1. How to Manage Your Bottom Line in a Global Market
West Central Market Outlook Series
Menlo, Iowa
Feb. 17, 2014
Chad Hart
Associate Professor/Crop Markets Specialist 1 1

2. U.S. Corn Supply and Use 2009 2010 2011 2012 2013 Area Planted
(mil. acres)
86.4
88.2
91.9
97.2
95.4
Yield
(bu./acre)
164.7
152.8
147.2
123.4
158.8
Production
(mil. bu.)
13,092
12,447
12,360
10,780
13,925
Beg. Stocks
1,673
1,708
1,128
989
821
Imports 8 28 29
162 35
Total Supply
14,774
14,182
13,517
11,932
14,781
Feed & Residual
5,125
4,795
4,557
4,335
5,300
Ethanol
4,591
5,019
5,000
4,648
Food, Seed, & Other
1,370
1,407
1,428
1,396
1,400
Exports
1,980
1,834
1,543
731
1,600
Total Use
13,066
13,055
12,528
11,111
13,300
Ending Stocks
1,481
Season-Average Price
($/bu.)
3.55
5.18
6.22
6.89
4.50
Source: USDA-WAOB 2 2

3. U.S. Soybean Supply and Use
2009
2010
2011
2012
2013
Area Planted
(mil. acres)
77.5
77.4
75.0
77.2
76.5
Yield
(bu./acre)
44.0
43.5
41.9
39.8
43.3
Production
(mil. bu.)
3,359
3,329
3,094
3,034
3,289
Beg. Stocks
138
151
215
169
141
Imports 15 14 16 36 30
Total Supply
3,512
3,495
3,325
3,239
3,459
Crush
1,752
1,648
1,703
1,689
1,700
Seed & Residual
110
130 88 90 99
Exports
1,499
1,501
1,365
1,320
1,510
Total Use
3,361
3,280
3,155
3,099
3,309
Ending Stocks
150
Season-Average Price
($/bu.)
9.59
11.30
12.50
14.40
12.70
Source: USDA-WAOB 3 3

4. Corn Yields Top: 2013 Yield Bottom: Change from 2012
Units: Bushels/acre
Source: USDA-NASS

5. Soybean Yields Top: 2013 Yield Bottom: Change from 2012
Units: Bushels/acre
Source: USDA-NASS

6. World Corn Production
Source: USDA-WAOB 6 6

7. World Soybean Production
Source: USDA-WAOB 7 7

8. U.S. Meat Production & Prices
Source: USDA-WAOB 8 8

9. Corn Export Shifts
Source: USDA-FAS

10. Soy Export Shifts
Source: USDA-FAS

11. Corn Grind for Ethanol

12. Current Corn Futures
4.49
4.48
4.42
Source: CME Group, 2/14/2014

13. Current Soybean Futures
12.82
10.96
10.64
Source: CME Group, 2/14/2014

14. Corn Revenues vs. Costs
Sources: USDA-NASS, Duffy

15. Soybean Revenues vs. Costs
Sources: USDA-NASS, Duffy

16. Corn Costs
98%
81%
57%

17. Soy Costs
98%
46%
85%

18. Crop Insurance
Corn
Soy
Source: RMA

19. Price Risk in Pieces
Futures
Basis

20. Crop Marketing Matrix Higher Futures Expected Change Strengthen Basis
Store & wait
Delayed price contract
Minimum price contract
Basis contract
Sell cash and buy futures/call option
Minimum price contract
Futures
Expected
Change
Strengthen
Basis
Basis
Weaken
Hedge
Non-roll hedge to arrive
Buy put option
Cash sale now
Cash forward contract
Futures
Lower

21. 2013/14 Crop Prices

22. 2014/15 Crop Margins

23. Thank you for your time. Any questions. My web site: http://www. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: