Associate Professor/Crop Marketing Specialist Ag Market Outlook Nov. 5, 2018 Chad Hart Associate Professor/Crop Marketing Specialist chart@iastate.edu 515-294-9911 1 1
Net Farm Income Source: USDA
Farm Debt Source: Federal Reserve
Ag Economic Summary Agricultural production and consumption has grown rapidly over the past several years. But when production exceeds consumption, prices fall. Crop revenues peaked in 2012-13, while livestock revenues crested in 2014-15, leading to record farm incomes. Since then net farm income has been cut in half. While the percentage loss in substantial, net farm income remains above levels from the early 2000’s. Farmers and ranchers have partially compensated for the loss in income by taking on higher debt loads. Farm and ranch balance sheets are eroding and financial stress is building for some producers, but the financial issues are not as severe as during the 1980’s. The squeeze is on farm finances and for some producers, the squeeze may be too much.
U.S. Corn Supply and Use 2015 2016 2017 2018 2019 Area Planted (mil. acres) 88.0 94.0 90.2 89.1 92.0 Yield (bu./acre) 168.4 174.6 176.6 180.7 176.5 Production (mil. bu.) 13,602 15,148 14,604 14,778 14,930 Beg. Stocks 1,731 1,737 2,293 2,140 1,813 Imports 67 57 36 50 Total Supply 15,401 16,942 16,934 16,968 16,793 Feed & Residual 5,120 5,470 5,302 5,550 5,575 Ethanol 5,224 5,432 5,601 5,650 5,700 Food, Seed, & Other 1,422 1,453 1,480 1,490 Exports 1,898 2,294 2,438 2,475 2,425 Total Use 13,664 14,649 14,793 15,155 15,190 Ending Stocks 1,603 Season-Average Price ($/bu.) 3.61 3.36 3.50 3.90 Source: USDA-WAOB 5 5
U.S. Soybean Supply and Use 2015 2016 2017 2018 2019 Area Planted (mil. acres) 82.7 83.4 90.1 89.1 82.5 Yield (bu./acre) 48.0 52.0 49.3 53.1 50.0 Production (mil. bu.) 3,926 4,296 4,411 4,690 4,090 Beg. Stocks 191 197 302 438 885 Imports 24 22 25 Total Supply 4,140 4,515 4,734 5,153 5,000 Crush 1,886 1,901 2,055 2,070 2,075 Seed & Residual 122 146 112 138 127 Exports 1,936 2,166 2,129 2,060 Total Use 3,944 4,214 4,268 4,277 Ending Stocks 723 Season-Average Price ($/bu.) 8.95 9.47 9.33 8.60 8.75 Source: USDA-WAOB 6 6
Projected Corn Yields Top: 2018 Yield Estimate Bottom: Change from last month Units: Bushels per acre Source: USDA-NASS 7 7
U.S. Corn Harvest Data Source: USDA-NASS 8 8
Iowa Corn Harvest Data Source: USDA-NASS 9 9
Projected Soybean Yields Top: 2018 Yield Estimate Bottom: Change from last month Units: Bushels per acre Source: USDA-NASS 10 10
U.S. Soy Harvest Data Source: USDA-NASS 11 11
Iowa Soy Harvest Data Source: USDA-NASS 12 12
World Corn Production Source: USDA-WAOB 13 13
World Soybean Production Source: USDA-WAOB 14 14
U.S. Meat Production & Prices Source: USDA-WAOB 17 17
Pork Production Source: USDA-NASS
Pork Export Shifts Source: USDA-FAS
Beef Production Source: USDA-NASS
Beef Export Shifts Source: USDA-FAS
Corn Export Sales Source: USDA-FAS
Corn Export Shifts Source: USDA-FAS
Soybean Export Sales Source: USDA-FAS
Soybean Export Shifts Source: USDA-FAS
Soybean Market Shares Sales for 2017 crop Sales for 2018 crop Source: USDA-FAS
Ethanol Production Source: EIA
Ethanol Exports Source: EIA
Current Corn Futures 4.05 3.73 Source: CME Group, 11/2/2018
Current Soybean Futures 9.23 8.67 Source: CME Group, 11/2/2018
2018/19 Crop Margins Based on futures prices
2019/20 Crop Margins w/ 2018 Costs Based on futures prices
Iowa Corn Revenues vs. Costs Based on USDA prices
Iowa Soybean Revenues vs. Costs Based on USDA prices
Want to provide feedback on my presentation. https://www. surveymonkey
Thank you for your time. Any questions. My web site: http://www2. econ Thank you for your time! Any questions? My web site: http://www2.econ.iastate.edu/faculty/hart/ Iowa Farm Outlook: http://www2.econ.iastate.edu/ifo/ Ag Decision Maker: http://www.extension.iastate.edu/agdm/
Arable Land