Crop Markets Philippines Harvest Tour of Iowa Ames, Iowa Oct. 20, 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 91.9 Yield (bu./acre) 153.9 164.7 152.8 148.1 Production (mil. bu.) 12,092 13,092 12,447 12,433 Beg. Stocks 1,624 1,673 1,708 1,128 Imports 14 8 27 15 Total Supply 13,729 14,774 14,182 13,576 Feed & Residual 5,182 5,125 4,803 4,700 Ethanol 3,709 4,591 5,020 5,000 Food, Seed, & Other 1,316 1,370 1,395 1,410 Exports 1,849 1,980 1,835 1,600 Total Use 12,056 13,066 13,053 12,710 Ending Stocks 866 Season-Average Price ($/bu.) 4.06 3.55 5.18 6.70 Source: USDA-WAOB 2 2

U.S. Soybean Supply and Use 2008 2009 2010 2011 Area Planted (mil. acres) 75.7 77.5 77.4 75.0 Yield (bu./acre) 39.7 44.0 43.5 41.5 Production (mil. bu.) 2,967 3,359 3,329 3,060 Beg. Stocks 205 138 151 215 Imports 13 15 Total Supply 3,185 3,512 3,495 3,290 Crush 1,662 1,752 1,648 1,635 Seed & Residual 106 110 132 120 Exports 1,279 1,499 1,500 1,375 Total Use 3,047 3,361 3,280 3,130 Ending Stocks 160 Season-Average Price ($/bu.) 9.97 9.59 11.30 13.15 Source: USDA-WAOB 3 3

Projected Corn Yields Source: USDA-NASS

Projected Soybean Yields Source: USDA-NASS

World Corn Production Source: USDA-WAOB 7 7

World Soybean Production Source: USDA-WAOB 8 8

Corn vs. Wheat Source: CME Group, 10/19/2011

Hog Crush Margin The Crush Margin is the return after the pig, corn and soybean meal costs. Carcass weight: 200 pounds Pig price: 50% of 5 mth out lean hog futures Corn: 10 bushels per pig Soybean meal: 150 pounds per pig Source: Shane Ellis, ISU Extension

Cattle Crush Margin The Crush Margin is the return after the feeder steer and corn costs. Live weight: 1250 pounds Feeder weight: 750 pounds Corn: 50 bushels per head Source: Shane Ellis, ISU Extension

Corn Export Sales Source: USDA-FAS

Corn Export Shifts Source: USDA-FAS

Soybean Export Sales Source: USDA-FAS

Soy Export Shifts Source: USDA-FAS

Corn Grind for Ethanol Source: DOE-EIA

Ethanol Margin Source: CARD

Ethanol Margins Source: CARD

Ethanol Blending Advantage

Projected 2011 Season-Average Corn Price

Projected 2011 Season-Average Soy Price

Projected 2012 Season-Average Corn Price

Projected 2012 Season-Average Soy Price

Iowa Corn Prices vs. Costs

Iowa Soybean Prices vs. Costs

Iowa Crop Margins

Thoughts for 2012 and Beyond General economic conditions Continued worldwide economic recovery is a major key for crop prices US job recovery, European financial concerns, Chinese inflation Supply/demand concerns Smaller than anticipated U.S. crops Biofuel growth and energy demand Corn still has the upper hand in the acreage competition Will supply be able to keep pace with demand? 2011/12: USDA: Corn $6.70; Soy $13.15 Futures (as of 10/19/11): Corn $6.23; Soy $11.94 2012/13: Futures (as of 10/19/11): Corn $5.76; Soy $11.73

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/