University Extension/Department of Economics Grain Marketing in 2011 Boone Crop Fair Boone, Iowa Feb. 18, 2011 Chad Hart Assistant Professor/Grain Markets Specialist

University Extension/Department of Economics U.S. Corn Supply and Use Source: USDA Area Planted(mil. acres) Yield(bu./acre) Production(mil. bu.)13,03812,09213,09212,447 Beg. Stocks(mil. bu.)1,3041,6241,6731,708 Imports(mil. bu.) Total Supply(mil. bu.)14,36213,72914,77414,175 Feed & Residual(mil. bu.)5,9135,1825,1405,200 Ethanol(mil. bu.)3,0493,7094,5684,950 Food, Seed, & Other(mil. bu.)1,3381,3161,3711,400 Exports(mil. bu.)2,4371,8491,9871,950 Total Use(mil. bu.)12,73712,05613,06613,500 Ending Stocks(mil. bu.)1,6241,6731, Season-Average Price($/bu.)

University Extension/Department of Economics U.S. Soybean Supply and Use Area Planted(mil. acres) Yield(bu./acre) Production(mil. bu.)2,6772,9673,3593,329 Beg. Stocks(mil. bu.) Imports(mil. bu.) Total Supply(mil. bu.)3,2613,1853,5123,495 Crush(mil. bu.)1,8031,6621,7521,655 Seed & Residual(mil. bu.) Exports(mil. bu.)1,1591,2791,5011,590 Total Use(mil. bu.)3,0563,0473,3613,355 Ending Stocks(mil. bu.) Season-Average Price($/bu.) Source: USDA

University Extension/Department of Economics World Corn Production Source: USDA

University Extension/Department of Economics World Soybean Production Source: USDA

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

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

University Extension/Department of Economics Corn Export Sales Source: USDA, FAS

University Extension/Department of Economics 2010 U.S. Corn Exports Source: USDA, FAS

University Extension/Department of Economics Corn 2011 Export Sales Source: USDA, FAS

University Extension/Department of Economics Soybean Export Sales Source: USDA, FAS

University Extension/Department of Economics 2010 U.S. Soybean Exports Source: USDA, FAS

University Extension/Department of Economics Soy 2011 Export Sales Source: USDA, FAS

University Extension/Department of Economics Renewable Fuels Standard (RFS) Crop Year Billion Bushels

University Extension/Department of Economics Ethanol Margins Source: ISU, CARD

University Extension/Department of Economics Ethanol Margins Source: ISU, CARD

University Extension/Department of Economics Ethanol Blending Advantage

University Extension/Department of Economics Fuel Prices

University Extension/Department of Economics Projected 2010 Season-Average Corn Price

University Extension/Department of Economics Projected 2010 Season-Average Soy Price

University Extension/Department of Economics Projected 2011 Season-Average Corn Price

University Extension/Department of Economics Projected 2011 Season-Average Soy Price

University Extension/Department of Economics Iowa Corn Prices vs. Costs

University Extension/Department of Economics Iowa Soybean Prices vs. Costs

University Extension/Department of Economics Principal Crop Area Source: USDA-NASS

University Extension/Department of Economics States with Room to Grow StateMillion acresCompeting Crops North Dakota2.249Wheat, corn, soy South Dakota1.400Wheat, corn, soy Missouri0.930Rice, cotton, soy Arkansas0.715Rice, cotton, soy Illinois0.535Wheat, corn, soy Texas0.466Cotton, corn, soy Georgia0.395Cotton, corn, soy Mississippi0.284Cotton, rice, soy North Carolina0.284Cotton, corn, soy Louisiana0.283Rice, cotton, soy

University Extension/Department of Economics New Crop Futures Price Movements WheatCornSoybeansCotton MGE Sept.CME Dec.CME Nov.ICE Dec. ($/bu.) ($/lb.) June Feb Change73%52%49%77%

University Extension/Department of Economics Projected Crop Margins

University Extension/Department of Economics Thoughts for 2011 and Beyond  General economic conditions  Continued economic recovery is a major key for crop prices  Fears of Chinese inflation and credit tightening have hit the markets  Long-term oil prices are now in the $100 range  Supply/demand concerns  South America: La Niña impacts (Argentina, Brazil )  Biofuels: E10, E12, or E15; Ethanol & Biodiesel tax credits renewed  Will supply be able to keep pace with demand?  2010/11:USDA:Corn $5.40, Soy $11.70 Futures (as of 2/17/2011):Corn $5.67, Soy $12.11  2011/12: Futures (as of 2/17/2011):Corn $5.99, Soy $13.18

University Extension/Department of Economics Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: