2011 Crop Market Outlook Coleman Research Group Presentation Sept. 1, 2011 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911 1 1
U.S. Corn Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 86.0 86.4 88.2 92.3 Yield (bu./acre) 153.9 164.7 152.8 153.0 Production (mil. bu.) 12,092 13,092 12,447 12,914 Beg. Stocks 1,624 1,673 1,708 940 Imports 14 8 30 20 Total Supply 13,729 14,774 14,185 13,874 Feed & Residual 5,182 5,140 5,000 4,900 Ethanol 3,709 4,568 5,020 5,100 Food, Seed, & Other 1,316 1,371 1,400 1,410 Exports 1,849 1,987 1,825 1,750 Total Use 12,056 13,066 13,245 13,160 Ending Stocks 910 714 Season-Average Price ($/bu.) 4.06 3.55 5.25 6.70 2 2
U.S. Soybean Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 75.7 77.5 77.4 75.0 Yield (bu./acre) 39.7 44.0 43.5 41.4 Production (mil. bu.) 2,967 3,359 3,329 3,056 Beg. Stocks 205 138 151 230 Imports 13 15 Total Supply 3,185 3,512 3,495 3,301 Crush 1,662 1,752 1,645 1,635 Seed & Residual 106 110 125 111 Exports 1,279 1,499 1,495 1,400 Total Use 3,047 3,361 3,265 3,146 Ending Stocks 155 Season-Average Price ($/bu.) 9.97 9.59 11.35 13.50 3 3
U.S. Wheat Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 63.2 59.2 53.6 55.2 Yield (bu./acre) 44.9 44.5 46.4 45.2 Production (mil. bu.) 2,499 2,218 2,208 2,077 Beg. Stocks 306 657 976 861 Imports 127 119 97 100 Total Supply 2,932 2,993 3,281 3,037 Food 927 919 930 945 Seed 78 69 73 82 Feed & Residual 255 150 129 240 Exports 1,015 879 1,289 1,100 Total Use 2,275 2,018 2,420 2,367 Ending Stocks 671 Season-Average Price ($/bu.) 6.78 4.87 5.70 7.60 4 4
World Corn Production Source: USDA 5 5
World Soybean Production Source: USDA 6 6
World Wheat Production Source: USDA 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: Shane Ellis, 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: Shane Ellis, ISU Extension
Corn vs. Wheat Source: CME Group, 8/29/2011
Corn Export Sales Source: USDA, FAS
Corn Advance Export Sales Source: USDA, FAS
Soybean Export Sales Source: USDA, FAS
Soy Advance Export Sales Source: USDA, FAS
Wheat Export Sales Source: USDA, FAS
Wheat Export Shifts Source: USDA, FAS
Renewable Fuels Standard (RFS) Crop Year Billion Bushels 2009 4.11 2010 4.43 2011 4.64 2012 4.86 17 17
Ethanol Margins Source: CARD
Ethanol Margins Source: CARD
Ethanol Blending Advantage
Corn Grind for Ethanol Source: DOE, EIA
Ethanol Stocks Source: DOE, EIA
Nearby Futures (Jan. 3, 2011 = 1) 23 23
Projected Corn Yields Source: USDA-NASS
Projected Soybean Yields Source: USDA-NASS
Winter Wheat Yields Last Year KS 45 OK 31 TX 34 US 46.8 Source: USDA-NASS
Projected Spring Wheat Yields Projected Change in Production Hard Red Spring -17% White +3% Durum -47% Source: USDA-NASS
Projected 2011 Season-Average Corn Price
Projected 2011 Season-Average Soy Price
Projected ‘11 Season-Average Wheat Price
Thoughts for 2011 and Beyond General economic conditions Continued worldwide economic recovery is a major key for crop prices Supply/demand concerns Droughts, floods, heat waves, etc. Biofuel growth and energy demand Will supply be able to keep pace with demand? 2011/12 USDA Futures (8/29/11) 2012/13 Corn $6.70 $7.42 $6.48 Soybeans $13.50 $14.00 $13.26 Wheat $7.60 $7.89 $8.34
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/