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Wheat and Feed Grain Market Outlook and Situation

Wheat and Feed Grain Market Outlook and Situation. Southern Extension Outlook Conference Tunica, Mississippi September 24, 2002. Kurt M. Guidry LSU Agricultural Center. Current Market Situation. Significantly Improved Markets From Last 3 Years. Supply Driven Rally.

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Wheat and Feed Grain Market Outlook and Situation

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  1. Wheat and Feed Grain Market Outlook and Situation Southern Extension Outlook Conference Tunica, Mississippi September 24, 2002 Kurt M. Guidry LSU Agricultural Center

  2. Current Market Situation • Significantly Improved Markets From Last 3 Years • Supply Driven Rally • Improved Fundamentals Increase Market Sensitivity • Since June, Futures Prices Have Increased • Wheat Futures Moved Over $1.00 Per Bushel Higher • Corn Futures Moved Over $0.70 Per Bushel Higher

  3. Where Will Prices Go ? • Prices Have Softened With Harvest Pressure And • Likelihood Of Increased Acres For Wheat • Demand Will Likely Play Big Role In Continued Price Movement • Increased Prices Will Likely Bring More Acreage Into Production • Improved Supply and Demand Fundamentals Should Provide • Support

  4. U.S. Corn Supply and Use (Domestic Measure) 2001/02 2001/02 ------------------ 2002/03------------- 2002/03 ------ (Sept. - Aug.) Item Estimate August September (Sept. - Aug.) Million Acres Change Million Acres Million Acres Change Area Planted 75.8 0.00 78.8 78.8 0.00 Harvested 68.8 0.00 71.0 70.5 -0.50 Bushels Bushels Bushels Yield per harvested acre 138.2 0.00 125.2 125.4 0.20 Million Bushels Million Bushels Million Bushels Beginning stocks 1,899 0.00 1,636 1,636 0.00 Production 9,507 0.00 8,886 8,849 -37.00 Imports 10 0.00 15 15 0.00 Supply, total 11,416 0.00 10,537 10,499 -38.00 Feed and residual 5,825 0.00 5,600 5,600 0.00 Food, seed, & industrial 2,055 0.00 2,170 2,170 0.00 Domestic, total 7,880 0.00 7,770 7,770 0.00 Exports 1,900 0.00 2,000 2,000 0.00 Use, total 9,780 0.00 9,770 9,770 0.00 Ending Stocks 1,636 0.00 767 729 -38.00 Stocks To Use 16.73% 7.85% 7.46% Avg. Farm Price ($/bu) 1.97 2.30 - 2.70 2.35 - 2.75 Source: USDA, World Agricultural Supply and Demand Report, September 12, 2002.

  5. Source: DTN AgDayta

  6. Source: DTN AgDayta

  7. Source: USDA, World Agricultural Supply and Demand Report, September 12, 2002

  8. Source: DTN AgDayta

  9. Source: DTN AgDayta

  10. Source: DTN AgDayta

  11. Source: DTN AgDayta

  12. Source: DTN AgDayta

  13. Conclusions • Despite Improved Fundamentals, Increased Acres And A • Return To More Typical Yields Will Place Pressure On Price • Improved Fundamentals Likely Will Cause More Sensitivity • To Production Difficulties And/Or Improved Demand • Potential For Increased Production Provides Incentive To • Consider Current Prices For Expected 2003 Production

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