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Grain Market Update

Grain Market Update. Crop Advantage Series Waterloo and Iowa City, Iowa Jan. 25-26, 2012 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911. U.S. Corn Supply and Use. Source: USDA-WAOB. U.S. Soybean Supply and Use. Source: USDA-WAOB. 2011 Corn Yields.

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Grain Market Update

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  1. Grain Market Update Crop Advantage Series Waterloo and Iowa City, Iowa Jan. 25-26, 2012 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911

  2. U.S. Corn Supply and Use Source: USDA-WAOB

  3. U.S. Soybean Supply and Use Source: USDA-WAOB

  4. 2011 Corn Yields Source: USDA-NASS

  5. 2011 Soybean Yields Source: USDA-NASS

  6. World Corn Production Source: USDA-WAOB

  7. World Soybean Production Source: USDA-WAOB

  8. South American Precipitation Source: USDA-NASS & WAOB

  9. Corn vs. Wheat Source: CME Group, 1/24/2012

  10. 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

  11. 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

  12. Corn Export Shifts Source: USDA-FAS

  13. Soy Export Shifts Source: USDA-FAS

  14. Change of Export Pace

  15. Renewable Fuels Standard (RFS)

  16. Corn Grind for Ethanol Source: DOE-EIA

  17. Ethanol Blending Advantage

  18. Projected 2011 Season-Average Corn Price

  19. Projected 2011 Season-Average Soy Price

  20. Projected 2012 Season-Average Corn Price

  21. Projected 2012 Season-Average Soy Price

  22. Iowa Corn Prices vs. Costs

  23. Iowa Soybean Prices vs. Costs

  24. Principal Crop Area Source: USDA-NASS

  25. States with Room to Grow Number is the difference in planted acres between 2008 and 2011

  26. Iowa Crop Margins

  27. Current Corn Futures 5.86 5.46 5.35 5.31 Source: CME Group, 1/10/2012

  28. Current Soybean Futures 11.72 11.62 11.50 11.51 Source: CME Group, 1/10/2012

  29. 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 • Supply/demand concerns • Smaller than anticipated U.S. crops, worries about dry conditions • Biofuel growth and energy demand • Corn has the upper hand in the acreage competition • Will supply be able to keep pace with demand? • 2011/12: USDA: Corn $6.20; Soy $11.70 • Futures (as of 1/24/12): Corn $5.86; Soy $11.62 • 2012/13: Futures (as of 1/24/12): Corn $5.46; Soy $11.72

  30. 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/

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