Associate Professor/Crop Markets Specialist 2015 Crop Market Outlook Feb. 3, 2015 Chad Hart Associate Professor/Crop Markets Specialist chart@iastate.edu 515-294-9911 1 1

U.S. Corn Supply and Use 2010 2011 2012 2013 2014 Area Planted (mil. acres) 88.2 91.9 97.3 95.4 90.6 Yield (bu./acre) 152.8 147.2 123.1 158.1 171.0 Production (mil. bu.) 12,447 12,360 10,755 13,829 14,216 Beg. Stocks 1,708 1,128 989 821 1,232 Imports 28 29 160 36 25 Total Supply 14,182 13,517 11,904 14,686 15,472 Feed & Residual 4,795 4,557 4,315 5,036 5,275 Ethanol 5,019 5,000 4,641 5,134 5,175 Food, Seed, & Other 1,407 1,428 1,397 1,367 1,395 Exports 1,834 1,543 730 1,917 1,750 Total Use 13,055 12,528 11,083 13,454 13,595 Ending Stocks 1,877 Season-Average Price ($/bu.) 5.18 6.22 6.89 4.46 3.65 Source: USDA-WAOB 2 2

U.S. Soybean Supply and Use 2010 2011 2012 2013 2014 Area Planted (mil. acres) 77.4 75.0 77.2 76.8 83.7 Yield (bu./acre) 43.5 41.9 40.0 44.0 47.8 Production (mil. bu.) 3,329 3,094 3,042 3,358 3,969 Beg. Stocks 151 215 169 141 92 Imports 14 16 41 72 15 Total Supply 3,495 3,325 3,252 3,570 4,076 Crush 1,648 1,703 1,689 1,734 1,780 Seed & Residual 130 88 105 97 116 Exports 1,501 1,365 1,317 1,647 1,770 Total Use 3,280 3,155 3,111 3,478 3,666 Ending Stocks 410 Season-Average Price ($/bu.) 11.30 12.50 14.40 13.00 10.20 Source: USDA-WAOB 3 3

Corn Yields Top: 2014 Yield Bottom: Change from last year Units: Bu/acre Source: USDA-NASS

Soybean Yields Top: 2014 Yield Bottom: Change from last month Units: Bu/acre Source: USDA-NASS

World Corn Production Source: USDA-WAOB 6 6

World Soybean Production Source: USDA-WAOB 7 7

Hog Crush Margin 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 futures Corn: 10 bushels per pig Soybean meal: 150 pounds per pig Source: ISU Extension

Cattle Crush Margin 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 Source: ISU Extension

U.S. Meat Production & Prices Source: USDA-WAOB 10 10

Corn Export Shifts Source: USDA-FAS

Corn Export Sales Source: USDA-FAS

Soybean Export Shifts Source: USDA-FAS

Soybean Export Shifts Source: USDA-FAS

Crude Oil Prices Sources: EIA and CME

Global Crude Oil Market Source: EIA

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

Corn Grind for Ethanol

Ethanol Stocks

Current Corn Futures 3.82 3.63 Source: CME Group, 1/30/2015

Current Soybean Futures 9.88 9.13 Source: CME Group, 1/30/2015

Corn Prices vs. Costs Per Bushel Cost calculated as Per Acre Cost from ISU Extension divided by Actual Yield per Acre Sources: USDA-NASS for Prices, Duffy for Costs

Soybean Prices vs. Costs Per Bushel Cost calculated as Per Acre Cost from ISU Extension divided by Actual Yield per Acre Sources: USDA-NASS for Prices, Duffy for Costs

2014/15 Crop Margins

2015/16 Crop Margins

Thoughts for 2015 and Beyond Supply/demand concerns Record corn and soybean crops, but also record demand Markets are in a holding pattern, waiting for news Watching South American crop progress Projected negative margins for 2014 and 2015 crops 2013/14 USDA 2014/15 Futures (1/30/15) 2015/16 Corn $4.46 $3.65 $3.63 $3.82 Soybeans $13.00 $10.20 $9.88 $9.13

Thank you for your time. Any questions. My web site: http://www. econ 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/