crop outlook
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University Extension/Department of Economics
Crop Outlook
Farm Management In-ServiceAmes, Iowa
Oct. 11, 2010
Chad HartAssistant Professor/Grain Markets Specialist
chart@iastate.edu515-294-9911
University Extension/Department of Economics
U.S. Corn Supply and Use
Source: USDA
2007 2008 2009 2010
Area Planted (mil. acres) 93.5 86.0 86.5 88.3
Yield (bu./acre) 150.7 153.9 164.7 155.8
Production (mil. bu.) 13,038 12,092 13,110 12,664
Beg. Stocks (mil. bu.) 1,304 1,624 1,673 1,708
Imports (mil. bu.) 20 14 8 10
Total Supply (mil. bu.) 14,362 13,729 14,791 14,382
Feed & Residual (mil. bu.) 5,913 5,182 5,167 5,400
Ethanol (mil. bu.) 3,049 3,709 4,560 4,700
Food, Seed, & Other (mil. bu.) 1,338 1,316 1,370 1,380
Exports (mil. bu.) 2,437 1,849 1,987 2,000
Total Use (mil. bu.) 12,737 12,056 13,084 13,480
Ending Stocks (mil. bu.) 1,624 1,673 1,708 902
Season-Average Price ($/bu.) 4.20 4.06 3.55 5.00
University Extension/Department of EconomicsSource: USDA-NASS
University Extension/Department of EconomicsSource: USDA-NASS
University Extension/Department of EconomicsSource: USDA-NASS
University Extension/Department of Economics
Translates to a yield in the 170-175 bu. range
Translates to a yield around 160 bu.
Source: USDA-NASS
University Extension/Department of Economics
U.S. Soybean Supply and Use2007 2008 2009 2010
Area Planted (mil. acres) 64.7 75.7 77.5 77.7
Yield (bu./acre) 41.7 39.7 44.0 44.4
Production (mil. bu.) 2,677 2,967 3,359 3,408
Beg. Stocks (mil. bu.) 574 205 138 151
Imports (mil. bu.) 10 13 15 10
Total Supply (mil. bu.) 3,261 3,185 3,512 3,569
Crush (mil. bu.) 1,803 1,662 1,752 1,665
Seed & Residual (mil. bu.) 93 106 111 140
Exports (mil. bu.) 1,159 1,279 1,498 1,520
Total Use (mil. bu.) 3,056 3,047 3,361 3,305
Ending Stocks (mil. bu.) 205 138 151 265
Season-Average Price ($/bu.) 10.10 9.97 9.59 10.75
Source: USDA
University Extension/Department of EconomicsSource: USDA-NASS
University Extension/Department of EconomicsSource: USDA-NASS
University Extension/Department of EconomicsSource: USDA-NASS
Within a bushel of each other
University Extension/Department of Economics
World Corn Production
Source: USDA
University Extension/Department of Economics
Corn – Argentina & Brazil
Source: USDA
35
37
39
41
43
45M
illio
n a
cres
1800
2100
2400
2700
3000
3300
Mill
ion b
ush
els
Area Harvested Production
University Extension/Department of Economics
World Soybean Production
Source: USDA
University Extension/Department of Economics
Soybeans – Argentina & Brazil
Source: USDA
65
75
85
95
105M
illio
n a
cres
2700
3200
3700
4200
4700
Mill
ion b
ush
els
Area Harvested Production
University Extension/Department of Economics
La Niña Winter
Source: NOAA
University Extension/Department of Economics
Clearing Old Stocks
Source: USDA
1.5
2
2.5
3
3.5
4
4.5
Bill
ion
bush
els
The current stocks set-up is reminiscent of the transition between the 2006 and 2007 crops.
