Grain Price Trends, Now and Future Central Iowa Farm Business Association Annual Meeting Ft. Dodge, Iowa August 2, 2011 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911 1 1
U.S. Corn Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 86.0 86.4 88.2 92.3 Yield (bu./acre) 153.9 164.7 152.8 158.7 Production (mil. bu.) 12,092 13,092 12,447 13,470 Beg. Stocks 1,624 1,673 1,708 880 Imports 14 8 30 20 Total Supply 13,729 14,774 14,185 14,370 Feed & Residual 5,182 5,140 5,000 5,050 Ethanol 3,709 4,568 5,150 Food, Seed, & Other 1,316 1,371 1,380 1,400 Exports 1,849 1,987 1,875 1,900 Total Use 12,056 13,066 13,305 13,500 Ending Stocks 870 Season-Average Price ($/bu.) 4.06 3.55 5.25 6.00 2 2
U.S. Soybean Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 75.7 77.5 77.4 75.2 Yield (bu./acre) 39.7 44.0 43.5 43.4 Production (mil. bu.) 2,967 3,359 3,329 3,225 Beg. Stocks 205 138 151 200 Imports 13 15 Total Supply 3,185 3,512 3,495 3,440 Crush 1,662 1,752 1,650 1,655 Seed & Residual 106 108 125 115 Exports 1,279 1,501 1,520 1,495 Total Use 3,047 3,361 3,295 3,265 Ending Stocks 175 Season-Average Price ($/bu.) 9.97 9.59 11.35 13.00 3 3
Corn Area Source: USDA-NASS
Soybean Area Source: USDA-NASS
Crop Conditions Source: USDA-NASS
Crop Conditions & Corn Yields
Crop Conditions & Soybean Yields
World Corn Production Source: USDA 9 9
Corn – Argentina & Brazil Source: USDA 10 10
World Soybean Production Source: USDA 11 11
Soybeans – Argentina & Brazil Source: USDA 12 12
Exchange Rates (Jan. 2003 = 1) Source: USDA, ERS
Export Pace vs. Last Year Source: USDA, FAS
Corn Export Shifts Source: USDA, FAS
Soybean Export Shifts Source: USDA, FAS
Corn Advance Export Sales Source: USDA, FAS
Corn Advance Export Sales Source: USDA, FAS
Soy Advance Export Sales Source: USDA, FAS
Soy Advance Export Sales Source: USDA, FAS
Nearby Futures (Jan. 3, 2011 = 1) 21 21
Ethanol Margin Source: CARD
Ethanol Blending Advantage
Corn Grind for Ethanol
Projected 2011 Season-Average Corn Price
Projected 2011 Season-Average Soy Price
Corn Prices vs. Costs
Soybean Prices vs. Costs
Input Costs Source: USDA, Agricultural Prices, July 29, 2011
Thoughts for 2011 and Beyond General economic conditions Continued worldwide economic recovery is a major key for crop prices Debt limit, US credit rating US job recovery, European financial concerns, Chinese inflation Supply/demand concerns Prevented planting, flooding, heat wave, nighttime temps? Biofuel growth and energy demand Will supply be able to keep pace with demand? 2010/11: USDA: Corn $5.25, Soy $11.35 2011/12: USDA: Corn $6.00, Soy $13.00 Futures (as of 8/1/2011): Corn $6.64, Soy $13.24
Price Projections Source: USDA
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/