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General Sessions
degrees in Agricultural
Economics from the University of Nebraska-Lincoln … transportation issues, and c)
economic analysis of irrigated and …
Breakout Sessions
1980) degrees in Agricultural Economics from the University of
Nebraska-Lincoln … transportation issues, and c)
economic analysis of irrigated and …
November 12, 2015
2015 Crop Insurance Workshop Presentations
11/3/2015
Grain Market Price Behavior
Economic principles shown in market … prices & profits lead to economic responses that eventually …
provisions to help them during the economic disruptions – the PPP and … fuels.• The American Samoa economic development credit (P.L …
May 2, 2022
Recent Videos, Risk and Profit Online Mini-Conference Presentations
pdates)
Antonina BroyakaPhD in Economics, Associate Professor
As a result of hostilities in Ukraine, an area of 82 …
September 20, 2023
Recent Videos, Risk and Profit Online Mini-Conference Presentations
kaExtension Associate of Agricultural Economics Department,Kansas State Un … nsas State University
PhD in Economics, Associate Professor from Ukraine
OUTLINE:
• …
January 1, 2011
Land Leasing
Forms
agreement that
achieves maximum economic returns to all
resources … rates
from time to time when economic conditions
change, either …
February 12, 2025
2018 Farm Bill, Recent Videos
April 25, 2016
Grain Market Outlook
U.S. corn crop – leading to reduced corn acreage and production prospects. Low corn
prices and limited corn net returns prospects may reduce U.S. 2016 corn acreage and production prospects.
Market factors such as a) economic and financial system disruptions impacting grain, energy, and other
commodity markets, b) U.S. farmer resistance to selling at low late‐April and May 2016 cash corn prices, and c)
concerns about possible “El Nino” or “El Nino‐La Nina transition”‐ related weather patterns in spring‐summer
2016 with an eye toward their possible negative impacts on 2016 crop production, could each still impact corn
market prices through summer‐fall 2016. Also, low feedgrain prices have resulted in lower input costs for U.S.
and Foreign livestock feeding and bioenergy users – leading to strong domestic and foreign feedgrain usage
and providing underlying support for U.S. corn exports. In the “current” 2015/16 marketing year the high
value of the U.S. dollar and prospects for a large 2016 South American corn crop have been significant limiting
factors for U.S. corn exports – although the U.S. dollar has been trending lower in recent weeks.
USDA Estimate for “Current” MY 2015/16: The USDA made several changes to the U.S. corn supply‐demand
balance sheet for “current crop” MY 2015/16 – with 2015 U.S. corn production of 13.601 bb, and total supplies
of 15.382 bb for MY 2015/16. Total use is projected to be 13.521 bb (down 24 million bushels or ‘mb’) Ethanol
use was projected to be 5.250 bb (up 25 mb), with non‐ethanol Food, Seed, and Industrial (FSI) use of 1.371 bb
(up 1 mb), exports of 1.650 bb, and feed and residual use of 5.250 bb (down 25 mb). Ending stocks are
forecast to be up 25 mb to 1.862 bb (13.77% S/U) in “current” MY 2015/16 – up from 1.731 bb (12.6% S/U) in
“old crop” MY 2014/15, and 1.232 bb (9.2% S/U) in MY 2013/14. U.S. corn average cash prices are forecast to
be in the range of $3.40‐$3.70 /bu. ($3.55 midpoint) versus $3.70 in “old crop” MY 2014/15, $4.46 in MY
2013/14, and $6.89 (record high) in MY 2012/13.
Adjusted USDA Forecast for “Next Crop” MY 2016/17: An adjusted version of the USDA’s “next crop” MY
2016/17 forecast for U.S. corn is presented here, building on the information presented by the USDA at its
Agricultural Outlook Forum in Arlington, VA on February 25‐26, with 2015 U.S. corn planted acres matching
the higher March 31st Prospective Planting report planted acreage forecast. Projected 2016 U.S. corn
plantings equal 93.601 ma – up 5.602 ma from 2015. Forecast 2016 harvested acres of 85.413 ma would be up
4.664 ma vs 2015. With projected yields of 168.0 bu/ac, 2016 U.S. corn production is projected to be a record
14.349 billion bushels (bb) – up from 13.829 bb in 2013, 14.216 bb in 2014, and 13.601 bb in 2015. With
forecast MY 2016/17 total use of 13.725 bb (2nd highest behind 13.748 bb in “old crop” MY 2014/15), and
projected ending stocks of 2.486 bb (18.11% S/U) – up from 1.862 bb (13.77% S/U) in “current crop” MY
2015/16, U.S. corn prices are projected by the USDA to be $3.45 /bu – down from the $3.55 /bu midpoint
estimate for “current” MY 2015/16 and subject to lowering in future USDA WASDE reports. This scenario is
given a 35% likelihood of occurring by KSU.
Page | 2
KSU Forecast for “Next Crop” MY 2016/17: Three alternative KSU‐Scenarios for U.S. corn supply‐demand and
prices are presented for “next crop” MY 2016/17, with each assuming a 1.5 ma downward adjustment in 2016
U.S. corn planted acres from the USDA’s March 31st Prospective Plantings report. A) KSU‐Scenario A (Lower
Acres & Trend Yield) (30% probability) assumes for “next crop” MY 2016/17: 92.101 ma planted, 84.404 ma
harvested, 164.5 bu/ac yield, 13.825 bb production, 15.727 bb total supplies, 13.640 bb total use, 2.087 bb
ending stocks, 15.30% S/U, & $3.20 /bu U.S. corn average price; B) KSU‐Scenario B (Lower Acres & Moderate
Drought) (25% prob.) assumes 92.101 ma planted, 84.404 ma harvested, 158.0 bu/ac yield, 13.279 bb
production, 15.186 bb total supplies, 13.575 bb total use, 1.611 bb ending stocks, 11.87% S/U, & $3.70 /bu U.S.
corn price; and C) KSU‐Scenario C (Lower Acres & Extreme Drought) (10% prob.) assumes 92.101 ma planted,
84.404 ma harvested, 150.0 bu/ac yield, 12.607 bb production, 14.519 bb total supplies, 13.382 bb total use,
1.137 bb ending stocks, 8.5% S/U, & $4.75 /bu U.S. corn price.
World Corn Supply‐Demand: World total supplies of 1,179.7 million metric tons (mmt) are projected for
“current” MY 2015/16, down from 1,187.9 mmt in “old crop” MY 2014/15, but up from 1,123.9 mmt in MY
2013/14. Projected World corn ending stocks of 208.9 mmt (21.5% S/U) in “current” MY 2015/16 are up from
207.6 mmt (21.2% S/U) in “old crop” MY 2014/15, and from 175.0 mmt (18.4% S/U) in MY 2013/14.
…
September 21, 2015
Grain Market Outlook
al wheat production
problems and supply prospects in Australia, India, Russia, and elsewhere, b) ongoing geopolitical problems in
the Black Sea region and Middle East, and c) uncertainty in World economic, financial and currency markets.
Even so, the “large crop‐over supply” situation existing in World & U.S. wheat markets continues to negatively
influence wheat market price prospects. For wheat prices to recover in late 2015‐2016 it is likely that a
significant World wheat production problem and/or trade disruption would need to occur. In the United
States the ongoing strength of the U.S. dollar is an important negative factor for U.S. wheat exports and price
prospects. The USDA 2015 Small Grains Summary and Grain Stocks reports to be released on September 30th
will provide the next set of U.S. wheat production and usage data to consider for wheat markets.
USDA U.S. Wheat Supply‐Demand & Price Forecast: For U.S. wheat in the “new crop” 2015/16 marketing
year, the USDA maintained its projection that there would be 55.079 million acres (ma) planted, 48.454 ma
harvested, 44.1 bu/ac yields, 2.136 billion bushels (bb) production, and 3.014 bb total supplies, and 200 mb
feed & residual use. However, the USDA lowered its forecast of U.S. exports to 900 million bushel (mb) (down
25 mb) – dropping total use to 2.139 mb (down 25 mb), raising ending stocks to 875 mb (up 25 mb), raising
ending‐stocks‐to‐use to 40.9% (up from 39.3% in August and 38.5% in July, up to the highest level since 48.6%
in MY 2009/08). The USDA lowered is projection of U.S. average wheat prices for “new crop” MY 2015/16 to
the range of $4.65‐$5.55 /bu. (midpoint =$5.00) – the lowest since $4.87 /bu in MY 2009/10.
KSU U.S. Wheat Supply‐Demand & Price Forecast: Kansas State University projections of “new crop” MY
2015/16 supply‐demand balances and prices are represented in two scenarios: A) “Lower Exports” Scenario:
70% prob. of the same U.S. wheat production estimates as the USDA, but with U.S. exports dropping to “old
crop” 2014/15 levels, i.e., 850 mb exports, 925 mb ending stocks, 44.3% S/U, and $4.75 /bu U.S. average price.
B) “Higher Exports” Scenario: 30% prob. of production prospects equal to the USDA’s but with higher U.S.
wheat exports, i.e., 1.000 bb exports, 790 mb ending stocks, 35.2% S/U, and $5.75 /bu U.S. average price.
USDA World Wheat: The expectation of large World wheat supplies and stocks are a “burden” on World
wheat markets – driving prices lower. Record World total wheat supplies of 942.9 mmt in “new crop” MY
2015/16 are up from the previous record of 918.8 mmt in “old crop” MY 2014/15, and from 892.2 mmt in MY
2013/14. Projected record World wheat ending stocks in “new crop” MY 2015/16 of 226.6 mmt (31.6% S/U)
are also record high, and up from 211.3 mmt (29.9% S/U) in “old crop” MY 2014/15, and from 193.6 mmt
(27.7% S/U) in MY 2013/14. For perspective, these supply‐demand figures can be compared to the historic
minimum World wheat ending stocks of 128.8 mmt and stocks‐to‐use of 21.0% S/U in MY 2007/08.
Page | 2
I. U.S. Wheat Market Situation & Outlook
I‐A. September 11th USDA Reports & “New Crop” MY 2015/16 Projections
On September 11th the USDA World Agricultural Outlook Board (WAOB) released its September 2015
World Agricultural Supply and Demand Estimates (WASDE) report – containing U.S. and World wheat supply‐
demand and price projections for the 2013/14, “old crop” 2014/15, as well as the “new crop” 2015/16
marketing years. The “new crop” 2015/16 marketing year for U.S. wheat began on June 1, 2015 and will last
through May 31, 2016.
On September 30th the USDA National Agricultural Statistical Service (NASS) will release its 2015 Small
Grains Summary and Grain Stocks reports, both of which could impact U.S. wheat supply‐demand estimates
and possibly wheat prices. Of particular importance in the Small Grains Summary report will be the final
estimate of 2015 U.S. wheat acreage, yield, and production. The particular focus of wheat markets will be on
production of U.S. durum and spring wheat crops in the northern states, and the U.S. winter wheat crop in the
Pacific Northwest.
I‐B. CME Kansas Hard Red Winter Wheat Futures & U.S. Dollar Index
Since market highs of $6.28 ¾ per bushel for the CME DECEMBER 2015 Kansas hard red winter wheat
futures contract occurred on June 30, 2015, December futures have trended sharply lower – down to a low of
$4.65 ¾ on September 4, 2015 (Figure 1). The slow pace of U.S. wheat exports caused by record large World
wheat production prospects in “new crop” MY 2015/16 and the historically high value of the U.S. dollar have
been key factors causing the recent sharp decline in CME DECEMBER 2015 Kansas HRW wheat prices.
Figure 1. DECEMBER 2015 & JULY 2016 CME Kansas Wheat Futures Price Charts …