Crop Market Outlook Anderson Crop Insurance Meeting Aurelia, Iowa Feb. 21, 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 92.0 Yield (bu./acre) 152.8 147.2 123.4 158.8 165.3 Production (mil. bu.) 12,447 12,360 10,780 13,925 13,985 Beg. Stocks 1,708 1,128 989 821 1,481 Imports 28 29 162 35 25 Total Supply 14,182 13,517 11,932 14,781 15,491 Feed & Residual 4,795 4,557 4,335 5,300 5,400 Ethanol 5,019 5,000 4,648 Food, Seed, & Other 1,407 1,428 1,396 1,400 1,430 Exports 1,834 1,543 731 1,600 1,550 Total Use 13,055 12,528 11,111 13,300 13,380 Ending Stocks 2,111 Season-Average Price ($/bu.) 5.18 6.22 6.89 4.50 3.90 Source: USDA-WAOB for 2010-13 2 2

U.S. Soybean Supply and Use 2010 2011 2012 2013 Area Planted (mil. acres) 77.4 75.0 77.2 76.5 79.5 Yield (bu./acre) 43.5 41.9 39.8 43.3 45.2 Production (mil. bu.) 3,329 3,094 3,034 3,289 3,550 Beg. Stocks 151 215 169 141 150 Imports 14 16 36 30 15 Total Supply 3,495 3,325 3,239 3,459 3,715 Crush 1,648 1,703 1,689 1,700 1,725 Seed & Residual 130 88 90 99 105 Exports 1,501 1,365 1,320 1,510 1,600 Total Use 3,280 3,155 3,099 3,309 3,430 Ending Stocks 285 Season-Average Price ($/bu.) 11.30 12.50 14.40 12.70 9.65 Source: USDA-WAOB for 2010-13 3 3

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

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

World Corn Production Source: USDA-WAOB 6 6

World Soybean Production Source: USDA-WAOB 7 7

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

Corn Export Shifts Source: USDA-FAS

Soy Export Shifts Source: USDA-FAS

Corn Grind for Ethanol

Current Corn Futures 4.53 4.49 4.45 Source: CME Group, 2/21/2014

Current Soybean Futures 12.94 11.21 10.73 Source: CME Group, 2/21/2014

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

Corn Costs 98% 81% 57%

Crop Insurance Corn Soy Source: RMA

2013/14 Crop Prices

2014/15 Crop Margins

Thoughts for 2014 and Beyond Supply/demand concerns Demand rebounding? Yes, so far, so good Acreage allocation for 2014: Where do the extra corn acres go? Markets favoring soybeans in the short term and corn longer term 2013/14 USDA 2014/15 Unofficial Futures (2/21/14) Corn $4.50 $3.90 $4.53 $4.45 Soybeans $12.70 $9.65 $12.94 $11.21

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/