension and Outreach/Department of Economics
U.S. Soybean Supply and Use2008 2009 2010 2011
Area Planted (mil. acres) 75.7 77.5 77.4 75.0
Yield (bu./acre) 39.7 44.0 43.5 41.3
Production (mil. bu.) 2,967 3,359 3,329 3,046
Beg. Stocks (mil. bu.) 205 138 151 215
Imports (mil. bu.) 13 15 14 15
Total Supply (mil. bu.) 3,185 3,512 3,495 3,275
Crush (mil. bu.) 1,662 1,752 1,648 1,625
Seed & Residual (mil. bu.) 106 110 130 120
Exports (mil. bu.) 1,279 1,499 1,501 1,300
Total Use (mil. bu.) 3,047 3,361 3,280 3,045
Ending Stocks (mil. bu.) 138 151 215 230
Season-Average Price ($/bu.) 9.97 9.59 11.30 11.70
Source: USDA-WAOB
Extension and Outreach/Department of Economics
Projected Corn Yields
Source: USDA-NASS
Extension and Outreach/Department of Economics
Projected Soybean Yields
Source: USDA-NASS
Extension and Outreach/Department of Economics
World Corn Production
Source: USDA-WAOB
Extension and Outreach/Department of Economics
World Soybean Production
Source: USDA-WAOB
Extension and Outreach/Department of Economics
Corn vs. Wheat
Source: CME Group, 12/13/2011
5.40
5.60
5.80
6.00
6.20
6.40
6.60
6.80
7.00
7.20$ p
er
bush
el
Corn Wheat
Extension and Outreach/Department of Economics
Hog Crush Margin
Source: Shane Ellis, ISU Extension
The Crush Margin is the return after the pig, corn and soybean meal costs.Carcass weight: 200 pounds Pig price: 50% of 5 mth out lean hog futuresCorn: 10 bushels per pig Soybean meal: 150 pounds per pig
Extension and Outreach/Department of Economics
Cattle Crush Margin
Source: Shane Ellis, ISU Extension
The Crush Margin is the return after the feeder steer and corn costs.Live weight: 1250 pounds Feeder weight: 750 pounds Corn: 50 bushels per head
Extension and Outreach/Department of Economics
Corn Export Shifts
Source: USDA-FAS
Japan
Mexico
Taiwan
Egypt
Unknown
OtherSouth Korea
Total
China
-60
-40
-20
0
20
40
60
80
100
Mill
ion b
ush
els
-18.6%
39.4%
-28.8%
-21.9%
-79.9%
2.7%
-17.7% -3.0%
746.4%
Extension and Outreach/Department of Economics
Soy Export Shifts
Source: USDA-FAS
China
EUJapan Mexico Taiwan
Total
Unknown
Indonesia
Other
-450
-400
-350
-300
-250
-200
-150
-100
-50
0
Mill
ion b
ush
els
-25.5%
-75.1% -17.4% -11.4% -42.0%
-72.5%
-43.0%
-34.0%
-27.2%
Extension and Outreach/Department of Economics
Change of Export Pace
-40%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
9/1 9/8 9/15 9/22 9/29 10/6 10/1310/2010/27 11/3 11/1011/1711/24 12/1
Corn Soy
Extension and Outreach/Department of Economics
5
7
9
11
13
15
17
2011 2012 2013
Bill
ion g
allo
ns
Conventional Biofuels Cellulosic Biofuels
Biodiesel Additional Advanced Biofuels
Renewable Fuels Standard (RFS)
CropYear
Billion Bushels
2011 4.64
2012 4.86
2013 5.07
2014 5.29
Extension and Outreach/Department of Economics
Corn Grind for Ethanol
Source: DOE-EIA
86
88
90
92
94
96
98
100
102
Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11
Mill
ion
bush
els
Extension and Outreach/Department of Economics
Ethanol Margins
Source: CARD
Extension and Outreach/Department of Economics
-0.04
-0.02
0.00
0.02
0.04
0.06
0.08
0.10
0.12
0.14
0.16
1/3
/20
07
7/3
/20
07
1/3
/20
08
7/3
/20
08
1/3
/20
09
7/3
/20
09
1/3
/20
10
7/3
/20
10
1/3
