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Which is Hotter? The Markets or Your Field

Which is Hotter? The Markets or Your Field. Farm Progress Show Boone, Iowa August 30, 2012 Chad Hart Associate 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. Prices.

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Which is Hotter? The Markets or Your Field

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  1. Which is Hotter? The Markets or Your Field Farm Progress Show Boone, Iowa August 30, 2012 Chad Hart Associate 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. Prices

  5. Crop Conditions Source: USDA-NASS

  6. Corn Harvested Acre Adjustments

  7. Projected Corn Yields

  8. Objective Corn Yield Data Source: USDA-NASS

  9. World Corn Production Source: USDA-WAOB

  10. World Soybean Production Source: USDA-WAOB

  11. 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

  12. 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: ISU Extension

  13. U.S. Meat Production & Prices Source: USDA-WAOB

  14. Corn Exports Source: USDA-FAS

  15. Soy Exports Source: USDA-FAS

  16. Corn Advance Export Sales Source: USDA-FAS

  17. Soy Advance Export Sales Source: USDA-FAS

  18. Corn Grind for Ethanol

  19. Ethanol Stocks Source: DOE-EIA

  20. U.S. Blended Gasoline Consumption 7.6 bil. gal. 7.4 bil. gal. Source: DOE-EIA, via USDA-ERS

  21. Projected 2012 Season-Average Corn Price Cost

  22. Projected 2012 Season-Average Soy Price Cost

  23. Iowa Corn Prices vs. Costs

  24. Iowa Soybean Prices vs. Costs

  25. Prices

  26. Current Corn Futures 7.54 6.15 5.58 Source: CME Group, 8/29/2012

  27. Current Soybean Futures 16.09 12.86 12.35 Source: CME Group, 8/29/2012

  28. Thoughts for 2012 and Beyond • Supply/demand concerns • We got some rain, too little, too late • Biofuel growth and energy demand, RFS? • Will supply be able to keep pace with demand? • Drought is pulling supply down • But high prices are diminishing demand • General economic conditions • Continued worldwide economic recovery is a key for crop prices • US job recovery, European financial concerns, China? • 2012/13: USDA: Corn $8.20; Soy $16.00 Futures (as of 8/29/12): Corn $7.54; Soy $16.09 • 2013/14: Futures Corn $6.15; Soy $12.86 • 2014/15: Futures Corn $5.58; Soy $12.35

  29. 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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