1. Extension and Outreach/Department of Economics Global Ag Commodity Markets agri benchmark Cash Crop Conference Des Moines, Iowa August 2014 Chad Hart Associate Professor/Crop Markets Specialist chart@iastate.edu 515-294-9911

2. Extension and Outreach/Department of Economics Long-term Agricultural Projections  Who does them? A lot of groups  USDA  FAPRI  OECD  Why do we have them? Lots of reasons  Producer planning  Industry planning  Government planning  Evaluation of markets and policies in anticipation of changes  Are they right? No  But are they useful? Yes  They tend to reveal the general trends, but not the sudden shifts

3. Extension and Outreach/Department of Economics Methodology  Historical Trend Analysis  Looking for general patterns  Some Econometric Modeling  Attempt to uphold economic theory  Some Expert Judgment  Attempt to get some guidance on the sudden shifts  Increasingly Stochastic in Nature  More issues relate to the tails of the distributions, as opposed to the means

4. Extension and Outreach/Department of Economics My Perspective  Currently, I’m the crop markets specialist for Iowa State University Extension  Previous jobs in the Center for Agricultural and Rural Development (CARD) and the Food and Agricultural Policy Research Institute (FAPRI)  Given my background, we’ll use the current FAPRI outlook to walk through a long-term projection for agriculture

5. Extension and Outreach/Department of Economics Models, Models, Models

6. Extension and Outreach/Department of Economics Starts with Macro

7. Extension and Outreach/Department of Economics … and Demographics

8. Extension and Outreach/Department of Economics Then We Get to Agriculture

9. Extension and Outreach/Department of Economics Oilseed Outlook

10. Extension and Outreach/Department of Economics Land Is Still Flowing into the System

11. Extension and Outreach/Department of Economics Productivity Continues to Build

12. Extension and Outreach/Department of Economics Government Policy Impacts Markets

13. Extension and Outreach/Department of Economics Alternative Uses Ebb and Flow

14. Extension and Outreach/Department of Economics Relate Back to Farm Income

15. Extension and Outreach/Department of Economics Through Both Revenues and Costs

16. Extension and Outreach/Department of Economics Corn Prices vs. Costs Sources: USDA-NASS for Prices, Duffy for Costs Per Bushel Cost calculated as Per Acre Cost from ISU Extension divided by Actual Yield per Acre

17. Extension and Outreach/Department of Economics 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/