/20
11
7/3
/20
11
1/3
/20
12
7/3
/20
12
1/3
/20
13
7/3
/20
13
1/3
/20
14
7/3
/20
14
$ p
er
ga
llon
Ethanol Blending Advantage
Extension and Outreach/Department of Economics
Biodiesel Production
Source: DOE-EIA
0
10
20
30
40
50
60
70
80
90
Mill
ion
ga
llon
s
Extension and Outreach/Department of Economics
Biodiesel Margins
Source: CARD
Extension and Outreach/Department of Economics
Projected 2011 Season-Average Corn Price
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00
7.50
12/1
4/2
009
2/1
4/2
010
4/1
4/2
010
6/1
4/2
010
8/1
4/2
010
10/1
4/2
010
12/1
4/2
010
2/1
4/2
011
4/1
4/2
011
6/1
4/2
011
8/1
4/2
011
10/1
4/2
011
$ p
er
bush
el
Futures USDA
Extension and Outreach/Department of Economics
Projected 2011 Season-Average Soy Price
8.509.009.50
10.0010.5011.0011.5012.0012.5013.0013.5014.0014.50
12/1
4/2
009
2/1
4/2
010
4/1
4/2
010
6/1
4/2
010
8/1
4/2
010
10/1
4/2
010
12/1
4/2
010
2/1
4/2
011
4/1
4/2
011
6/1
4/2
011
8/1
4/2
011
10/1
4/2
011
$ p
er
bush
el
Futures USDA
Extension and Outreach/Department of Economics
Projected 2012 Season-Average Corn Price
4.50
5.00
5.50
6.00
6.50
7.00
12/1
4/2
010
1/1
4/2
011
2/1
4/2
011
3/1
4/2
011
4/1
4/2
011
5/1
4/2
011
6/1
4/2
011
7/1
4/2
011
8/1
4/2
011
9/1
4/2
011
10/1
4/2
011
11/1
4/2
011
$ p
er
bush
el
Futures USDA
Extension and Outreach/Department of Economics
Projected 2012 Season-Average Soy Price
10.50
11.00
11.50
12.00
12.50
13.00
13.50
14.00
$ p
er
bu
she
l
Futures USDA
Extension and Outreach/Department of Economics
Iowa Corn Prices vs. Costs
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00$ p
er
bush
el
Season-average Price Cost per Bushel
Extension and Outreach/Department of Economics
Iowa Soybean Prices vs. Costs
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
11.00
12.00
13.00
14.00
$ p
er
bush
el
Season-average Price Cost per Bushel
Extension and Outreach/Department of Economics
Principal Crop Area
Source: USDA-NASS
315
317
319
321
323
325
327
329
331
333
335
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
Mill
ion
acr
es
Extension and Outreach/Department of Economics
States with Room to Grow
Number is the difference in planted acres between 2008 and 2011
Extension and Outreach/Department of Economics
Iowa Crop Margins
-50
0
50
100
150
200
250
300
350
400
$ p
er
acr
e
Corn Soy
Extension and Outreach/Department of Economics
Extension and Outreach/Department of Economics
Thoughts for 2012 and BeyondGeneral economic conditions
Continued worldwide economic recovery is a major key for crop pricesUS job recovery, European financial concerns
Supply/demand concernsSmaller than anticipated U.S. crops, worries about dry conditionsBiofuel growth and energy demandCorn has the upper hand in the acreage competitionWill supply be able to keep pace with demand?
2011/12: USDA: Corn $6.40; Soy $11.70Futures (as of 12/13/11): Corn $5.74; Soy $11.14
2012/13:Futures (as of 12/13/11): Corn $5.39; Soy $11.05
Extension and Outreach/Department of Economics
Thank you for your time!
Any questions?
My web site:http://www.econ.iastate.edu/~chart/
Iowa Farm Outlook:http://www.econ.iastate.edu/ifo/
Ag Decision Maker:http://www.extension.iastate.edu/agdm/