University Extension/Department of Economics
0
100
200
300
400
500
600
700
800
900
1,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Mill
ion b
ush
els
Corn Soybeans
Historical Export Levels
Source: USDA, FAS
Week 5 of marketing year
University Extension/Department of Economics
Corn Export Shifts
Source: USDA, FAS
Japan
Mexico
South Korea
Taiwan
Egypt
China
Unknown
Other
Total
-60
-40
-20
0
20
40
60
80
100
Mill
ion b
ush
els
39.4%
-11.5%
-40.7%
-21.3%
97.9%
71.5%
-14.7%
12.6%
University Extension/Department of Economics
Soy Export Shifts
Source: USDA, FAS
China
EUJapan
Mexico
Taiwan
Indonesia
Unknown
Other
Total
-20
-10
0
10
20
30
40
50
60
70
Mill
ion b
ush
els
6.1%
-82.1%-21.5%
42.9%
24.8%
-4.7%
58.6%
7.8%
252.1%
University Extension/Department of Economics
0
2
4
6
8
10
12
14
16
2010 2011 2012
Bill
ion
ga
llon
s
Conventional Biofuels Cellulosic Biofuels
Biodiesel Additional Advanced Biofuels
Renewable Fuels Standard (RFS)
CropYear
Billion Bushels
2009 4.11
2010 4.43
2011 4.64
2012 4.86
University Extension/Department of Economics
Ethanol Blending Advantage
-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
4/3
/20
07
7/3
/20
07
10/3
/20
07
1/3
/20
08
4/3
/20
08
7/3
/20
08
10/3
/20
08
1/3
/20
09
4/3
/20
09
7/3
/20
09
10/3
/20
09
1/3
/20
10
4/3
/20
10
7/3
/20
10
10/3
/20
10
$ p
er
gallo
n
University Extension/Department of Economics
Projected 2010 Season-Average Corn Price
3.00
3.50
4.00
4.50
5.00
5.50
6/8
/20
09
7/8
/20
09
8/8
/20
09
9/8
/20
09
10/8
/20
09
11/8
/20
09
12/8
/20
09
1/8
/20
10
2/8
/20
10
3/8
/20
10
4/8
/20
10
5/8
/20
10
6/8
/20
10
7/8
/20
10
8/8
/20
10
9/8
/20
10
10/8
/20
10
$ p
er
bush
el
Futures USDA
University Extension/Department of Economics
Projected 2010 Season-Average Soy Price
8.00
8.50
9.00
9.50
10.00
10.50
11.00
6/8
/20
09
7/8
/20
09
8/8
/20
09
9/8
/20
09
10/8
/20
09
11/8
/20
09
12/8
/20
09
1/8
/20
10
2/8
/20
10
3/8
/20
10
4/8
/20
10
5/8
/20
10
6/8
/20
10
7/8
/20
10
8/8
/20
10
9/8
/20
10
10/8
/20
10
$ p
er
bush
el
Futures USDA
University Extension/Department of Economics
Projected 2011 Season-Average Corn Price
3.50
3.75
4.00
4.25
4.50
4.75
5.00
12/1
4/2
00
9
1/1
4/2
010
2/1
4/2
010
3/1
4/2
010
4/1
4/2
010
5/1
4/2
010
6/1
4/2
010
7/1
4/2
010
8/1
4/2
010
9/1
4/2
010
$ p
er
bush
el
Futures USDA
University Extension/Department of Economics
Projected 2011 Season-Average Soy Price
8.50
9.00
9.50
10.00
10.50
11.00
12/1
4/2
00
9
1/1
4/2
010
2/1
4/2
010
3/1
4/2
010
4/1
4/2
010
5/1
4/2
010
6/1
4/2
010
7/1
4/2
010
8/1
4/2
010
9/1
4/2
010
$ p
er
bush
el
Futures USDA
University Extension/Department of Economics
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00$ p
er
Bush
el
Season-average Price Cost per Bushel
Iowa Corn Prices vs. CostsRight now, futures are in $5 range for 2010 and 2011 corn
University Extension/Department of Economics
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
11.00
$ p
er
Bu
shel
Season-average Price Cost per Bushel
Iowa Soybean Prices vs. CostsFutures are nearly $11 for 2010 and 2011 beans
University Extension/Department of Economics
3.40
3.60
3.80
4.00
4.20
4.40
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
$ p
er
bush
el
9.20
9.40
9.60
9.80
10.00
10.20
$ p
er
bush
el
Corn Soy
This YearCorn $4.70Soy $10.51
University Extension/Department of Economics
Thoughts for 2010 and BeyondGeneral economic conditions
Continued economic recovery is a major key for crop pricesLong-term oil price remain in the $90 range
Supply/demand concernsYield and production effects of Midwestern moisture and temperatureStocks: 2009 vs. 2010 cropSouth America: La Niña impactsBiofuels: E10, E12, or E15; Do the tax credits get extended/renewed?Will supply be able to keep pace with demand?
2010/11: USDA: Corn $5.00, Soy $10.75Futures: Corn $5.01, Soy $10.96
2011/12: Futures: Corn $4.93, Soy $10.88
University Extension/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/outreach/agriculture/periodicals/ifo/
Ag Decision Maker:http://www.extension.iastate.edu/agdm/
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