1. Agricultural Markets 101
Climate Prediction Applications Science Workshop
Des Moines, Iowa
Feb. 21, 2011
Chad Hart
Assistant Professor/Grain Markets Specialist 1 1

2. Supply Demand U.S. Corn Supply and Use 2007 2008 2009 2010
Area Planted
(mil. acres)
93.5
86.0
86.4
88.2
Yield
(bu./acre)
150.7
153.9
164.7
152.8
Production
(mil. bu.)
13,038
12,092
13,092
12,447
Beg. Stocks
1,304
1,624
1,673
1,708
Imports 20 14 8
Total Supply
14,362
13,729
14,774
14,175
Feed & Residual
5,913
5,182
5,140
5,200
Ethanol
3,049
3,709
4,568
4,950
Food, Seed, & Other
1,338
1,316
1,371
1,400
Exports
2,437
1,849
1,987
1,950
Total Use
12,737
12,056
13,066
13,500
Ending Stocks
675
Season-Average Price
($/bu.)
4.20
4.06
3.55
5.40
Supply
Demand
The arrows show the changes from last month. Stocks continue to shrink. But even with national yields down to bushels per acre, we’re still looking at the 3rd largest corn crop ever. But it’s relatively short due to the strong demand for corn. Demand jumped in the 1st quarter of the 2010 marketing year as old crop corn was blended and used. Ethanol demand is projected to continue to exceed the Renewable Fuels Standard. That’s enough to push stocks-to-use to 5.0%, the lowest level since And push prices higher with USDA at the $5.40 level for an average 2010/11 price.
Source: USDA 2 2

3. Projected 2010 Season-Average Corn Price
As the crop got smaller and the demands got larger, projected stocks were reduced and prices headed north. Both the futures market and USDA have been north of $5 for corn for the last few months. With the latest report, we’ll likely see futures indicate season-average prices over $5.50.

4. Projected 2011 Season-Average Corn Price
The pressure’s on for 2011.

5. Timing of the Crop Source: USDA
La Nina and the dry conditions in Argentina are beginning to show in the USDA numbers for South America. USDA pulled their Argentina corn estimate down 6 percent from last month and the reports from Argentina suggest we’ll see further reductions in the future.
Source: USDA 5 5

6. La Niña Winter El Niño Neutral La Niña Source: NOAA
La Nina will shape the crop outlook for South America, with concerns about the possibility of drought in the major crop production regions. Those concerns are finally showing up in production estimates.
Source: NOAA 6 6

7. World Corn Production Source: USDA
La Nina and the dry conditions in Argentina are beginning to show in the USDA numbers for South America. USDA pulled their Argentina corn estimate down 6 percent from last month and the reports from Argentina suggest we’ll see further reductions in the future.
Source: USDA 7 7

8. World Corn Markets Source: USDA
La Nina and the dry conditions in Argentina are beginning to show in the USDA numbers for South America. USDA pulled their Argentina corn estimate down 6 percent from last month and the reports from Argentina suggest we’ll see further reductions in the future.
Source: USDA 8 8

9. Thank you for your time. Any questions. My web site: http://www. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: