Associate Professor/Crop Markets Specialist Crop Market Outlook Ag Leader Technology Ames, Iowa Aug. 25, 2014 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 97.2 95.4 91.6 Yield (bu./acre) 152.8 147.2 123.4 158.8 167.4 Production (mil. bu.) 12,447 12,360 10,780 13,925 14,032 Beg. Stocks 1,708 1,128 989 821 1,181 Imports 28 29 162 35 30 Total Supply 14,182 13,517 11,932 14,781 15,243 Feed & Residual 4,795 4,557 4,329 5,175 5,250 Ethanol 5,019 5,000 4,648 5,120 5,075 Food, Seed, & Other 1,407 1,428 1,403 1,385 Exports 1,834 1,543 731 1,920 1,725 Total Use 13,055 12,528 11,111 13,600 13,435 Ending Stocks 1,808 Season-Average Price ($/bu.) 5.18 6.22 6.89 4.45 3.90 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 76.5 84.8 Yield (bu./acre) 43.5 41.9 39.8 43.3 45.4 Production (mil. bu.) 3,329 3,094 3,034 3,289 3,816 Beg. Stocks 151 215 169 141 140 Imports 14 16 36 80 15 Total Supply 3,495 3,325 3,239 3,509 3,971 Crush 1,648 1,703 1,689 1,725 1,755 Seed & Residual 130 88 90 5 111 Exports 1,501 1,365 1,320 1,640 1,675 Total Use 3,280 3,155 3,099 3,369 3,541 Ending Stocks 430 Season-Average Price ($/bu.) 11.30 12.50 14.40 13.00 10.35 Source: USDA-WAOB 3 3

Crop Shifts Source: USDA-NASS

Projected Corn Yields Top: 2014 Yield Bottom: Change from 2013 Units: Bu/acre Source: USDA-NASS

Corn Objective Yield Data Source: USDA-NASS

Projected Soybean Yields Top: 2014 Yield Bottom: Change from 2013 Units: Bu/acre Source: USDA-NASS

World Corn Production Source: USDA-WAOB 8 8

World Soybean Production Source: USDA-WAOB 9 9

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 12 12

Corn Export Shifts Source: USDA-FAS

Corn Export Sales Source: USDA-FAS

Soybean Export Sales Source: USDA-FAS

Soy Export Shifts Source: USDA-FAS

Corn Grind for Ethanol

Current Corn Futures 3.92 3.57 Source: CME Group, 8/22/2014

Current Soybean Futures 10.19 10.12 Source: CME Group, 8/22/2014

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

2013/14 Crop Prices

2014/15 Crop Margins

3-Month Temperature Outlook Source: NOAA-CPC

3-Month Precipitation Outlook Source: NOAA-CPC

Thoughts for 2014 and Beyond Supply/demand concerns Record acreage for soybeans, much larger shift than expected Projected record corn and soybean crops Markets have adjusted downward to absorb projected supplies El Niño watch continues 2013/14 USDA 2014/15 Futures (8/22/14) Corn $4.45 $3.90 $4.47 $3.57 Soybeans $13.00 $10.35 $13.05 $10.19

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/