Search
Displaying 361 - 370 of 5865
October 13, 2014
Commodity Program Papers
crop insurance if they meet conservation requirements. The OSU-
KSU …
January 1, 2011
Land Leasing
Forms
improvements, including conservation
practices, are a contribution …
June 20, 2016
Financial Management
3
chemical costs and farms that use traditional tillage practices will have higher fuel costs. If one method controls
weeds at a lower aggregate cost (also including labor, repair, and depreciation expenses), farms that utilize this
method will achieve a higher level of profitability. As another example, farms that own their land instead of
renting it may make more valuable long run investments (e.g., apply lime, do conservation work) in their land,
while farms that rent land may choose not to make improvements due to the risk of losing the land in the
future. Farms that own their land might achieve a higher level of performance as a result of being in a position
to make more profitable decisions.
Variables
Farms are broken down by their characteristics, production practices, and management focus. Table 1
list these three categories along with specific variables considered in each category. A farm’s characteristics
include their size, how they access land and equipment, and how many acres farmed per worker. Whether farms
own or rent land is quantified by their share of rented acres. The purpose of the value of equipment per acre
variable is to quantify a farms decision to own equipment or hire custom operators. It also implicitly measures a
farms use of older or new equipment. The number of workers on the farm is measured by the total number of
operators, family laborers, and hired employees per acre.
Farm production practices include the diversity of crops grown, how intensely land is used, and farm
tillage practices. The diversification of crops grown is measured by a Herfindahl index of crop acres planted. How
intensely a farm uses their land is measured by planted dryland acres divided by total dryland acres, where
values less than 1.0 indicate some land being fallowed and a value greater than 1.0 indicates double cropping. A
farm’s use of traditional tillage or no tillage practices is estimated by the ratio of a farm’s chemical costs to their
total chemical and equipment costs. A higher ratio is assumed to be correlated with reduced or no‐tillage
production.
Kansas State University Department Of Agricultural Economics Extension Publication …
March 9, 2011
Energy
Plains Underground
Water Conservation District No. 1 with
technical …
January 11, 2021
Marketing Strategies
give you a maximum fee and a conservative estimate on the price
floor …
May 2, 2022
Recent Videos, Risk and Profit Online Mini-Conference Presentations
January 30, 2024
Land Buying and Valuing
including eminent domain, conservation ease-
ments, as well as appraising … programs to land use and conservation practices.
MAXIMIZE RETURNS … programs to land use and conservation practices.
MAXIMIZE RETURNS …
August 31, 2012
Risk Management Strategies
February 18, 2015
Grain Market Outlook
I‐C. U.S. Corn Supply‐Demand – USDA “Current Crop” 2014/15 Projections
U.S. Corn Acreage, Yield & Production
The USDA made no change from the January WASDE report in its projection that 2014 U.S. corn total
planted acreage was 90.597 million acres (ma), which had been adjusted down from 90.885 ma in the
December WASDE report (Table 1 and Figure 2). Planted acreage of 90.597 million acres in 2014 is down from
95.365 ma in 2013, 97.291 ma in 2012, and 91.921 ma in 2011.
In addition, the USDA made no change in its January projection of 2014 U.S. corn harvested acreage of
83.136 ma, which had been adjusted upwards from 83.097 ma in December. Harvested acreage of 83.136 ma
in 2014 is down from 87.451 ma in 2013, 87.365 ma in 2012, and 83.981 ma in 2011.
The 2014 proportion of harvested‐to‐planted acreage for all U.S. corn is projected to be 91.8% ‐ which had
been adjusted up from 91.4% in December. This proportion of harvested acreage in 2014 of 91.8% is up
marginally from 91.7% in to 2013, and up from 89.9% in 2012, and 91.4% in 2011.
The projected 2014 U.S. average corn yield of 171.0 bushels per acre (bu/ac) is a record high and
unchanged from the January USDA reports, but is down from earlier USDA projections of 173.4 bu/ac in
December and 174.2 bu/ac in October 2014 (Table 1 and Figure 3). This projection of 171.0 bu/ac in January‐
February is up from 158.8 bu/ac in 2013, the drought affected 2012 low yield of 123.1 bu/ac., and up from the
previous record high of 164.7 bu/ac in 2009.
DEC 2015 CME eCorn Futures
June 20, 2014 – Feb. 17, 2015
Close = $4.20 ½ on 2/17/2015
MAR 2015 CME eCorn Futures
June 20, 2014 – Feb. 17, 2015
Close = $3.89 ½ on 2/17/2015
Page | 4
Based on these 2014 acreage and yield projections, the USDA maintained is January projection that 2014
U.S. corn production to be a record high 14.216 billion bushels (bb) – down from 14.407 bb in the December
USDA reports. The projection of a record high 14.216 bb is up from the previous record high of 13.925 bb in
2013, 10.755 bb in 2012, 12.360 bb in 2011, 12.447 bb in 2010, and 13.092 bb in 2009 (Table 1).
U.S. Corn Total Supplies
The USDA projects that total supplies of U.S. corn for “current crop” MY 2014/15 are a record high 15.472
bb – resulting from beginning stocks of 1.232 bb, projected 2014 production of 14.216 bb, and projected
imports of 25 million bushel (mb) (Table 1 and Figure 4). Total supplies of 15.472 bb in “current crop” MY
2014/15 are comparable to recent year’s amounts of 14.362 bb in MY 2007/08, 13.729 bb in MY 2008/09,
14.774 bb in MY 2009/10 (3rd largest), 14.182 bb in MY 2010/11 (4th largest), 13.517 bb in MY 2011/12, 11.904
bb in “short crop” MY 2012/13, and 14.686 bb in MY 2013/14 (2nd highest).
Beginning stocks of 1.232 bb in “current crop” MY 2014/15 are down marginally (‐ 4 mb) from October‐
December USDA WASDE reports. The total of 1.232 bb in beginning stocks in “current crop” MY 2014/15 is up
from 821 mb in MY 2013/14, 989 mb in MY 2012/13, and 1.128 bb in MY 2011/12, but less than 1.708 bb in
MY 2010/11, 1.673 bb in MY 2009/10, and 1.624 bb in MY 2008/09. This amount of beginning stocks in
“current crop” MY 2014/15 of 1.232 bb is up considerably from the low of 426 mb that occurred in MY
1996/97 (Table 1 and Figure 4).
Imports of 25 mb in “current crop” MY 2014/15 are projected to be down from 36 mb in MY 2013/14 (the
2nd highest), and are also down sharply from the record high of 160 mb in the drought‐stressed 2012/13
marketing year. These amounts of U.S. corn imports are comparable to 29 mb in MY 2011/12, and 28 mb in
MY 2010/11.
U.S. Corn Use by Category & Total Use
U.S. Ethanol Production and Corn Usage: Projected U.S. corn use for ethanol production of 5.250 bb in
“current crop” MY 2014/15 is up from 5.175 bb in January and from 5.150 bb in the December WASDE report –
due to a) low corn input prices, b) at least moderate strength in distillers grains co‐product prices, and c)
increased projections of 2015 U.S. gasoline consumption released in recent weeks (Table 1 and Figures 5‐6).
This projection of 5.250 bb in “current crop” MY 2014/15 is up from 5.134 bb in MY 2013/14, 4.641 bb in MY
2012/13, and 5.000 bb in MY 2011/12.
Figure 6 shows weekly U.S. oxygenated plant production of fuel ethanol as reported by the U.S. Energy
Information Administration (www.eia.gov) with a calculated estimate of corn use developed by Kansas State
University. Assuming 2.75 gallons of ethanol produced per bushel of corn, these calculations indicate that the
equivalent projected annual rate of U.S. corn used for ethanol production for “current crop” MY 2014/15 has
ranged from 4.911‐5.530 bb on a weekly basis since early September 2014 ‐ the beginning of the “current
crop” 2014/15 marketing year. Over the period of from September 1, 2014 through February 6, 2015, corn
usage for ethanol production was been on pace to reach 5.277 bb in “current crop” MY 2014/15. This
estimate of 5.277 bb is 27 mb more than the USDA’s February 2015 WASDE report estimate of 5.250 bb of
corn to be used for ethanol production during “current crop” MY 2014/15, with 23 of 52 weeks (44.2%) of the
marketing year completed.
U.S. Corn Use as Distillers Grains: An estimate of the U.S. corn equivalent amounts of distillers grains
(DDGS) use for direct livestock feeding and exports is provided in Figure 7 – which shows estimated a) DDGS
Page | 5
corn equivalent U.S. domestic livestock feeding, and b) DDGS exports as well as other categories of U.S. corn
usage since MY 1989/90.
This analysis assumes 16.00 pounds of distillers dried grains and solubles (DDGS) per 56 pound bushel of
corn used in ethanol production – following from recent ethanol industry surveys. By these estimates, since
MY 2010/11 approximately 1.049‐1.130 bb of U.S. corn equivalent bushel‐weights of DDGS are projected
either to have already been or are to be fed to U.S. livestock during each marketing year – i.e., 1.108 bb in
DDGS corn‐weight equivalents in MY 2010/11, 1.130 bb in MY 2011/12, 1.004 bb in MY 2012/13, 993 mb
projected for MY 2013/14, and a projection of 1.016 bb in “current crop” MY 2014/15. Over the same five
most recent marketing years, DDGS exports in corn equivalent weights are estimated to range from 299 to 484
mb, – i.e., 326 mb in DDGS corn‐weight equivalents in MY 2010/11, 299 mb in MY 2011/12, 322 mb in MY
2012/13, 473 mb estimated for MY 2013/14, and a projection of a record high 484 mb in “current crop” MY
2014/15.
U.S. Corn Exports: Projected U.S. corn exports of 1.750 in “current crop” MY 2014/15 are down from the
estimate of 1.917 bb in MY 2013/14, but are up sharply from 730 mb in MY 2012/13 – the 40 year low since
MY 1975/76 (Table 1, Figures 5 and 7). According to the USDA Foreign Agricultural Service (FAS) weekly
export data (http://apps.fas.usda.gov/export‐sales/esrd1.html), as of February 5th, through the 23rd week of “current crop”
MY 2014/15 (23 of 52 weeks), 627.6 mb of U.S. corn had been physically shipped for export – equal to 35.9%
of the USDA’s updated projection for “current crop” MY 2014/15 of 1.750 bb. An additional 677.5 mb of U.S.
corn had been pre‐sold for future export shipments during the “current crop” 2014/15 marketing year – prior
to August 31, 2015 (the end of “current crop” MY 2014/15).
Adding together 627.6 mb in past shipments plus 677.5 mb in forward sales amounts to 1,305.1 mb, or
74.6% of the USDA’s 1.750 bb U.S. corn export target for “current crop” MY 2014/15 in the February 10th
USDA WASDE report with 44.2% (23/52 weeks) of the marketing year completed. United States’ corn exports
will need to average 38.7 mb per week for the remainder of the “current crop” 2014/15 marketing year to
achieve the USDA’s 1.750 bb projection. This compares to 28.1 mb and 24.4 mb of export shipments for the
weeks ending January 29th and February 5th, respectively – behind the pace needed to meet the USDA’s export
projection.
Non‐Ethanol FSI: Forecast non‐ethanol food, seed and industrial (FSI) use of 1.395 bb in “current crop”
MY 2014/15 is greater than 1.367 bb in MY 2013/14, and compares to 1.397 bb in MY 2012/13, and 1.428 bb
in MY 2011/12 (Table 1, Figures 5 and 7).
Feed and Residual Use: Forecast U.S. feed and residual use of 5.250 bb in “current crop” MY 2014/15 is
down 25 mb from January, and down 125 mb from the December WASDE (Table 1, Figures 5 and 7). This
projection of 5.250 bb in “current crop” MY 2014/15 is up from 5.036 bb for MY 2013/14, 4.315 bb in MY
2012/13, and 5.000 bb in MY 2011/12. These levels of corn use for livestock feeding are somewhat correlated
with the amounts of energy feeds per grain consuming animal units reported by the USDA over the same time
period as shown in what follows.
In the USDA February 13th Feed Outlook Report (http://usda.mannlib.cornell.edu/usda/current/FDS/FDS‐02‐13‐2015.pdf) the
USDA Economic Research Service (ERS) indicates that over the MY 2012/13 through “current crop” MY
2014/15 time period, the total amount of Energy Feeds in the U.S. – including corn, sorghum, barley, oats and
wheat – was estimated to be 125.9 million metric tons (mmt) in MY 2012/13 (87.1% corn), and 134.5 mmt in
MY 2013/14 (95.1% corn), and is projected to be 142.8 mmt in “current crop” MY 2014/15 (93.4% corn). Over
this same three year period, total U.S. Grain Consuming Animal Units were estimated to be 92.3 million in MY
Page | 6
2012/13, and 90.9 million in “current” MY 2013/14, and are projected to be 92.8 million in “current crop” MY
2014/15.
As a result, U.S. Energy Feeds per Grain Consuming Animal Unit is estimated to be 1.364 metric tons per
animal unit (mt/au) in MY 2012/13, and 1.477 mt/au in MY 2013/14, and is projected to be 1.539 mt/au in
“current crop” MY 2014/15. As the availability of feed grain and other energy feeds has increased or is
expected to increase from the drought stricken “short crop” year of MY 2012/13 to the “record large crop” MY
2013/14, and now into the new record large “current crop” MY 2014/15 for corn and other aggregated
feedgrains, the amount of energy feeds fed per animal unit and total feed use of U.S. corn has increased –
helping to bring downward pressure on corn and other feedgrain prices.
Total Use of U.S. Corn for “current crop” MY 2014/15 is projected to be a record high 13.645 bb – up 50
mb from January, but down 25 mb from the December USDA WASDE report. This amount is up from the
previous record high of 13.454 bb in MY 2013/14, and up sharply from 11.083 bb in drought‐affected MY
2012/13 (Table 1 and Figures 5 & 7). United States’ total corn use has varied widely in recent marketing years
due mainly to changes in available U.S. corn supplies, trending from 12.737 bb in MY 2007/08, 12.056 bb in MY
2008/09, 13.066 bb in MY 2009/10, 13.055 bb in MY 2010/11, 12.528 bb in MY 2011/12, 11.083 bb in MY
2012/13, the previous record high of 13.454 bb in MY 2013/14, and the projected new record high amount of
13.645 bb in “current crop” MY 2014/15.
U.S. Corn Ending Stocks, % Ending Stocks‐to‐Use, & Prices
U.S. corn ending stocks for “current crop” MY 2014/15 are projected to be 1.827 bb – down 50 mb from
January and down 171 mb from the December WASDE report (Table 1 & Figure 4). Since MY 2006/07 (1.304
bb), U.S. corn ending stocks have been 1.624 bb in MY 2007/08, 1.673 bb in MY 2008/09, 1.708 bb in MY
2009/10, 1.128 bb in MY 2010/11, 989 mb in MY 2011/12, 821 mb in “drought stricken” MY 2012/13, 1.232 bb
in MY 2013/14, and are now projected to be 1.827 bb in “current crop” MY 2014/15.
Projected percent (%) ending stocks‐to‐use of 13.39% in “current crop” MY 2014/15 has been trending
lower since fall, being down from 13.81% in January, 14.62% in December, 14.70% in November, and from
15.3% in the October WASDE report (Table 1 and Figures 8‐9). On a year‐by‐year basis, U.S. corn % ending
stocks‐to‐use trended downward from 12.8% in MY 2007/08 and 13.9% in MY 2008/09, to 13.1% in MY
2009/10, 8.6% in MY 2010/11, 7.9% in MY 2011/12, and then down to 7.4% in “drought stricken” MY 2012/13,
before increasing for the first time in six (6) years to 9.2% in MY 2013/14, and now to a projected level of
13.4% in “current crop” MY 2014/15.
U.S. average corn prices for “current crop” MY 2014/15 are projected to be in the range of $3.40‐$3.90
bu/ac (midpoint = $3.65) (Table 1 & Figures 8‐9). This price range is narrower by $0.05 /bu on each end of the
range from January, but up from a forecast range of $3.20‐$3.80 (midpoint = $3.50) in the December WASDE
report.
Since the beginning of the rapid expansion in U.S. ethanol production in 2006, U.S. corn prices have moved
higher, then lower, and higher again, changing from $3.04 /bu in MY 2006/07, to $4.20 in MY 2007/08, $4.06
in MY 2008/09, $3.55 in MY 2009/10, $5.18 in MY 2010/11, $6.22 in MY 2011/12, and then up to the record
high of $6.89 in “drought stricken” MY 2012/13. However, if the February 10th WASDE report projection holds
true, prices will now have declined for two consecutive years since the $6.89 record high in MY 2012/13, down
to $4.46 in MY 2013/14, and again down to $3.40‐$3.90 (midpoint = $3.65) in “current crop” MY 2014/15.
Page | 7
I‐D. KSU Corn Market Scenarios: MY 2014/15 & “Next Crop” MY 2015/16
Kansas State University Extension forecasts of U.S. corn supply‐demand balances and prices for the
“current crop” 2014/15 and “next crop” 2015/16 marketing years are provided below. Given the market
information available in mid‐February, the conservative price projections that follow seem reasonable –
especially for the current marketing year, i.e., “current crop” MY 2014/15. There is the possibility that the
USDA is overly pessimistic in its projections of U.S. corn usage in the “current crop” 2014/15 marketing year –
which would ultimately lead to lower U.S. corn supply‐demand balances, and at least marginally higher prices
than are currently being projected for the current marketing year.
A. KSU “Current Crop” MY 2014/15 U.S. Corn Supply‐Demand & Price Projection
These KSU supply‐demand and price projections for “current crop” MY 2014/15 reflect the possibility of
U.S. corn usage being underestimated by the USDA in the current marketing year. KSU projections of 2015
U.S. corn planted and harvested acreage are found in Table 1 and Figure 2. Projections of 2015 probability‐
weighted U.S. corn yields are found in Table 1 and Figure 3. Probability‐weighted KSU forecasts of U.S. corn
average prices for “current crop” MY 2014/15 are based on projections of U.S. corn % ending stocks‐to‐use
shown in Table 1 and Figures 8‐9.
“Current crop” 2014/15 KSU Scenario for U.S. Corn Supply‐Demand – 20% Probability
‐ Total Supplies …