1. Crop & Livestock Outlook
Farmers Coop Society Elite Member Meeting
Sioux City, Iowa
Dec. 9, 2015
Chad Hart
Associate Professor/Crop Markets Specialist 1 1

2. U.S. Corn Supply and Use 2012 2013 2014 2015 2015 Δ Area Planted
(mil. acres)
97.3
95.4
90.6
88.4
Yield
(bu./acre)
123.1
158.1
171.0
169.3
1.3
Production
(mil. bu.)
10,755
13,829
14,216
13,654 99
Beg. Stocks
989
821
1,232
1,731
Imports
160 36 32 30
Total Supply
11,904
14,686
15,479
15,415
Feed & Residual
4,315
5,040
5,315
5,300 25
Ethanol
4,641
5,124
5,209
5,175
-75
Food, Seed, & Other
1,397
1,369
1,359
1,380
Exports
730
1,920
1,864
1,800
-50
Total Use
11,083
13,454
13,748
13,655
-100
Ending Stocks
1,760
199
Season-Average Price
($/bu.)
6.89
4.46
3.70
3.65
-0.15
Source: USDA-WAOB 2 2

3. U.S. Soybean Supply and Use
2012
2013
2014
2015
2015 Δ
Area Planted
(mil. acres)
77.2
76.8
83.3
83.2
Yield
(bu./acre)
40.0
44.0
47.5
48.3
1.1
Production
(mil. bu.)
3,042
3,358
3,927
3,981 93
Beg. Stocks
169
141 92
191
Imports 41 72 33 30
Total Supply
3,252
3,570
4,052
4,203 94
Crush
1,689
1,734
1,873
1,890 10
Seed & Residual
105
107
145
133 3
Exports
1,317
1,638
1,843
1,715 40
Total Use
3,111
3,478
3,861
3,738 53
Ending Stocks
465
Season-Average Price
($/bu.)
14.40
13.00
10.10
8.90
-0.25
Source: USDA-WAOB 3 3

4. Corn Yield Estimate Top: 2015 Estimated Yields
Bottom: Change from last month
Units: Bushels/acre
Source: USDA-NASS

5. Soybean Yield Estimate
Top: 2015 Estimated Yields
Bottom: Change from last month
Units: Bushels/acre
Source: USDA-NASS

6. World Corn Production
Source: USDA-WAOB 6 6

7. World Soybean Production
Source: USDA-WAOB 7 7

8. U.S. Meat Production & Prices
Source: USDA-WAOB 8 8

9. Corn Export Sales
Source: USDA-FAS

10. Soybean Export Sales
Source: USDA-FAS

11. Strength of the U.S. Dollar
Source: Federal Reserve

12. Crude Oil Prices
Sources: EIA and CME

13. Corn Grind for Ethanol

14. Current Corn Futures
3.75
3.55
Source: CME Group, 12/7/2015

15. Current Soybean Futures
8.61
8.59
Source: CME Group, 12/7/2015

16. 2015/16 Crop Margins

17. 2016/17 Crop Margins

18. Iowa Corn Prices vs. Costs

19. Iowa Soybean Prices vs. Costs

20. Thoughts for 2016 and Beyond
Supply/demand concerns
Feed and ethanol markets have alternatives (sorghum, wheat)
Exports weaken as dollar strengthens and China slows
Will El Niño last through our next crop cycle?
Negative margins for crops
2014/15
USDA
2015/16
Futures
(12/7/15)
2016/17
Corn
$3.70
$3.65
$3.55
$3.75
Soybeans
$10.10
$8.90
$8.61
$8.59

21. Overarching Dairy Industry
Economic Outlook
Exports continue to be sluggish
World dairy prices putting downward pressure— Particularly on butter
Domestic consumption strong—Particularly full fat products (e.g., butter)
No sign of cut back in domestic milk production
First half of 2016 low farm milk prices
Can world production cut back enough for recover in second half of 2016?

23. This margin is calculated as the All Milk price minus a ration approximately comprised of 60lbs of corn, 15lbs of SBM and 27lbs of alfalfa hay. It is meant to support 100lbs of milk production and the associated proportion of dry cows, hospital animals and young stock in the herd.

24. Dairy Trends World milk production high in 2015
U.S. milk production up following profitable 2014
EU quotas ended
Stocks of dairy powders high
World import demand lower
Russian import ban
China working through stocks from 2014 purchases
Dairy prices very low in EU and NZ—not so much in U.S.

25. US Dairy Exports: Sluggish Year-To-Date Volume (Through July)
Commodity
Year-To-Date Volume (Through July)
Year-To-Date Volume
% Change
NDM/SMP
330,761
-6.2%
WMP
23,175
-35.7%
Cheese
200,561
-13.2%
Butter
14,698
-74.0%
Dry Whey
117,266
-18.0%
Lactose
210,900
6.6%
MPC
18,709
-47.0%
Aggregate Volume
1,109,762
-11.1%
Aggregate Value
3.28 billion
-27.7%

26. LMIC Milk Production and Price Quarterly Forecasts (12/7/15)
Sources: USDA/NASS; USDA/AMS Livestock Market News; Projections and Forecasts by LMIC
Year
Milk Cows
% Chg.
Prod. per Cow
Milk Prod.
Quarter
(1,000 hd)
Year Ago
(lbs)
(mil lbs)
2015 I
9,305
1.0
5,583
0.8
51,949
1.8 II
9,320
0.7
5,757
53,654
1.4
III
9,313
0.5
5,546
51,654
0.9 IV
0.2
5,500
51,178
0.4
9,311
0.6
22,386
208,435
1.2
2016
9,300
-0.1
5,600
0.3
52,080
9,285
-0.4
5,775
53,621
9,275
51,940
9,270
5,595
1.7
51,866
1.3
9,283
-0.3
22,570
209,507
2017
5,695
52,821
9,280
5,875
54,520
0.1
5,680
52,739
1.5
9,290
5,655
1.1
52,535
0.0
22,905
212,615

27. LMIC Milk Production and Price Quarterly Forecasts (12/7/15)
Sources: USDA/NASS; USDA/AMS Livestock Market News; Projections and Forecasts by LMIC
Year
Class III Price
% Chg.
All Milk Price
NCE/CME 40# Block Price
Quarter
($/cwt)
Year Ago
($/lb)
2015 I
15.73
-30.4
17.00
1.54 II
16.24
-28.6
16.70
1.64
III
16.14
-29.3
16.93
1.68 IV
-25.9
-27.4
2016
4.9
6.2
8.4
13.1
6.3
2017
10.0
6.1
5.7
0.0
5.8

28. Overarching Beef Industry
Economic Outlook
Supplies
Historically tight; but expansion well underway
Supply of heavy cattle; has driven market lately
Demand largely positive
U.S. demand has been GOOD – Will it continue?
Trade a bit of a drag but improving
U.S. dollar impacts but lower prices on the way?
Combined: Somewhat depends on…
Perspective
Sector of the industry

29. Quarterly Cattle & Beef Forecasts (LMIC: 12/7/2015)
Change
Average
Commercial
from
Dressed
Beef
Year
Slaughter
Year Ago
Weight
Production
Quarter
(1,000 hd)
(%)
(lbs)
(mil lbs)
2015 I
6,967
-5.5
813
2.2
5,664
-3.5 II
7,227
-7.8
810
2.7
5,855
-5.3
III
7,288
-4.5
832
2.8
6,066
-1.8 IV
7,283
-0.6
841
2.3
6,123
1.7
28,765
-4.7
824
2.5
23,708
-2.2
2016
7,140
822
1.1
5,868
3.6
7,405
0.4
6,020
7,623
4.6
836
6,370
5.0
7,519
3.2
839
-0.2
6,309
3.0
29,687
828
24,567
2017
7,446
4.3
827
0.7
6,161
7,720
816
6,299
7,815
6,559
7,857
4.5
842
6,616
4.9
30,838
3.9
831
0.5
25,635

30. Quarterly Cattle & Beef Forecasts (LMIC: 12/7/2015)
Live Sltr.
Change
Steer Price
from
Feeder Steer Price
Year
5-Mkt Avg
Year Ago
Southern Plains
Quarter
($/cwt)
(%)
7-800#
5-600#
2015 I
162.43
11.0
215.87
276.14 II
158.11
7.0
225.29
279.32
III
144.22
-9.0
214.38
246.04 IV
-20.0
-3.3
2016
-12.6
-7.7
-2.6
6.4
-4.3
2017
-0.4
-2.7
-1.8
-1.1
-2.1

