Grain Outlook For Dr. Robert Wisner Iowa State University Dr. Robert Wisner Iowa State University 5/17/2004
Trade-weighted U.S. $ June 04 Up 7.7% in three months
Feed Grain Outlook, Near-Record Low world grain stocks Foreign weather--bad last 2 years China: reduced role as corn exporter? ‘04 plantings—very slight corn increase, less sorghum Strong corn domestic & export demand—longer term implications Old & new crop prices highly volatile Beans—Old crop more than new 4/02/04
3/10/04
Cumulative Export Sales, vs. Yr. Ago 5/06/04 % Chg. Proj. % Chg. Corn Soybean meal Soybeans All Wheat Grain Sorghum
China Corn, USDA Export Projections vs. actual Projections too low, except for 1998 October March % 21% below actual % 65% below actual % 18% below actual % 20% below actual % 17% above actual % 17% below actual % 74% below actual
Inadequate data make China a hard Market to project.
Figure 4.
For discussion of Soybean yield problems, see:
On Average, farmers since 1996, planted 0.3% less corn than intended.
Questions for Corn Use Tight supplies--which users can out-bid others? What happens with occasional low U.S. yields? , 1983, 1988, 1993, 1995, 2002 U.S. production shift, beans to corn? Bring back part of 32 million CRP acres? Impact on land values & Ag structure? Impact on export firms? More investments such as Cargill’s Caribbean ethanol dehydration plant?
How Much Cut in May-Aug. SMB Use in Pork vs. Y/A? Poultry—record profits: 5-6% cut? Other non-pork uses: 16-18% cut? Pork 12-14% cut? Stocks beyond processors? Imports above USDA project.?
For discussion of Soybean yield problems, see:
Very Low world grain reserve Global grain exports may increase substantially -- if yields recover from 02 & 03 China: a major uncertainty Corn export sales likely strong to Aug. Ethanol expansion to continue strong, limiting future export growth potential Chart goals: $3.72, $3.89 if weather problem? Corn, wheat, protein meal prices explosive if major weather problems Significant downside risk in summer, fall Key Points