Crop Market Outlook Iowa Institute for Cooperatives Meeting Ames, Iowa Nov. 20, 2012 Chad Hart Associate Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911 1 1

U.S. Corn Supply and Use 2008 2009 2010 2011 2012 Area Planted (mil. acres) 86.0 86.4 88.2 91.9 96.9 Yield (bu./acre) 153.9 164.7 152.8 147.2 122.3 Production (mil. bu.) 12,092 13,092 12,447 12,358 10,725 Beg. Stocks 1,624 1,673 1,708 1,128 988 Imports 14 8 28 29 100 Total Supply 13,729 14,774 14,182 13,515 11,814 Feed & Residual 5,182 5,125 4,795 4,547 4,150 Ethanol 3,709 4,591 5,019 5,011 4,500 Food, Seed, & Other 1,316 1,370 1,407 1,426 1,367 Exports 1,849 1,980 1,834 1,543 1,150 Total Use 12,056 13,066 13,055 12,527 11,167 Ending Stocks 647 Season-Average Price ($/bu.) 4.06 3.55 5.18 6.22 7.60 Source: USDA-WAOB 2 2

U.S. Soybean Supply and Use 2008 2009 2010 2011 2012 Area Planted (mil. acres) 75.7 77.5 77.4 75.0 77.2 Yield (bu./acre) 39.7 44.0 43.5 41.9 39.3 Production (mil. bu.) 2,967 3,359 3,329 3,094 2,971 Beg. Stocks 205 138 151 215 169 Imports 13 15 14 16 20 Total Supply 3,185 3,512 3,495 3,325 3,160 Crush 1,662 1,752 1,648 1,703 1,560 Seed & Residual 106 110 130 91 115 Exports 1,279 1,499 1,501 1,362 1,345 Total Use 3,047 3,361 3,280 3,155 3,021 Ending Stocks 140 Season-Average Price ($/bu.) 9.97 9.59 11.30 12.50 14.90 Source: USDA-WAOB 3 3

Projected Corn Yields

Projected Soybean Yields

World Corn Production Source: USDA-WAOB 6 6

World Soybean Production Source: USDA-WAOB 7 7

World Weather Source: USDC and USDA 8 8

U.S. Meat Production & Prices Higher feed costs have led to lower meat production projections. Source: USDA-WAOB 9 9

Corn Export Shifts Source: USDA-FAS

Soy Export Shifts Source: USDA-FAS

Corn Grind for Ethanol Negative margins at some ethanol plants have dragged down production.

Current Corn Futures 6.83 5.83 5.49 Source: CME Group, 11/19/2012

Current Soybean Futures 13.38 12.16 11.81 Source: CME Group, 11/19/2012

Acreage Shift by State Top: Planted in 2012 Bottom: Change from 2011 Weather was great for planting in 2012 (just not for producing). To hold acreage we will need great planting weather again. Top: Planted in 2012 Bottom: Change from 2011 Units: 1,000 acres Source: USDA-NASS

Thoughts for 2012 and Beyond Supply/demand concerns Soil moisture issues Biofuel and export strength Worldwide response to drought-induced pricing 2012/13 USDA Futures (11/19/12) 2013/14 Corn $7.60 $6.83 $5.83 Soybeans $14.90 $13.38 $12.16

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/