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Crop Outlook for 2011

Crop Outlook for 2011. 2010 Integrated Crop Management Conference Ames, Iowa Dec. 2, 2010 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911. U.S. Corn Supply and Use. Source: USDA. Translates to a yield in the 170-175 bu. range.

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Crop Outlook for 2011

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  1. Crop Outlook for 2011 2010 Integrated Crop Management Conference Ames, Iowa Dec. 2, 2010 Chad Hart Assistant Professor/Grain Markets Specialist chart@iastate.edu 515-294-9911

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

  3. Translates to a yield in the 170-175 bu. range Translates to a yield around 160 bu. Source: USDA-NASS

  4. U.S. Soybean Supply and Use Source: USDA

  5. Within a bushel of each other Source: USDA-NASS

  6. World Corn Production Source: USDA

  7. World Soybean Production Source: USDA

  8. Clearing Old Stocks The current stocks set-up is reminiscent of the transition between the 2006 and 2007 crops. Source: USDA

  9. Livestock Situation Poultry production 46% of total red meat and poultry Year-to-date 2010 Broilers +3.6%, Turkey -4.4% 7-weeks: Chick placement +3.4% / Egg set +5.4% Forecast for 2011 & 2012 (yr/yr % change) Production Consumption Broilers +2.5 & +3.1 +1.5 & +2.0 Turkeys +3.0 & +4.5 -1.3 & +6.1 Source: John Lawrence, ISU Extension

  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 Sales Source: USDA, FAS

  13. 2010 U.S. Corn Exports Source: USDA, FAS

  14. Corn Export Shifts Source: USDA, FAS

  15. Soybean Export Sales Source: USDA, FAS

  16. 2010 U.S. Soybean Exports Source: USDA, FAS

  17. Soy Export Shifts Source: USDA, FAS

  18. Renewable Fuels Standard (RFS)

  19. Ethanol Margins Source: ISU, CARD

  20. Ethanol Margins Source: ISU, CARD

  21. Crude Oil Prices Sources: EIA, NYMEX

  22. Ethanol Blending Advantage

  23. Fuel Prices

  24. Gasoline Consumption Source: EIA, Annual Energy Outlook

  25. Projected 2010 Season-Average Corn Price

  26. Projected 2010 Season-Average Soy Price

  27. Corn

  28. Soybeans

  29. Corn Futures Trade Source: CFTC

  30. Iowa Corn Prices vs. Costs Even with the recent knock, futures have prices in the $5 range Even with higher fertilizer costs, corn’s profitable

  31. Iowa Soybean Prices vs. Costs Futures have season-average prices above $11 for ’10 and ‘11

  32. Principal Crop Area Source: USDA-NASS

  33. States with Room to Grow

  34. New Crop Futures Price Movements

  35. Thoughts for 2011 and Beyond • General economic conditions • Continued economic recovery is a major key for crop prices • Fears of Chinese inflation and credit tightening have hit the markets • Long-term oil price remain in the $90 range • Supply/demand concerns • South America: La Niña impacts • Biofuels: E10, E12, or E15; Do the tax credits get extended/renewed? • Will supply be able to keep pace with demand? • 2010/11: USDA: Corn $5.20, Soy $11.45 Futures (as of 12/1/2010): Corn $5.06, Soy $11.63 • 2011/12: Futures (as of 12/1/2010): Corn $5.11, Soy $11.60

  36. Thank you for your time!Any questions?My web site:http://www.econ.iastate.edu/~chart/Iowa Farm Outlook:http://www.econ.iastate.edu/outreach/agriculture/periodicals/ifo/Ag Decision Maker:http://www.extension.iastate.edu/agdm/

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