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Welcome

Welcome. Dr. J. Scott Angle Dean and Director The University of Georgia College of Agricultural and Environmental Sciences. Local Welcome. Mr. Jason Edenfield UGA Extension – Toombs County. Summary of the 2014 Georgia Agricultural & Agribusiness Outlook.

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Welcome

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  1. Welcome Dr. J. Scott Angle Dean and Director The University of Georgia College of Agricultural and Environmental Sciences

  2. Local Welcome Mr. Jason Edenfield UGA Extension – Toombs County

  3. Summary of the 2014 Georgia Agricultural & Agribusiness Outlook Dr. Nathan Smith & Dr. Curt Lacy Extension Economists, Department of Agricultural & Applied Economics The University of Georgia College of Agricultural and Environmental Sciences

  4. Georgia Row CropsSituation and Outlook for 2014 Nathan Smith, Don Shurley, and Amanda Smith Department of Agricultural and Applied Economics University of Georgia

  5. Row Crop Situation Heading into 2014 • Challenging production season with wetter than normal conditions and cooler temperatures into middle of the summer and then dry late season. • Supply outpacing demand in most crops. • Downtrending prices, especially since harvest.

  6. 2013 – Mixed Year For Yields * New Record set in 2013

  7. Corn Market Factors • Record 2013 production. • Leveling off of corn-starch ethanol industry. • Growing domestic use. • Increase in world production and use (South America shifting back to soybeans).

  8. U.S. Corn Supply and Demand Record high crop in 2013/14 Reversal of trend to, now increased stocks

  9. Change in Pattern for Corn Use? Ethanol use flattening out Feed use to rebound Million bushels

  10. Corn Price Outlook • South America shifting back to soybeans. • Exports, livestock feeding and size of U.S. and foreign corn crops will influence corn prices in the future. • Reduced U.S. acres 2 million or more. • Prices likely to range between $4.75 and $4. • Another 14 Mil. Bushel crop would push prices below $4.

  11. Soybean Market Factors Tight US supply situation. Global demand for soybeans and products growing. Bullish exports sales and shipments. Increase in South American production.

  12. U.S. Soybean Supply and Demand 2013 Reversal of down trend in production and use. Tighter supply situation due to increased exports.

  13. World Soybean Supply and UseMillion Metric Tons Source: Janauary 10, 2014 WASDE

  14. Soybean Price Outlook • Relatively tight US supply again, but World supply not as tight. • Crush about the same as last year. • Exports key for prices heading into 2014, China growth and positive crush returns indicate more soybean imports. • More acres in US and GA • Prices likely between $10 and $11 per bushel.

  15. Peanut Market Factors • Better crop than expected in 2013 leads to large carryover. • Exports down • Domestic Use up • Overall Use down

  16. Peanut Disappearance by Use

  17. Peanut Projections 2014/14

  18. Peanut Price Outlook • Early contracts offered for $425 per ton. • Some with $50 premium for High Oleic’s like Georgia 09B. • Peanut prices to be determined in part by cotton prices before planting. • Acreage expected to increase 10-15% • Prices likely to range between $425 and $475 per ton.

  19. Cotton Market Factors For 2014 • Record level of World Stocks • Slowly improving World demand • Acreage and production in 2014 • Chinese stocks policy and impact on demand for imports (US exports)

  20. 79.67

  21. Ending Stocks, China and Rest of the World (ROW) China has built massive stocks But, ROW has actually declined

  22. China An Increasing Unknown and Source of Instability • Two years of building stocks (why, impacts) • Imports cut by ½ this year • News that imports will decline further for 2014 • What will happen to large stocks/reserves? • China began to auction off stocks, mills did not want • News that some mills are closing, relocating elsewhere

  23. 2014 Price Outlook • US and World production likely to increase • Demand should continue to improve • Chinese imports (US exports) may decline significantly • Prices (Dec14 futures) likely to range between 75 and 85 cents. • High end of this range and rallies may depend on supply shocks

  24. 2014 Outlook • Most prices lower due to increase in production. • Demand increases on soybean side. • Corn use other than ethanol to pick up. • Soybeans may have most optimistic outlook • Fewer acres of corn and wheat in Ga and more acres of peanuts, soybeans. Cotton, stable to up. • Profit margins tighter.

  25. Georgia Major Row Crops Acres Planted*1,000 Acres * Tobacco is acres harvested. 2013 are authors projections except wheat.

  26. 2014 Net Returns ComparisonNon-Irrigated

  27. 2014 Net Returns ComparisonIrrigated

  28. THANK YOU.

  29. Animal Products and Timber Outlook Dr. Curt Lacy Extension Economist-Livestock

  30. Key Factors Impacting Livestock Markets and Profitability • Economy (consumer demand) • Crop prices • Feeder cattle demand • Sector profitability • Big picture items

  31. Livestock Marketing Information Center Data Source: Bureau of Economic Analysis

  32. Livestock Marketing Information Center Data Source: Bureau of Economic Analysis, Compiled & Analysis by LMIC

  33. Beef Cattle Situation & Outlook

  34. Data Source: USDA-AMS, Compiled by LMIC Livestock Marketing Information Center

  35. BEEF COWS THAT CALVEDJANUARY 1, 2013(1000 Head) U.S. Total: 29295 Livestock Marketing Information Center Data Source: USDA-NASS

  36. CHANGE IN BEEF COWS NUMBERSJANUARY 1, 2012 TO JANUARY 2013(1000 Head) U.S. Total: -862 Livestock Marketing Information Center Data Source: USDA-NASS

  37. CHANGE IN BEEF COWS NUMBERSJANUARY 1, 2003 TO JANUARY 2013(1000 Head) U.S. Total: -3236 Livestock Marketing Information Center Data Source: USDA-NASS

  38. Meat supplies were virtually unchanged for two years in a row Source: USDA-WASDE, January 2014 Report

  39. Past and Projected Prices Source: USDA, LMIC and UGA

  40. Projected Beef Cattle Profits in 2014 • Cow-calf • Stockers • Finishing Graphics source: CattleFax: Long-term Outlook. www.cattlefax.com

  41. Beef Cattle Summary • For 2013 expect lower production • Higher prices • Higher profits • More heifer retention

  42. Dairy situation and outlook

  43. What will drive prices in 2014? • Declining cow numbers • Strong demand for dairy exports • Favorable feed prices • Production abroad rebounds

  44. Georgia Milk Production Since 2000 During this time, milk production per cow increased from 16,500 to 19,200.

  45. Georgia Milk Mailbox Prices 2001-2014 (est.) 2014: $21.50 - $23.50

  46. Other Considerations • 2014 Farm Bill • Margin insurance • Tied to production controls?? • Still being debated in Congress

  47. Livestock Marketing Information Center Data Source: Iowa State University

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