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Ag Outlook Northwest Iowa Young & Beginning Farmer Gathering
Orange City, Iowa Feb. 27, 2017 Chad Hart Associate Professor/Crop Marketing Specialist 1 1
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U.S. Corn Supply and Use 2013 2014 2015 2016 2017 Area Planted
(mil. acres) 95.4 90.6 88.0 94.0 90.0 Yield (bu./acre) 158.1 171.0 168.4 174.6 170.7 Production (mil. bu.) 13,829 14,216 13,602 15,148 14,065 Beg. Stocks 821 1,232 1,731 1,737 2,320 Imports 36 32 67 55 50 Total Supply 14,686 15,479 15,401 16,940 16,435 Feed & Residual 5,040 5,280 5,131 5,600 5,450 Ethanol 5,124 5,200 5,206 5,350 5,400 Food, Seed, & Other 1,369 1,401 1,429 1,445 1,470 Exports 1,920 1,867 1,898 2,225 1,900 Total Use 13,454 13,748 13,664 14,620 14,220 Ending Stocks 2,215 Season-Average Price ($/bu.) 4.46 3.70 3.61 3.40 3.50 Source: USDA-WAOB , USDA-OCE 2017 2 2
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U.S. Soybean Supply and Use
2013 2014 2015 2016 2017 Area Planted (mil. acres) 76.8 83.3 82.7 83.4 88.0 Yield (bu./acre) 44.0 47.5 48.0 52.1 Production (mil. bu.) 3,358 3,927 3,926 4,307 4,180 Beg. Stocks 141 92 191 197 420 Imports 72 33 24 25 Total Supply 3,570 4,052 4,140 4,528 4,625 Crush 1,734 1,873 1,886 1,930 1,945 Seed & Residual 107 146 122 128 135 Exports 1,638 1,842 1,936 2,050 2,125 Total Use 3,478 3,862 3,944 4,108 4,205 Ending Stocks Season-Average Price ($/bu.) 13.00 10.10 8.95 9.50 9.60 Source: USDA-WAOB , USDA-OCE 2017 3 3
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Corn Yields Top: 2016 Yield Bottom: Change from last year
Units: Bushels/acre Source: USDA-NASS
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Soy Yields Top: 2016 Yield Bottom: Change from last year
Units: Bushels/acre Source: USDA-NASS
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World Corn Production Source: USDA-WAOB 6 6
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World Soybean Production
Source: USDA-WAOB 7 7
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U.S. Meat Production & Prices
Source: USDA-WAOB 8 8
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Corn Export Sales Source: USDA-FAS
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Change in Corn Export Sales
Source: USDA-FAS
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Soybean Export Sales Source: USDA-FAS
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Change in Soybean Export Sales
Source: USDA-FAS
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Strength of the U.S. Dollar
Source: Federal Reserve
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Corn Grind for Ethanol
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Crude Oil Prices Sources: EIA and CME
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Current Corn Futures 4.00 3.90 3.54 Source: CME Group, 2/24/2017
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Current Soybean Futures
9.92 9.76 9.57 Source: CME Group, 2/24/2017
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2016/17 Crop Margins @ Actual Yields
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2017/18 Crop Margins
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Iowa Corn Prices vs. Costs
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Iowa Soybean Prices vs. Costs
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U.S. Meat Production & Prices
Source: USDA-WAOB 22 22
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U.S. Meat Trade Source: USDA-WAOB 23 23
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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: ISU Extension
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Source: CME Group
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Data Source: USDA-ERS & USDA-FAS
Livestock Marketing Information Center
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Source: CME Group
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2013 = +$ [-$25.60 to +$24.57] 2014 = +$ [+$13.15 to +$107.25] 2015 = +$ [-$18.40 to +$26.25] 2016 = -$ [-$35.52 to +$32.92] 2017f = +$ [-$9.00 to +$25.93]
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Source: USDA/AMS. * Steve Meyer, EMI.
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U.S. Packing Capacity Under Construction
New pork packing Fall 2016 Summer/Fall 2017 Summer/Fall 2018 plants Daily Annual Pleasant Hope, MO 2,500 625,000 Windom, MN 4,000 1,000,000 Sioux City, IA 12,000 3,000,000 24,000 6,000,000 Coldwater, MI 10,000 2,500,000 Wright County, IA Total 6,500 1,625,000 28,500 7,125,000 50,500 12,625,000 Head per week 31,250 137,019 242,788 % of '15 avg = mil 1.4% 6.2% 11.1% % of '15 max = mil 1.2% 5.5% 9.7% Source: Steve Meyer. Published in National Hog Farmer Magazine, July 19, 2016. Source: Seaboard Triumph Foods plans to expand for second shift at Sioux City plant, February 17, 2017
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U.S. Pork Exports, Jan-Dec 2016
(Volume excluding by-products & variety meats) Dec-16/Nov-16 Dec-16/Dec-15 Year-to-Date Country Percent 1,000 lbs Japan -21% -6% -62,218 -5% Mexico 8% 23% 50,480 3% Canada -2% 6% 8,488 2% South Korea 20% 14% -87,182 -18% China (Mainland) -12% 67% 245,965 98% Hong Kong 5% -26% 22,267 18% Australia 21% 10% 10,562 Philippines -16% -1% 3,560 China (Taiwan) 101% -18,565 -49% Colombia 164% 9,820 9% Honduras -41% 12% 10,879 17% Dominican Republic 29% 9,134 Guatemala -44% -3% 2,162 Chile -65% 113% 5,675 Other Countries 28% 13,111 7% Total 15% 224,138 4% Source: USDA/ERS
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Cattle Crush Margin The Crush Margin is the return after the feeder steer and corn costs. Live weight: pounds Feeder weight: 750 pounds Corn: 50 bushels per head Source: ISU Extension
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Data Source: USDA/NASS
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Projections for 11/6/15 9/2/16 9/27/16 12/29/16 2016 $300 $78 $15 -$30
2017 $86 $22 -$29 Data Source: USDA & LMIC, Compiled by LMIC Livestock Marketing Information Center
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Data Source: USDA/AMS
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Data Source: USDA-AMS Livestock Marketing Information Center
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2013 = -$ [-$155 to +$77] 2014 = +$ [+$41 to +$269] 2015 = -$ [-$530 to +$43] 2016 = -$ [-$359 to +$113] 2017f = +$ [-$98 to +$208]
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U.S. Beef Exports, Jan-Dec 2016
(Volume excluding by-products & variety meats) Year-to-Date Country 1,000 lbs Percent Japan 116,965 22% South Korea 135,937 43% Mexico 31,090 9% Canada -15,332 -5% Hong Kong -21,827 -7% China (Taiwan) 28,220 26% Netherlands -3,890 -10% Chile 1,195 5% Philippines -8,114 -25% Vietnam 6,400 52% Dominican Republic -3,368 -16% United Arab Emirates 1,753 11% Italy -2,720 Guatemala 2,759 27% Other Countries 15,410 12% Total 284,478 13% Source: USDA/ERS
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U.S. Beef Imports, Jan-Dec 2016
(Volume excluding by-products & variety meats) Year-to-Date Country 1,000 lbs Percent Australia -491,059 -39% Canada 89,655 14% New Zealand -48,566 -7% Mexico 101,509 26% Nicaragua 7,438 7% Brazil 3,118 2% Uruguay -14,788 -11% Costa Rica -75 -0% Other Countries -2,306 -18% Total -355,074 Source: USDA/ERS
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AVERAGE VALUES all farmland 1941−2016 $7,183 As of Nov 16 -5.9%
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% Change in Nominal Iowa Farmland Values 1942-2016
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Land Values by County, 2016
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Percent Changes in Land Values from Nov 2015
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Farmland supply tends to be tighter in down years
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Iowa Farmland Purchases by Buyer Types 1989-2016
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A replay of 1920s or 1980s farm crisis?
Source: USDA-ERS, Ag DM C2-70, Zhang and Beek (2016) Farm Policy Journal
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Thank you for your time. Any questions. My web site: http://www2. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker:
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