31. Data Source: USDA & LMIC, Compiled by LMIC
Livestock Marketing Information Center

32. Data Source: USDA/AMS

33. Economic Outlook Overview:
Feedlots
2015 has been rough
Structural concerns still persist:
Excess capacity
Heifer retention, feeder cattle supplies outside feedlots
Supply of heavy cattle burdensome

34. Data Source: USDA-NASS
Livestock Marketing Information Center

35. Data Source: USDA-AMS & USDA-NASS
Livestock Marketing Information Center

36. Data Source: USDA-AMS & USDA-NASS
Livestock Marketing Information Center

37. U.S. Beef Exports, Jan-Oct 2015
(Volume excluding by-products & variety meats)
Oct-15/Sep-15
Oct-15/Oct-14
Year-to-Date
Country
Percent
1,000 lbs
Mexico
14%
13%
-72,469
-20%
Japan
-12%
-41%
-102,254
-18%
Canada
16%
-10%
-39,635
-13%
South Korea
24%
-11%
13,385 5%
Hong Kong
79%
-93,350
-28%
China (Taiwan)
20%
-16%
2,785 3%
Vietnam
65%
42%
2,871
43%
Netherlands
-1%
2,459 8%
Philippines
28%
-17%
2,510
10%
United Arab Emirates
87%
-3%
1,273
11%
Dominican Republic
40%
37%
3,022
Chile 6% 7%
-2,688
Italy
-40%
-582
-4%
Other Countries 2%
-6,337
-5%
Total
18%
-14%
-289,010
-13.4%
WASDE U.S.: 2014: 2,573 mil lbs 2015: 2,223 (-13.6%) 2016: 2,425 (+9.1%)
Source: USDA/ERS

38. U.S. Beef Imports, Jan-Oct 2015
(Volume excluding by-products & variety meats)
Oct-15/Sep-15
Oct-15/Oct-14
Year-to-Date
Country
Percent
1,000 lbs
Australia
-33%
292,365
34%
Canada
-6% 5%
33,975 7%
New Zealand
-17% 8%
91,299
17%
Brazil
-29%
20%
66,532
99%
Uruguay
13%
57%
43,388
Mexico 9%
76,725
30%
Nicaragua
53%
-42%
-13,396
-13%
Argentina
-100%
-186
Costa Rica
-14%
-22%
1,811
Other Countries
-8%
755
Total
-18%
593,269
25%
WASDE U.S.: 2014: 2,947 mil lbs 2015: 3,432 (+16.5%) 2016: 3,045 (-11.3%)
Source: USDA/ERS

40. Cattle-Beef Wrap-Up Broad 2015/16 Profitability Situation & Outlook
Industry at tipping point on role of tight supplies
Cow-calf: Good (but not 2014)
Backgrounding: Discouraging, with lots of $ tied up
Feedlot: Struggle, with lots of $ tied up

41. Key factors impacting hog-pork market
Crops/feedstuffs – ADVANTAGEOUS for the industry.
Size of industry driven by last year’s profitability – Some calculated restraint?
BIG changes in some state inventories – Rebuild and/or growth?
Productivity to guide 2016 hog supply prospects – AND weights something to watch.
U.S. consumer demand has been GOOD – Will it continue?
International trade a bit of a drag but improving – U.S. dollar impacts but lower prices on the way?

43. USDA Quarterly Hogs and Pigs Report – United States
September 25, 2015
2015 as %
Pre-Report
Actual -
2014
2015
of 2014
Range
Estimate
Inventories on Sep 1 *
All hogs and pigs
65,979
68,395
103.7
103.6
0.1
Kept for breeding
5,920
5,986
101.1
100.3
0.8
Market
60,059
62,410
103.9
0.0
Under 50 pounds
20,390
20,291
99.5
100.2
-0.7
pounds
17,458
17,986
103.0
103.2
-0.2
pounds
12,112
13,080
108.0
106.6
1.4
180 pounds and over
10,098
11,053
109.5
109.7
Farrowing **
Jun – Aug sows farrowed
2,991
2,944
98.4
98.1
0.3
Sep – Nov intentions
2,994
2,920
97.5
97.2
Dec – Feb intentions
2,895
2,875
99.3
99.1
0.2
Jun – Aug Pig Crop *
30,402
30,585
100.6
100.4
Jun – Aug Pigs per Litter
10.16
10.39
102.3
102.4
-0.1
* 1,000 head
** 1,000 litters
Data Source: USDA/NASS. Urner Barry pre-report estimates

44. 8.9% (vs. ‘14 since 1st wk of Sep)
New Pork Packing Plants (2017)
Sioux City, IA ― Seaboard/Triumph
Coldwater, MI ― Clements Foods
2015-YTD
8.7% (vs. 2014)
3.3% (vs )
8.9% (vs. ‘14 since 1st wk of Sep)
Data Source: USDA/AMS. * Steve Meyer, Vice President, Pork Analysis, Express Markets Inc. Analytics.

45. Data Source: USDA/AMS

46. U.S. Pork Exports, Jan-Oct 2015
(Volume excluding by-products & variety meats)
Oct-15/Sep-15
Oct-15/Oct-14
Year-to-Date
Country
Percent
1,000 lbs
Japan
-10%
-4%
-40,063
Mexico 3%
10%
134,708
12%
Canada
-15%
-1%
-15,458
-3%
South Korea
50%
-6%
104,843
34%
China (Mainland)
-9% 7%
-92,686
-30%
Hong Kong
126%
45%
-12,032
-12%
Australia
-25%
87%
13,165
Philippines
-11%
99%
-24,900
-29%
China (Taiwan)
29%
378%
11,199
49%
Honduras 5%
11,100
27%
Colombia
38% 6%
-17,701
-16%
Dominican Republic 1%
60%
14,422
36%
Chile
-22%
-41%
2,144
Other Countries
23%
-107,287
-39%
Total 2%
-18,544
-0.5%
WASDE U.S.: 2014: 4,857 mil lbs : 4,996 (+2.9% vs 2014) : 5,225 (+4.6% vs 2015)
Source: USDA/ERS

47. LMIC Pork Production and Price Quarterly Forecasts (12/7/15)
Sources: USDA/NASS; USDA/AMS Livestock Market News; Projections and Forecasts by LMIC
Year
Comm’l
% Chg.
Avg Carcass
Comm’l Pork
Quarter
Slaughter
Year Ago
Weight
Production
2015 I
28,723
5.9
215
0.8
6,161
6.5 II
27,848
8.9
213
-1.1
5,925
7.6
III
28,474
11.4
209
-1.5
5,957
9.8 IV
30,243
5.7
214
-0.2
6,478
115,288
7.9
-0.5
24,521
7.3
2016
29,161
1.5
6,257
1.6
27,536
0.2
5,877
-0.8
28,319
0.1
5,929
30,435
0.6
0.3
6,537
0.9
115,451
24,600
2017
29,909
2.6
6,431
2.8
28,163
2.3
6,023
2.5
28,495
210
5,976
31,335
3.0
6,742
3.1
117,902
2.1
25,172

48. LMIC Pork Production and Price Quarterly Forecasts (12/7/15)
Sources: USDA/NASS; USDA/AMS Livestock Market News; Projections and Forecasts by LMIC
Year
Nat’l Wtd
% Chg.
Quarter
Avg Base Price
Year Ago
2015 I
68.55
-25.0
51.41 II
73.52
-34.3
55.14
III
74.60
-32.3
55.95 IV
63-64
-29.5
47-48
70-71
-30.2
52-53
2016
64-66
-5.2
48-50
74-78
3.4
56-59
75-80
4.0
56-60
65-71
7.1
49-53
71-73
2.1
53-55
2017
62-69
0.8
47-52
70-78
-2.6
53-59
70-79
-3.9
60-70
-4.4
45-53
66-74
-2.8
50-56

49. Choice All Fresh Pork Broiler Turkey Oct-15/Sep-15 0.0% -0.3% 1.4%
0.8%
1.3%
Oct-15/Oct-14
-0.2%
1.8%
-4.2%
-1.2%
-6.5%
Data Source: USDA/ERS, BLS

50. Thank you for your time. Any questions. My web site: http://www2. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: