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September 1, 2015
Grain Market Outlook
ralia, India, Russia, and elsewhere in “new crop” MY 2015/16, b) the
ongoing geopolitical problems in the Black Sea region and the potential for conflict in the Middle East, and c)
uncertainty in World economic, financial and currency markets. However, the overriding “large crop‐over‐
supply” situation that now exists in World & U.S. wheat markets continues to negatively influence wheat
futures and cash prices. Recovery in wheat market prices may dependent on whether significant problems in
wheat production and/or trade occur in major World wheat producing and exporting areas in year 2015 and
beyond, and for the U.S. how long the strong value of the U.S. dollar relative to other currencies continues.
USDA U.S. Wheat Supply‐Demand & Price Forecast: For U.S. wheat in the “new crop” 2015/16 marketing
year, the USDA projected that there would be 55.079 million acres (ma) planted, 48.454 ma harvested, 44.1
bu/ac yields (down 0.2 bu), 2.136 billion bushels (bb) production (down 12 mb), 3.014 bb total supplies (down
17 mb), 925 million bushel (mb) exports (down 25 mb), 200 mb feed & residual use, 2.164 bb total use (down
25 mb), 850 mb end stocks (up 8 mb), with 39.3% ending‐stocks‐to‐use (up from 38.5% in July, and up to the
highest level since 48.6% in MY 2009/08). The USDA projected U.S. average wheat prices for “new crop” MY
2015/16 in the range of $4.65‐$5.55 /bu. (midpoint =$5.10) – the lowest since $4.87 /bu in MY 2009/10.
KSU U.S. Wheat Supply‐Demand & Price Forecast: Key market factors to consider are the level of 2015 U.S.
hard red spring wheat production, and prospects for improved U.S. wheat exports. Kansas State University
projections of “new crop” MY 2015/16 supply‐demand balances and prices are represented in two scenarios:
A) “Lower Exports” Scenario: 65% 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., 3.014 bb total supplies, 850 mb exports, 2.089 bb total
use, 925 mb ending stocks, 44.3% S/U, and $4.75 /bu U.S. avg. price. B) “Higher Exports” Scenario: 35% prob.
of production prospects equal to the USDA’s but with higher U.S. wheat exports, i.e., 3.014 bb total supplies,
1.000 bb exports, 2.224 bb total use, 790 mb ending stocks, 35.2% S/U, and $5.75 /bu U.S. average price.
USDA World Wheat: The expectation fo large World wheat supplies and stocks are a “burden” on World
wheat markets – driving them toward lower World wheat market prices. Record World total wheat supplies of
936.2 mmt in “new crop” MY 2015/16 are up from 918.6 mmt in “old crop” MY 2014/15, and from 892.1 mmt
in MY 2013/14. Projected World wheat ending stocks in “new crop” MY 2015/16 of 221.5 mmt (31.0% S/U)
are also record high, and up from 209.7 mmt (29.6% S/U) in “old crop” MY 2014/15, and from 193.4 mmt
(27.7% S/U) in MY 2013/14. For perspective, these recent supply‐demand figures can be compared to the
historic World wheat ending stocks and stocks‐to‐use minimums of 128.8 mmt and 21.0% S/U in MY 2007/08.
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I. U.S. Wheat Market Situation & Outlook
I‐A. August 12th USDA Reports & “New Crop” MY 2015/16 Projections
On August 12th the USDA National Agricultural Statistics Service (NASS) in its Crop Production report with
its’ projections of 2015 U.S. wheat production as of August 1, 2015. Wheat production forecasts in the August
12th Crop Production report were based on actual farm operator surveys and objective yield field trials
conducted between July 25th and August 6th by USDA NASS – representing crop conditions and expected yield
and production prospects as of August 1, 2015.
On the same day the USDA World Agricultural Outlook Board (WAOB) released its August 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. corn began on June 1, 2015 and will last
through May 31, 2016.
I‐B. CME KC Hard Red Winter Wheat Futures & U.S. Dollar Index Trends
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
$4.78 ¼ on August 31, 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 …
September 1, 2015
Grain Market Outlook
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I‐C. U.S. Corn Supply‐Demand
U.S. Corn Acreage, Yield & Production
The USDA’s projections of 2015 U.S. corn planted acres from the March 31st Prospective Plantings report
were adjusted downward in the USDA June 30th Acreage report, and have since been used without adjustment
in the July 10th and August 12th USDA Crop Production and WASDE reports. In the June 30, 2015 USDA
Acreage report and subsequent July and August Crop Production reports the USDA projected that 2015 U.S.
corn total planted acreage would be 88.897 million acres (ma), down 302,000 acres from 89.199 ma projected
earlier in the March 31st USDA Prospective Plantings report. This projection of 88.897 ma of 2015 U.S. corn
planted is down 1.700 ma (‐1.9%) from 90.597 ma in 2014, down 6.468 ma (‐6.8%) from 95.365 ma in 2013,
down 8.394 ma (‐8.6%) from the record high of 97.291 ma in 2012, and also down from 91.921 ma in 2011
(Table 1 and Figure 3).
The USDA projected that 2015 U.S. corn harvested acreage would be 81.101 million acres (ma), down
2.035 ma (‐2.4%) from 83.136 ma in 2014, down 6.350 ma (‐7.3%) from the record high of 87.451 ma in 2013,
down 6.534 ma (‐7.2%) from 87.365 ma in 2012, and down from 83.981 ma in 2011 (Table 1 and Figure 3).
The USDA implicitly projected that the proportion of harvested‐to‐planted acreage in 2015 is 91.2%, down
from 91.8% in 2014, and from 91.7% in 2013, but up from 89.9% in drought‐stricken 2012.
The USDA forecast 2015 U.S. average corn yields to be 168.8 bushels per acre (bu/ac) – up 2.0 bu/ac from
the USDA’s July projection, but still less than the record high of 171.0 bu/ac in 2014 (Table 1 and Figure 4).
Although this August 2015 USDA projection of 2015 U.S. corn yields of 168.8 bu/ac is down from the record
171.0 bu/ac in 2014, it would still be the second highest U.S. corn yield to date, being up from 158.1 bu/ac in
2013, the drought affected 2012 low yield of 123.1 bu/ac., 147.2 bu/ac in 2011, 152.8 bu/ac in 2010, and still
up from the previous historic record high of 164.7 bu/ac in 2009.
Based on this combination of USDA projections for 2015 planted acreage (88.897 ma), harvested acreage
(81.101 ma), and yield (168.8 ma – USDA), projected 2015 U.S. corn production would be 13.686 billion
bushels (bb) – up 156 million bushels (mb) from the USDA’s July projections, but down from the record high of
14.216 bb in 2014, and the previous record high of 13.829 bb in 2013. However, this projection of 13.686 bb in
2015 would still be up from 10.755 bb in 2012, 12.314 bb in 2011, 12.425 bb in 2010, and 13.067 bb in 2009
(Table 1).
U.S. Corn Total Supplies
The USDA projects that total supplies of U.S. corn for “new crop” MY 2015/16 are 15.488 bb – up 154
million bushels (mb) from the July 10th WASDE report. This projection of 15.488 bb for “new crop” MY
2015/16 results from beginning stocks of 1.772 bb, projected 2015 production of 13.686 bb, and projected
imports of 30 million bushel (mb) (Table 1 and Figure 5). Since the beginning of the expansion in U.S. ethanol
production in 2006‐2007, total supplies of U.S. corn have been 14.362 bb in MY 2007/08, 13.729 bb in MY
2008/09, 14.749 bb in MY 2009/10, 14.161 bb in MY 2010/11, 13.471 bb in MY 2011/12, 11.904 bb in “short
crop” MY 2012/13, 14.686 bb in MY 2013/14, the estimated 2nd highest amount on record of 15.477 bb in “old
crop” MY 2014/15, and the forecast record high of 15.488 bb in “new crop” MY 2015/16.
The USDA forecast of beginning stocks of 1.772 bb in “new crop” MY 2015/16 is down 7 mb from the July
10th WASDE report, but up substantially from 1.232 bb in beginning stocks in “old crop” MY 2014/15, 821 mb
in MY 2013/14, 989 mb in MY 2012/13, and 1.128 bb in MY 2011/12 – while being up at least moderately from
Page | 5
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 “new crop” MY 2015/16 of 1.772 bb is up considerably from the low of 426 mb that occurred in MY
1996/97, and is the highest amount since 1.967 bb in MY 2006/07 and 2.114 bb in MY 2005/06 (Table 1 and
Figure 5).
Projected imports of 30 mb in “new crop” MY 2015/16 are up 5 mb from July, equal to 30 mb in “old crop”
MY 2014/15, down from 36 mb in MY 2013/14 (the 2nd highest on record), and are 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, but up from 8 mb in MY 2009/10.
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
“new crop” MY 2015/16 (up 25 mb from June and up 50 mb from July) is up from 5.200 bb in “old crop” MY
2014/15, and up from 5.134 bb in MY 2013/14, 4.641 bb in MY 2012/13, and 5.000 bb in MY 2011/12 (Table 1
and Figures 6‐7).
Figure 7 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 2.83 gallons of ethanol produced per bushel of corn (equaling the calculated conversion
of U.S. corn into ethanol in January 2015), these calculations indicate that the equivalent projected annual rate
of U.S. corn used for ethanol production for “old crop” MY 2014/15 has ranged from 4.830‐5.449 bb on a
weekly basis since early September 2014 ‐ the beginning of the “old crop” 2014/15 marketing year. Over the
period of September 1, 2014 through August 21, 2015, corn usage for ethanol production was been on pace to
reach 5.214 bb in “old crop” MY 2014/15. This estimate of 5.214 bb is marginally larger than the USDA’s
August 12, 2015 WASDE report estimate of 5.200 bb of corn to be used for ethanol production during “old
crop” MY 2014/15, with 50.5 of 52 weeks (97.1%) 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 8 – which shows the estimated
amount of a) DDGS 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. According to these KSU
estimates, since MY 2010/11 approximately 0.995‐1.130 of U.S. corn equivalent bushel‐weights (bbeqwt) 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 bbeqwt in DDGS corn‐weight equivalents in MY 2010/11, 1.130 bbeqwt in MY 2011/12, 1.004 bbeqwt in
MY 2012/13, 0.995 bbeqwt in MY 2013/14, 1.008 bbeqwt in both “old crop” MY 2014/15, and 1.017 bbeqwt in “new
crop” MY 2015/16.
Over the five most recent marketing years, DDGS exports in million bushels of corn equivalent weights
(mbeqwt) are estimated to range from 299 to 483 mb, – i.e., 326 mbeqwt in DDGS corn‐weight equivalents in MY
2010/11, 299 mbeqwt in MY 2011/12, 322 mbeqwt in MY 2012/13, 472 mbeqwt in MY 2013/14, a near record 478
mbeqwt in “old crop” MY 2014/15, and a projected record high 483 mbeqwt in “new crop” MY 2015/16.
U.S. Corn Exports: Projected U.S. corn exports of 1.850 bb in “new crop” MY 2015/16 (down 25 mb from
July) is unchanged from 1.850 bb in “old crop” MY 2014/15, less than 1.920 bb in MY 2013/14, and up sharply
from 730 mb in MY 2013/14 – the 41 year low (i.e., since MY 1975/76) (Table 1, Figures 6 and 8).
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According to USDA Foreign Agricultural Service (FAS) weekly export data (http://apps.fas.usda.gov/export‐
sales/esrd1.html), as of August 20th, through the 50th week of “old crop” MY 2014/15 (50 of 52 weeks), 1,737.2 bb
of U.S. corn had been physically shipped for export – equal to 93.6% of the USDA’s projection of 1.850 bb for
“Old Crop crop” MY 2014/15. An additional 125 mb of U.S. corn had been pre‐sold for future export shipments
during the remainder of “old crop” 2014/15 marketing year – prior to August 31, 2015 (the end of “Old Crop
crop” MY 2014/15).
Adding together 1,737.2 mb in past shipments plus 125 mb in forward sales amounts to 1.862 bb, or
100.7% of the USDA’s 1.850 bb U.S. corn export target for “old crop” MY 2014/15 in the August 12th USDA
WASDE report with 97.1% (50.5/52 weeks) of the marketing year completed. United States’ corn export
shipments will need to average 75.2 mb per week for the remaining 1.5 weeks of the “old crop” 2014/15
marketing year to achieve the USDA’s 1.850 bb projection. This compares to 32.3 mb of export shipments for
the week ending August 20th – i.e., being behind of the pace needed to meet the USDA’s most recent export
projection.
It is likely that a number of these remaining “old crop” MY 2014/15 U.S. corn export sales will be cancelled
and “rolled over” into the “new crop” 2015/16 marketing year beginning on September 1, 2015. It is also likely
that the USDA will reduce its estimate of “old crop” 2014/15 corn exports in the upcoming September 11th
USDA WASDE report – an adjustment by itself that would also bring about an increase in U.S. corn ending
stocks in “old crop” MY 2015/16.
Non‐Ethanol FSI: Forecast non‐ethanol food, seed and industrial (FSI) use of 1.375 bb in “new crop” MY
2015/16 is up 15 mb from July, and greater than 1.355 bb in “old crop” MY 2014/15 (up 1 mb from July), and
compares to 1.369 bb in MY 2013/14, and 1.397 bb in MY 2012/13 (Table 1, Figures 6 and 8).
Feed and Residual Use: Forecast U.S. feed and residual use of 5.300 bb in “new crop” MY 2015/16 (up 25
mb from July) is unchanged from 5.300 bb for “old crop” MY 2014/15, but up from 5.030 bb in MY 2013/14,
4.315 bb in MY 2012/13, and 4.519 bb in MY 2011/12 (Table 1, Figures 6 and 8). These levels of corn use for
livestock feeding are somewhat correlated with the amounts of energy feeds per grain consuming animal units
(GCAUs) reported by the USDA over the same time period as illustrated in the following information.
In the USDA August 14th Feed Outlook Report (http://usda.mannlib.cornell.edu/usda/Old Crop/FDS/FDS‐08‐14‐2015.pdf) and
other online resources the USDA Economic Research Service (ERS) indicates that over the MY 2012/13
through “new crop” MY 2015/16 time period, the total amount of Energy Feeds in the U.S. – including corn,
sorghum, barley, oats and wheat – is estimated to be or have been 125.7 million metric tons (mmt) in MY
2012/13 (87.2% corn), 134.3 mmt in MY 2013/14 (95.2% corn), and 144.5 mmt in “old crop” MY 2014/15
(93.1% corn), and 144.5 mmt in “new crop” MY 2015/16 (93.1% corn). Over this same 3 year period, total U.S.
Grain Consuming Animal Units (GCAUs) are estimated to be or have been 92.3 million in MY 2012/13, 91.0
million in MY 2013/14, 93.2 million in “old crop” MY 2014/15, and 95.2 million in “new crop” MY 2015/16.
As a result, U.S. Energy Feeds per Grain Consuming Animal Unit is estimated to be or have been 1.362
metric tons per animal unit (mt/au) in MY 2012/13, 1.477 mt/au in MY 2013/14, and 1.551 mt/au in “old crop”
MY 2014/15, and is projected to be 1.517 mt/au in “new crop” MY 2015/16. 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 successive record “large crop” years of MY 2013/14, “old crop” MY 2014/15, and now into
the expected third consecutive large crop year in “new crop” MY 2015/16 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 –
contributing to downward pressure on the prices of U.S. corn and other feedgrains.
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Total Use of U.S. Corn for “new crop” MY 2015/16 is projected to be a record high 13.775 bb (up 40 mb
from July) – up from the previous record high of 13.706 bb in “old crop” MY 2014/15 (up 9 mb from July)
(Table 1 and Figures 6 and 8). United States’ total corn use has varied widely in recent marketing years – due
largely to changes in available U.S. corn supplies. Corn use in the U.S. over time has changed from 12.737 bb in
MY 2007/08, to 12.008 bb in MY 2008/09, 13.041 bb in MY 2009/10, 13.033 bb in MY 2010/11, 12.482 bb in
MY 2011/12, 11.083 bb in MY 2012/13, the one time record high of 13.454 bb in MY 2013/14, the previous
record high amount of 13.705 bb in “old crop” MY 2014/15, and now the new projected record high of 13.775
bb in “new crop” MY 2015/16.
U.S. Corn Ending Stocks, % Ending Stocks‐to‐Use, & Prices
U.S. corn ending stocks for “new crop” MY 2015/16 are projected to be 1.713 bb (up 114 mb from July),
which is down 59 mb from 1.772 bb in “old crop” MY 2014/15 (also down 9 mb from July) (Table 1 & Figure 9).
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 1.772 bb in “old crop” MY 2014/15, and now are forecast
to be 1.713 bb in “new crop” MY 2015/16.
Projected percent (%) ending stocks‐to‐use of 12.44% in “new crop” MY 2015/16 is up from 11.64% in the
July WASDE report, and down from 12.93% in “old crop” MY 2014/15 (Table 1 and Figures 9 and 10). On a
year‐by‐year basis, U.S. corn % ending stocks‐to‐use trended downward from 12.75% in MY 2007/08 and
13.94% in MY 2008/09, to 13.10% in MY 2009/10, 8.65% in MY 2010/11, 7.92% in MY 2011/12, and then down
to 7.41% in “drought stricken” MY 2012/13. Then U.S. corn ending stocks‐to‐use increased for the first time in
six (6) years to 9.16% in MY 2013/14, and then increased again to 12.93% in “old crop” MY 2014/15 – with a
projected decline to 12.44% in “new crop” MY 2015/16.
U.S. average corn prices for “new crop” MY 2015/16 are projected to be in the range of $3.35‐$3.95 bu/ac
(midpoint = $3.65) – down marginally from a projection of $3.45‐$4.05 ($3.70 midpoint) by the USDA in last
month’s July 10th WASDE report (Table 1 and Figures 9 and 10). Since the beginning of the rapid expansion in
U.S. ethanol production in 2006, U.S. corn prices have moved 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 August 12th WASDE projection
holds true, prices will now have declined year‐by‐year since the $6.89 record high in MY 2012/13, down to
$4.46 in MY 2013/14, $3.65‐$3.75 (midpoint = $3.70) in “old crop” MY 2014/15, and now to a projected range
of $3.35‐$3.95 (midpoint = $3.65) in “new crop” MY 2015/16.
I‐D. KSU Corn Market Scenarios for “New Crop” MY 2015/16
Kansas State University Research and Extension has provided forecasts of U.S. corn supply‐demand
balances and prices for the “new crop” MY 2015/16 to complement and expand upon those of the USDA, with
details provided below. Three probability‐weighted Kansas State University (KSU) projections are provided.
The first scenario is based on USDA reported 2015 U.S. corn planted acreage with a 101 ma reduction from
the USDA’s forecast of 2015 U.S. harvested acres, and with a 2015 U.S. corn yield of 167.5 bu/ac and 13.568 bb
of 2015 U.S. corn production – and is given a 40% probability of occurring in 2015. The second scenario is
based on the same U.S. corn acreage estimates as in the first scenario, but with a lower U.S. corn yield of 165.0
bu/ac and 13.356 bb of 2015 U.S. corn production – and is given a 50% probability of occurring in 2015. The
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third scenario is based on the same USDA planted acreage projections as the first two scenarios, but with a
more pronounced short crop “low yield” of 155.0 bu/ac and 12.555 bb of 2015 U.S. corn production – and is
given a 10% probability of occurring in 2015.
KSU Scenario #1 – A “Normal Crop” of 13.568 bb with 40% Likelihood of Occurring
For “new crop” MY 2015/16, this “normal crop” yield KSU projection reflects the likelihood of a reduction
in U.S. corn harvested acreage in 2015 (down approximately 100 ma from current USDA projections), and how
U.S. corn yields that are marginaly lower than USDA’s most recent August 12th NASS Crop Production report
projection would impact 2015 U.S. corn production, supply‐demand balances and prices in the coming “new
crop” 2015/16 marketing year, i.e., September 1, 2015 through August 31, 2016. This scenario is thought to
have approximately a 40% probability of occurring (i.e., 4 out of 10) at this point in time.
Specifically, this KSU U.S. corn supply‐demand scenario assumes that 2015 U.S. corn planted acreage will
be down 1.700 million acres (ma) to 88.897 ma (equal to the USDA’s June 30th Acreage Report projection and
the August 12th Crop Production report forecast), with 2015 U.S. corn harvested acreage down 2.136 ma to
81.000 ma (down 101 ma from the USDA’s August 12th Crop Production report projection) (Table 1 and Figure
3). Forecast 2015 U.S. corn yields of 167.5 bu/ac in this scenario are down from the USDA’s August 12th
forecast of 168.8 bu/ac, but still would be the second highest on record, and up from the long term (1973‐
2014) trend line U.S. corn yields of 162.3 bu/ac. Taking these forecasts of 2015 U.S. corn acreage and yields
together, 2015 U.S. corn production is forecast to be 13.568 bb.
Following these projections of corn production for “new crop” MY 2015/16, U.S. total corn usage is then
estimated to be a record high 13.775 – equal to the USDA’s August 12th projection for “new crop” MY 2015/16
(Table 1 and Figure 6). In this scenario, KSU estimates are for U.S. corn ending stocks to be 1.595 bb, and for %
ending stocks‐to‐use of 11.58% for “new crop” MY 2015/16. Marketing year average U.S. corn prices would
be projected to average near $4.25 /bu for “new crop” MY 2015/16 (Table 1 and Figures 9 and 10).
Following is the KSU “normal crop” U.S. corn supply‐demand and price scenario for “new crop” MY
2015/16 – given a 40% probability of occurring (4 out of 10 odds).
1st KSU Scenario for “New Crop” MY 2015/16 U.S. Corn Supply/Demand & Prices
Estimated Probability of Occurring = 40% …
May 18, 2015
Grain Market Outlook
I‐C. U.S. Corn Supply‐Demand – Focus on “New Crop” 2015/16 Projections
U.S. Corn Acreage, Yield & Production
In the March 31, 2015 USDA Prospective Plantings report the USDA projected that 2015 U.S. corn total
planted acreage would be 89.199 million acres (ma), down 2.398 ma (‐1.5%) from 90.597 ma in 2014, down
6.166 ma (‐6.5%) from 95.365 ma in 2013, down 8.092 ma (‐8.3%) from 97.291 ma in 2012, and down from
91.921 ma in 2011 (Table 1 and Figure 3).
Given the USDA’s implicit assumption of an average harvested‐to‐planted acreage of 91.6%, 2015 U.S. corn
harvested acreage would be approximately 81.715 ma, down 1.421 ma (‐1.7%) from 83.136 ma in 2014, down
5.736 ma (‐6.6%) from 87.451 ma in 2013, down 5.650 ma (‐6.5%) from 87.365 ma in 2012, and down from
83.981 ma in 2011.
The 2014 U.S. average corn yield of 171.0 bushels per acre (bu/ac) is a record high and unchanged from
the January‐May USDA reports, and is higher than the 166.8 bu/ac estimate for 2015 in the May WASDE report
(Table 1 and Figure 4). Although this early 2015 USDA projection of 166.8 bu/ac is down from 171.0 bu/ac in
2014, it would be the second highest U.S. corn yield on record, being up from 158.1 bu/ac in 2013, the drought
affected 2012 low yield of 123.1 bu/ac., 147.2 bu/ac in 2011, 152.8 bu/ac in 2010, and up from the previous
historic record high of 164.7 bu/ac in 2009.
Based on this combination of projections for 2015 planted acreage (89.199 ma – from the USDA),
harvested acreage (81.715 ma – a KSU assumption calculated by dividing the USDA’s 2015 production forecast
by the 2015 yield projection), and yield (166.8 ma – USDA), 2015 U.S. corn production would be 13.630 billion
bushels (bb) – down from the record high of 14.216 bb 2014, and the previous record high of 13.829 bb in
2013 – but up from 10.755 bb in 2012, 12.314 bb in 2011, 12.425 bb in 2010, and 13.067 bb in 2009 (Table 1).
U.S. Corn Total Supplies
The USDA projects that total supplies of U.S. corn for “new crop” MY 2015/16 are a record high 15.506 bb
– resulting from beginning stocks of 1.851 bb, projected 2015 production of 13.630 bb, and projected imports
of 25 million bushel (mb) (Table 1 and Figure 5). Total supplies of near 15.506 bb in “new crop” MY 2015/16
would be a record high, being comparable to 14.362 bb in MY 2007/08, 13.729 bb in MY 2008/09, 14.749 bb in
MY 2009/10, 14.161 bb in MY 2010/11, 13.471 bb in MY 2011/12, 11.904 bb in “short crop” MY 2012/13,
14.686 bb in MY 2013/14, and the previous record high of 15.472 bb in “current” MY 2014/15.
The USDA forecast of beginning stocks of 1.851 bb in “new crop” MY 2015/16 is up substantially from
1.232 bb in beginning stocks in “current crop” MY 2014/15, 821 mb in MY 2013/14, 989 mb in MY 2012/13,
and 1.128 bb in MY 2011/12, and at least moderately larger 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 “new crop” MY 2015/16 of 1.851 bb
is up considerably from the low of 426 mb that occurred in MY 1996/97, and is the highest since 1.967 bb in
MY 2006/07 and 2.114 bb in MY 2005/07 (Table 1 and Figure 5).
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Projected imports of 25 mb in “current crop” MY 2015/16 are equal to “current” MY 2014/15, but down
from 36 mb in MY 2013/14 (the 2nd highest on record), 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 5.200 bb in
“new crop” MY 2015/16 is unchanged from 5.200 bb in “current” MY 2014/15, but up from 5.134 bb in MY
2013/14, 4.641 bb in MY 2012/13, and 5.000 bb in MY 2011/12 (Table 1 and Figures 6‐7).
Figure 7 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 2.83 gallons of ethanol produced per bushel of corn (equaling the calculated conversion
of U.S. corn into ethanol in January 2015), 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 4.830‐5.438 bb on a
weekly basis since early September 2014 ‐ the beginning of the “current crop” 2014/15 marketing year. Over
the period of September 1, 2014 through May 8, 2015, corn usage for ethanol production was been on pace to
reach 5.170 bb in “current crop” MY 2014/15. This estimate of 5.170 bb is only 30 mb less than the USDA’s
May 12, 2015 WASDE report estimate of 5.200 bb of corn to be used for ethanol production during “current
crop” MY 2014/15, with 36 of 52 weeks (69.2%) 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 8 – which shows estimated a) DDGS
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. According these estimates,
since MY 2010/11 approximately 0.993‐1.130 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 in MY
2013/14, and 1.006 bb in both “current crop” MY 2014/15 and “new crop” MY 2015/16. Over the five most
recent marketing years, DDGS exports in corn equivalent weights are estimated to range from 299 to 479 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 in MY 2013/14, and a record high 479 mb in both “current crop” MY 2014/15 and in “new crop” MY
2015/16.
U.S. Corn Exports: Projected U.S. corn exports of 1.900 bb in “new crop” MY 2015/16 is up from 1.825 bb
(up 25 mb) in “current” MY 2014/15, less than 1.917 bb in MY 2013/14, and up sharply from 730 mb in MY
2013/14 – the 41 year low (since MY 1975/76) (Table 1, Figures 6 and 8).
According to the USDA Foreign Agricultural Service (FAS) weekly export data (http://apps.fas.usda.gov/export‐
sales/esrd1.html), as of May 7th, through the 36th week of “current crop” MY 2014/15 (36 of 52 weeks), 1.145 bb of
U.S. corn had been physically shipped for export – equal to 69.2% of the USDA’s updated projection for
“current crop” MY 2014/15 of 1.825 bb. An additional 498.8 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).
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Adding together 1,145.1 mb in past shipments plus 498.8 mb in forward sales amounts to 1,634.9 mb, or
89.6% of the USDA’s 1.825 bb U.S. corn export target for “current crop” MY 2014/15 in the May 12th USDA
WASDE report with 69.2% (36/52 weeks) of the marketing year completed. United States’ corn exports will
need to average 42.5 mb per week for the remainder of the “current crop” 2014/15 marketing year to achieve
the USDA’s 1.825 bb projection. This compares to 44.7 mb and 43.7 mb of export shipments for the weeks
ending April 30th and May 7th, respectively – i.e., each being ahead of the pace needed to meet the USDA’s
export projection, respectively.
Non‐Ethanol FSI: Forecast non‐ethanol food, seed and industrial (FSI) use of 1.360 bb in “new crop” MY
2015/16 is greater than 1.347 bb in “current” MY 2014/15 (reduced 48 mb from the April WASDE), and
compares to 1.369 bb in MY 2013/14 (up 2 mb), and 1.397 bb in MY 2012/13 (Table 1, Figures 6 and 8).
Feed and Residual Use: Forecast U.S. feed and residual use of 5.300 bb in “new crop” MY 2015/16 is up
from 5.250 bb for “current” MY 2014/15, 5.034 bb in MY 2013/14, 4.315 bb in MY 2012/13, and 4.520 bb in
MY 2011/12 (Table 1, Figures 6 and 8). These levels of corn use for livestock feeding are somewhat correlated
with the amounts of energy feeds per grain consuming animal units (GCAUs) reported by the USDA over the
same time period as illustrated in the following information.
In the USDA May 14th Feed Outlook Report (http://usda.mannlib.cornell.edu/usda/current/FDS/FDS‐05‐14‐2015.pdf) the
USDA Economic Research Service (ERS) indicates that over the MY 2013/14 through “new crop” MY 2015/16
time period, the total amount of Energy Feeds in the U.S. – including corn, sorghum, barley, oats and wheat –
is estimated to be 134.3 million metric tons (mmt) in MY 2013/14 (95.2% corn), and 141.8 mmt in “current”
MY 2014/15 (94.1% corn), and is projected to be 144.3 mmt in “new crop” MY 2015/16 (93.36% corn). Over
this same 3 year period, total U.S. Grain Consuming Animal Units (GCAUs) are estimated to be 110.8 million in
MY 2013/14, 93.2 million in “current” MY 2014/15, and 94.7 million in “new crop” MY 2015/16.
As a result, U.S. Energy Feeds per Grain Consuming Animal Unit is estimated to be 1.212 metric tons per
animal unit (mt/au) in MY 2013/14, and 1.521 mt/au in “current” MY 2014/15, and is projected to be 1.524
mt/au in “new crop” MY 2015/16. 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”
years of MY 2013/14 and “current” MY 2014/15, and now into the expected third consecutive large crop year
in “new crop” MY 2015/16 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 the prices of
U.S. corn and other feedgrains.
Total Use of U.S. Corn for “new crop” MY 2015/16 is projected to be a record high 13.760 bb – up from the
current record highs of 13.622 bb in “current” MY 2014/15, and 13.454 bb in MY 2013/14, and up sharply from
11.083 bb in drought‐affected MY 2012/13 (Table 1 and Figures 6 and 8). United States’ total corn use has
varied widely in recent marketing years – due largely to changes in available U.S. corn supplies. Corn use in the
U.S. over time has changed from 12.737 bb in MY 2007/08, to 12.008 bb in MY 2008/09, 13.041 bb in MY
2009/10, 13.033 bb in MY 2010/11, 12.482 bb in MY 2011/12, 11.083 bb in MY 2013/14, the one time record
high of 13.454 bb in MY 2013/14, the previous record high amount of 13.622 bb in “current crop” MY 2014/15,
and now the new projected record high of 13.760 bb in “new crop” MY 2015/16.
U.S. Corn Ending Stocks, % Ending Stocks‐to‐Use, & Prices
U.S. corn ending stocks for “new crop” MY 2015/16 are projected to be 1.746 bb – down 105 mb from
1.851 bb in “current” MY 2014/15, but up from 1.232 bb in MY 2013/14 (Table 1 & Figure 9). Since MY
Page | 7
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, 1.851 bb in “current crop” MY 2014/15, and now 1.746 bb in “new crop” MY
2015/16.
Projected percent (%) ending stocks‐to‐use of 12.69% in “new crop” MY 2015/16 is down from 13.59% in
“current” MY 2014/15 (Table 1 and Figures 9 and 10). On a year‐by‐year basis, U.S. corn % ending stocks‐to‐
use trended downward from 12.75% in MY 2007/08 and 13.94% in MY 2008/09, to 13.10% in MY 2009/10,
8.65% in MY 2010/11, 7.92% in MY 2011/12, and then down to 7.41% in “drought stricken” MY 2012/13,
before increasing for the first time in six (6) years to 9.16% in MY 2013/14, and then to 13.49% in “current” MY
2014/15 – with a projected decline to 12.69% in “new crop” MY 2015/16.
U.S. average corn prices for “new crop” MY 2015/16 are projected to be in the range of $3.20‐$3.80 bu/ac
(midpoint = $3.50) (Table 1 and Figures 9 and 10). Since the beginning of the rapid expansion in U.S. ethanol
production in 2006, U.S. corn prices have moved first higher, then lower, and then 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 2013/14.
However, if the May 12th WASDE projection holds true, prices will now have declined for three consecutive
years since the $6.89 record high in MY 2012/13, down to $4.46 in MY 2013/14, down to $3.55‐$3.75
(midpoint = $3.65) in “current crop” MY 2014/15, and now down to $3.20‐$3.80 in “new crop” MY 2015/16.
I‐D. KSU Corn Market Scenarios for “New Crop” MY 2015/16
Kansas State University Extension has provided forecasts of U.S. corn supply‐demand balances and prices
for the “new crop” 2015/16 marketing year to complement and expand upon those of the USDA, with details
provided below. Three probability‐weighted Kansas State University (KSU) projections are provided.
The first scenario is based on USDA reported U.S. corn acreage with a normal crop “trend yield” of 162.25
bu/ac – given a 55% probability of occurring in 2015. The second scenario is based on lower U.S. corn planted
acreage in 2015 than projected by the USDA, again coupled with a normal crop “trend yield” of 162.25 bu/ac –
given a 25% probability of occurring in 2015. The third scenario is based on USDA planted acreage projections
and a short crop “low yield” of 155.0 bu/ac (given a 20% probability of occurring in 2015).
KSU Scenario #1 – A “Normal Crop” of 13.262 bb with 55% Likelihood of Occurring
For “new crop” MY 2015/16, this “normal crop” trend line yield KSU projection reflects the likelihood of a
reduction in U.S. corn planted acreage in 2015, and how a possible return to long term trend line U.S. corn
yields in 2015 along with a moderation of 2015 U.S. corn production, would likely affect U.S. corn supply‐
demand balances and prices in the coming “new crop” 2015/16 marketing year, i.e., September 1, 2015
through August 31, 2016. This scenario is thought to have approximately a 55% probability of occurring (i.e.,
5.5 out of 10) at this point in time.
Specifically, this KSU U.S. corn supply‐demand scenario assumes that 2015 U.S. corn planted acreage will
be down 1.398 million acres (ma) to 89.199 ma (equal to the USDA’s May WASDE projection), with 2015 U.S.
corn harvested acreage also down 1.421 ma to 81.715 ma (also equal to the USDA May WASDE projection)
(Table 1 and Figure 3). With a return to long term (1973‐2014) trend line U.S. corn yields of 162.3 bu/ac, 2015
U.S. corn production is forecast to be 13.262 bb.
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Following these projections of corn production for “new crop” MY 2015/16, U.S. total corn usage is then
estimated to be a record high 13.730 – but down from the USDA’s May 2015 projection of 13.760 bb for “new
crop” MY 2015/16 (Table 1 and Figure 6).
KSU estimates are for U.S. corn ending stocks to be 1.408 bb, and for % ending stocks‐to‐use of 10.25% for
“new crop” MY 2015/16. United State’s corn average prices would be projected to average near $4.25 /bu for
“new crop” MY 2015/16 (Table 1 and Figures 9 and 10).
Following is the “normal crop / trend yield” U.S. corn supply‐demand and price scenario for “new crop” MY
2015/16 – given a 55% probability of occurring.
1st KSU Scenario for “New Crop” MY 2015/16 U.S. Corn Supply/Demand & Prices
Estimated Probability of Occurring = 55% …
November 18, 2014
Grain Market Outlook
CME eCorn Futures
Mar. 19 – Nov. 14, 2014
Close = $4.06 ½ on 11/17/2014
DEC 2014 CME eCorn Futures
Mar. 20 – Nov. 17, 2014
Close = $3.77 ½ on 11/17/2014
Page | 3
The “new crop” JULY 2015 corn futures market contract also responded in a moderately positive manner
to the information in the November 10th USDA reports. On the day of the report – Monday, November 10th –
CME JULY 2015 corn futures prices opened at $3.94 per bushel, trading within the range of $3.93 ¾ ‐ $4.07
during the session, before settling at $3.98 ½ – up $0.02 per bushel for the day (Figure 1). Since then, JULY
2015 corn futures prices have traded in a range from a low of $3.94 ½ on Tuesday, November 11th to a high of
$4.17 on Thursday, November 13th, before closing at $4.06 ½ on Monday, November 17th.
Question: Do the prices in early October represent a fall harvest low?
In hindsight now it seems that the upward trend in DEC 2014 and JULY 2015 corn futures prices since the
$3.46 ¾ low trading price on October 1, 2014 may signal that the fall harvest market low in corn futures prices
has occurred. Of course the results of the December 2014 and the January 2015 USDA crop production and
WASDE reports and the grain market’s reaction to them as well as other possible market influencing factors
will be key determinants as to whether these price levels ultimately represent the fall harvest “lows” for this
grain marketing year.
A time of seasonal market weakness typically has occurred during the months of January‐February in large
crop – low price years. Therefore it is still possible that prices may trend lower again sometime before spring,
2015. However, the $3.46 ¾ low on October 1st will be a key point of support for CME MARCH 2015 or CME
MAY 2015 corn futures prices should such a seasonal price decline occur in coming months.
I‐C. U.S. Corn Supply‐Demand – USDA Projections for “New Crop” 2014/15
U.S. Corn Acreage, Yield & Production
The USDA projected that 2014 U.S. corn total planted acreage would be 90.885 million acres (ma) –
unchanged from October (Table 1 and Figure 2). Planted acreage of 90.885 million acres in 2014 is down from
95.365 ma in 2013, 97.291 ma in 2012 (adjusted 116,000 acres higher by the USDA), and 91.936 ma in 2011.
In addition, the USDA projected 2014 U.S. corn harvested acreage to be 83.097 ma – unchanged from October
but down from 87.668 ma in 2013, and 87.365 ma in 2012, while still being up from 81.446 ma in 2011. The
2014 proportion of harvested‐to‐planted acreage for all U.S. corn is projected to be 91.4%, down from 91.9%
in to 2013, but up from 89.8% in 2012, and equal to 91.4% in 2011.
The projected 2014 U.S. average corn yield of 173.4 bushels per acre (bu/ac) would be a record high, but is
down from the earlier USDA projection of 174.2 bu/ac in October (Table 1 and Figure 3). This projection of
173.4 bu/ac in November 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 historic high of 164.7 bu/ac in 2009. Based on these 2014 acreage and yield
forecasts, the USDA projected 2014 U.S. corn production to be 14.407 billion bushels (bb) – which would be
the highest amount on record, larger than the current record high of 13.925 bb in 2013, 10.755 bb in 2012
(adjusted lower by 25 million bushels or “mb”), 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 “new crop” MY 2014/15 are a record high 15.668 bb
– resulting from beginning stocks of 1.236 bb, projected 2014 production of 14.407 bb, and projected imports
of 25 million bushel (mb) (Table 1 and Figure 4). Total supplies of 15.668 bb in “new crop” MY 2014/15 are
Page | 4
comparable to 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 MY 2012/13, and 14.782 bb in
“old crop” MY 2013/14 (2nd highest).
Beginning stocks of 1.236 bb in “new crop” MY 2014/15 are unchanged from October, but down from an
early season projection of 1.246 bb by the USDA in the July 2014 WASDE report (Table 1 and Figure 4).
Projected beginning stocks of 1.236 bb in “new crop” MY 2014/15 are up sharply from 821 mb in “old crop”
MY 2013/14, and from 989 mb in MY 2012/13. This amount of beginning stocks is up considerably from the
low of 426 mb occurring in MY 1996/97. Imports of 25 mb in “new crop” MY 2014/15 are projected to be
down from 36 mb in “old crop” MY 2013/14 (the 2nd highest), and 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 5.150 bb in
“new crop” MY 2014/15 is up 25 mb from September‐October – following from expectations of low corn input
prices and a continuation of at least marginal profitability for U.S. ethanol production (Table 1 and Figures 5‐
6). This projection of 5.150 bb in “new crop” MY 2013/14 is up from 5.134 bb in “old crop” MY 2013/14 (up 4
mb), while being up from 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 “new crop” MY 2014/15 has
ranged from 4.911‐5.278 bb on a weekly basis since early September 2014 ‐ the beginning of the “new crop”
2014/15 marketing year. Over the period of from September 1, 2014 through November 7, 2014, corn usage
for ethanol production was been on pace to reach 5.085 bb in “new crop” MY 2014/15. This estimate of 5.085
bb is less than the USDA’s adjusted November 2014 WASDE report estimate of 5.150 bb of corn to be used for
ethanol production during “new crop” MY 2014/15, with 10 of 52 weeks for 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
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 1.049‐1.164 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, 1.049 bb in MY 2012/13, 1.160 bb
projected for “old crop” MY 2013/14, and a projection of 1.164 bb in “new crop” MY 2014/15. Over the same
five most recent marketing years, DDGS exports in corn equivalent weights are estimated to range from 277 to
307 mb, with approximately 307 bb of DDGS‐corn equivalents projected for the “new crop” MY 2014/15 U.S.
corn marketing year.
U.S. Corn Exports: Projected U.S. corn exports of 1.750 in “new crop” MY 2014/15 are down from the
estimate of 1.917 bb in “old crop” MY 2013/14, but are up sharply from 730 mb in MY 2012/13 – the 40 year
Page | 5
low since MY 1975/76 (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 November 11th, through the tenth week of “new crop”
MY 2014/15 (10 of 52 weeks), 295.6 mb of U.S. corn had been physically shipped for export – equal to 16.9%
of the USDA’s updated projection for “new crop” MY 2014/15 of 1.750 bb. An additional 481.0 mb of U.S. corn
had been pre‐sold for future export shipments during the “new crop” 2014/15 marketing year – prior to
August 31, 2015 (the end of “new crop” MY 2014/15).
Adding together 295.6 mb in past shipments plus 481.0 mb in forward sales amounts to 776.6 mb, or
44.4% of the USDA’s 1.750 bb U.S. corn export target for “new crop” MY 2014/15 in the November 10th USDA
WASDE report with 19.2% (10/52 weeks) of the marketing year completed. United States’ corn exports will
need to average 34.6 mb per week for the remainder of the “new crop” 2014/15 marketing year to achieve the
USDA’s 1.750 bb projection. This compares to 17.5 mb and 23.7 mb of export shipments for the weeks ending
October 30th and November 6th, 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 1.385 bb (down 30 mb from
October) in “new crop” MY 2014/15 is greater than 1.363 bb (down 11 mb) in “old crop” MY 2013/14, and
compares to 1.397 bb in MY 2012/13, and 1.428 bb in MY 2011/12 (Figures 5 and 7).
Feed and Residual Use: Forecast U.S. feed and residual use of 5.375 bb in “new crop” MY 2014/15 is
unchanged from October but up 25 mb from the September WASDE report (Figures 5 and 7). This projection
of 5.375 bb in “new crop” MY 2014/15 is up from 5.132 bb for “old crop” MY 2013/14 (up 8 mb), and up from
4.315 bb in MY 2012/13 (down 25 mb). 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 November 13th Feed Outlook Report (http://www.http://usda.mannlib.cornell.edu/usda/current/FDS/FDS‐11‐13‐
2014.pdf) the USDA Economic Research Service (ERS) indicates that over the MY 2012/13 through “new 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 125.8 million metric tons (mmt) in MY 2012/13 (87.1% corn), and 137.0 mmt
in “old crop” MY 2013/14 (95.2% corn), and is projected to be 146.3 mmt in “new crop” MY 2014/15 (93.3%
corn). Over this same three year period, total U.S. Grain Consuming Animal Units were estimated to be 92.3
million in MY 2012/13, and 90.3 million in “current” MY 2013/14, and are projected to be 91.5 million in “new
crop” MY 2014/15.
As a result, U.S. Energy Feeds per Grain Consuming Animal Unit is estimated to be 1.363 metric tons per
animal unit (mt/au) in MY 2012/13, and 1.517 mt/au in “old crop” MY 2013/14, and is projected to be 1.599
mt/au in “new 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 “old crop” MY 2013/14,
and now into “new crop” MY 2014/15, the amount of energy feeds fed per animal unit and total feed use of
U.S. corn has and is projected to also increase.
Total Use of U.S. Corn for “new crop” MY 2014/15 is projected to be 13.660 bb – up 5 mb from October.
This amount is up from 13.546 bb in “old crop” MY 2013/14, and up sharply from 11.083 bb (down 25 mb) in
drought‐affected MY 2012/13 (Table 1 and Figures 5 & 7). United States’ total corn use has varied based
largely on available U.S. corn supplies in recent years, 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 current record high of 13.546 bb in “old crop” MY 2013/14, and the projected new record high
amount of 13.660 bb in “new crop” MY 2014/15.
Page | 6
U.S. Corn Ending Stocks, % Ending Stocks‐to‐Use, & Prices
U.S. corn ending stocks for “new crop” MY 2014/15 are projected to be 2.008 bb – down 73 mb from the
October WASDE report (Table 1 & Figure 4). This forecast amount of U.S. corn ending stocks of 2.008 bb in
“new crop” MY 2014/15 up from 1.236 bb in “old crop” MY 2013/14, and from 821 mb in MY 2012/13. 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, and 1.236 bb in “old crop” MY 2013/14, and are now projected to be 2.008 bb in “new crop” MY
2014/15.
Projected percent (%) ending stocks‐to‐use of 14.8% in “new crop” MY 2014/15 are up from 15.3% in the
October WASDE report (Table 1 and Figures 8‐9). United States’ 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 to 7.4% in “drought stricken” MY 2012/13, before increasing for the first
time in six (6) years to 9.1% in “old crop” MY 2013/14, and now to a projected level of 14.8% in “new crop” MY
2014/15.
U.S. average corn prices for “new crop” MY 2014/15 are projected to be in the range of $3.20‐$3.80 bu/ac
(midpoint = $3.50) (Table 1 & Figures 8‐9) – up from $3.10‐$3.70 (midpoint = $3.40) in the October WASDE
report, and equal to the forecast price range in the September 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, up to the record high of
$6.89 in “drought stricken” MY 2012/13. However, if the November 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 “old crop” MY 2013/14, and again down to $3.20‐$3.80 (midpoint = $3.50) in “new crop” MY 2014/15.
I‐D. KSU U.S. Corn Market Scenarios: “New Crop” MY 2014/15 & “Next Crop” MY
2015/16
Kansas State University forecasts of U.S. corn supply‐demand balances for “new crop” in the 2014/15 and
“next crop” 2015/16 marketing years are provided below. Given the market information available in mid‐
November 2014, these conservative price projections that follow seem reasonable – especially for the current
marketing year, i.e., “new crop” MY 2014/15. However, some marginal amount of 2014 U.S. corn production
uncertainty still remains that may be resolved in the January 12, 2015 USDA NASS Crop Production Annual
Summary report. Also, there is the possibility that the USDA is overly pessimistic in its projections of U.S. corn
usage in the “new 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.
These Kansas State University supply‐demand and price projections for “new crop” MY 2014/15 reflect
the possibility of U.S. corn usage being underestimated by the USDA in the current marketing year. However,
for “next crop” MY 2015/16, these KSU projections reflect the likelihood of a reduction in U.S. corn acreage in
2015, and how a possible return to trendline U.S. corn yields and a moderation of 2015 U.S. corn production in
would be likely affect U.S. corn supply‐demand balances and prices in the next marketing year, i.e., September
1, 2015 through August 31, 2016.
Page | 7
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 “new crop” MY 2014/15 are based on projections of
U.S. corn % ending stocks‐to‐use shown in Table 1 and Figures 8‐9.
A. “New Crop” 2014/15 KSU Scenario for U.S. Corn Supply‐Demand – 40% Probability
‐ Total Supplies …
March 20, 2015
Grain Market Outlook
rts as a proportion of World
soybean trade in “current year” MY 2014/15 has been offset by increases in United States’ exports.
Uptrends in United States’ Soybean Production & Exports
The growth in United States’ soybean production and exports compares to that in South America over this
same three period, with 82.8 mmt of U.S. soybean production in MY 2012/13 (30.8% of World total), 91.4 mmt
in MY 2013/14 (32.2% of World total), and 108.0 mmt in “current crop” MY 2014/15 (34.3% of the World
total). United States’ soybean production in “current crop” MY 2014/15 is projected to be up 18.2% over last
year, and up 30.5% over two years ago.
United States’ soybean exports have grown from 35.9 mmt in MY 2012/13 (35.7% of World total), to 44.8
mmt in MY 2013/14 (39.6% of World total), and a projected amount of 48.7 mmt in “current crop” MY
2014/15 (41.5% of the World total). United States’ soybean exports in “current crop” MY 2014/15 are
projected to be up 8.7% over last year, and up 35.9% over two years ago.
The Necessity to the Soybean Market of Continued Strength in Chinese Import Demand
It is widely acknowledged by soybean market analysts that continued growth and/or at least “level
sustainability” of Chinese soybean imports at current and projected levels is necessary for continuance of the
historically high World soybean market prices that have occurred since the 2012/13 marketing year. Market
analysts have speculated that Chinese soybean import demand growth may eventually slow due to swine
industry production issues or other broad, systematic economic and/or financial factors within the country.
However, the USDA has continued to project that strong growth would occur in Chinese soybean imports in
“current crop” MY 2014/15 and “next crop” MY 2015/16, and beyond. If this recent upward trend in Chinese
soybean imports and import demand were to falter, it would undoubtably have a substantial negative impact
on U.S. and World soybean market prices.
As a result of a record large fall harvest of soybeans in the United States in 2014, cash soybean prices had
fallen below $9.00 per bushel in late November, but have since moved higher. Central Kansas Terminal cash
bids were in the range of $9.00 ¾ ($0.61 under basis) to $9.31 ¾ ($0.30 under basis) on Thursday, March 19th.
Soybean forward contract prices for fall harvest in October 2015 in the key central Kansas market of
Hutchinson, Kansas were in the range of $8.62 / bu. ($0.86 under basis) to $8.96 ($0.50 under basis). “Current
crop” MAY 2015 soybean futures closed at $9.62 ½ per bushel that day, with “next year’s crop” NOVEMBER
2015 soybean futures closing at $9.47 ¾ per bushel.
Given that the USDA projections for “current crop” MY 2014/15 and “next crop” MY 2015/16 indicate that
a) Chinese soybean imports will continue to be strong, and b) South American soybean production to be
harvested in early‐mid 2015 will again be record high, there is no indication yet that any change is expected in
these projected trends in production, exports or imports in the broader World soybean market. The
Page | 4
possibility of weather‐related soybean production problems in South America during the spring of 2015, or in
the United States during the summer‐fall of 2015 could impact these trends. However, until such potential
production problems actually do occur the World soybean market will likely assume that these “predominant
trends” will continue into the foreseeable future.
I‐C. Soybean Futures Trends Since the March 10th USDA Reports
“Current crop” MAY 2015 soybean futures contract prices responded in a negative manner to the
information in the March 10th USDA reports (Figure 1). On the day of the reports CME MARCH 2015 futures
prices opened at $9.92 ½ /bu, and traded as high as $9.94 and as low as $9.81 ¾ during the session, before
settling at $9.84 ½ – down $0.08 ¾ for the day. Since then MAY 2015 soybean futures prices have traded
within the range from a high of $9.97 ½ on March 11th and 12th, to a low of $9.53 ½ on March 17th and 18th,
before closing at $9.73 ¾ on Thursday, March 20th.
Figure 1. MAY 2015 and NOV 2015 CME Soybean Futures Price Charts (electronic trade) …
August 31, 2016
Grain Market Outlook
in storage after fall harvest, 2) anticipation of continued strong use of 2015‐2016 crop U.S.
corn in domestic U.S. ethanol production and livestock feeding, 3) at least moderate strength in U.S. corn
exports – driven largely by a poor harvest and lack of exportable supplies in Brazil, and 4) the possibility of
broader U.S. and Foreign economic and financial system disruptions impacting grain, energy, and other
commodity markets – such as unanticipated U.S. financial policy announcements by the U.S. Federal Reserve
affecting U.S. interest rates, or geo‐political events that could “shock” World energy markets.
USDA Supply‐Demand Forecast for “New Crop” MY 2016/17: With USDA projections of 2016 U.S. corn
plantings of 94.148 ma (up 6.149 ma from 2015), harvested acres of 86.550 ma (up 5.801 ma from 2015),
record high projected yields of 175.1 bu/ac (vs 168.4 bu/ac in 2015 and the current record high of 171.0 bu/ac
in 2014), 2016 U.S. corn production is forecast to be a record high 15.153 bb – up from 13.601 bb in 2015, the
current record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “new crop” MY 2016/17 total supplies of 16.909 bb (record high), total use of 14.500 bb (record
high), and projected ending stocks of 2.409 bb (16.61% S/U) – up from 1.706 bb (12.46% S/U) in “old crop” MY
2015/16 and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the
USDA to be in the range of $2.85‐$3.45 (midpoint = $3.15 /bu) – being down from the $3.60 /bu midpoint
estimate for “current” MY 2015/16. This scenario is given a 20% likelihood of occurring by KSU.
KSU Forecasts for “New Crop” MY 2016/17: Three alternative KSU‐Scenarios for U.S. corn supply‐demand and
prices are presented for “new crop” MY 2016/17, with each assuming a lower U.S. corn yields and production
than the August 12th USDA WASDE report.
Page | 2
KSU Scenario A) “Minor Crop Problems – 14.9 bb” Scenario (35% probability) assumes: 94.148 ma planted,
86.550 ma harvested, 172.0 bu/ac yield, 14.887 bb production, 16.743 bb total supplies, 14.450 bb total use,
2.293 bb ending stocks, 15.87% S/U, & $3.25 /bu U.S. corn average price for “new crop” MY 2016/17;
KSU Scenario B) “Moderate Crop Problems – 14.5 bb” Scenario (35% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 168.0 bu/ac yield, 14.540 bb production, 16.396 bb total supplies, 14.344 bb
total use, 2.052 bb ending stocks, 14.31% S/U, & $3.45 /bu U.S. corn average price for “new crop” MY
2016/17;
KSU Scenario C) “More Serious Crop Problems – 14.2 bb” Scenario (10% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 164.0 bu/ac yield, 14.194 bb production, 16.137 bb total supplies, 14.239 bb
total use, 1.898 bb ending stocks, 13.33% S/U, & $3.60 /bu U.S. corn average price for “new crop” MY
2016/17;
World Corn Supply‐Demand: World corn production of 1,028.4 million metric tons (mmt) is projected for “new
crop” MY 2016/17, up from 959.7 mmt in “old crop” MY 2015/16, and up from 1,013.6 mmt in MY 2014/15.
World corn total supplies of 1,237.7 mmt are projected for “new crop” MY 2016/17, up from 1,170.0 mmt in
“old crop” MY 2015/16, and up from 1,188.9 mmt in MY 2014/15. World corn exports of 137.25 mmt are
projected for “new crop” MY 2016/17, up from 119.7 mmt in “old crop” MY 2015/16, but down from 141.7
mmt in MY 2014/15. Projected World corn ending stocks of 220.8 mmt (21.7% S/U) in “new crop” MY 2016/17
are up from 209.3 mmt (21.9% S/U) in “old crop” MY 2015/16, and from 208.3 mmt (21.2% S/U) in MY
2014/15.
Brazilian corn production in MY 2015/16 (produced in early‐mid 2016) is estimated to be 68.5 mmt, down 16.5
mmt (down 19.5%) from MY 2014/15. This shortfall in Brazilian corn production in 2016 has provided some
support for U.S. corn exports and even ethanol production (via exports). But expectations of a record large
2016 U.S. corn crop have had a predominant negative impact on U.S. corn prices. Brazilian corn production is
forecast by the USDA to rebound back to 80 mmt in MY 2016/17 (2017 production).
…
September 22, 2016
Grain Market Outlook
est, 2) anticipation of continued strong use of carryover 2015 and new 2016
crop U.S. corn in domestic U.S. ethanol production and livestock feeding, 3) at least moderate strength in U.S.
corn exports – driven largely by a poor harvest and lack of exportable supplies in Brazil in 2016, and 4) the
possibility of broader U.S. and Foreign economic and/or financial system disruptions impacting grain, energy,
and other commodity markets. For example, unanticipated U.S. financial policy announcements by the U.S.
Federal Reserve could affect U.S. interest rates, or geo‐political events could occur that would “shock” World
energy and grain markets.
USDA Supply‐Demand Forecast for “New Crop” MY 2016/17: With USDA projections of 2016 U.S. corn
plantings of 94.148 ma (up 6.149 ma from 2015), harvested acres of 86.550 ma (up 5.801 ma from 2015),
record high projected yields of 174.4 bu/ac (vs 168.4 bu/ac in 2015 and the current record high of 171.0 bu/ac
in 2014), 2016 U.S. corn production is forecast to be a record high 15.093 bb – up from 13.601 bb in 2015, the
current record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “new crop” MY 2016/17 total supplies of 16.859 bb (record high), total use of 14.475 bb (record
high), and projected ending stocks of 2.384 bb (16.47% S/U) – up from 1.716 bb (12.54% S/U) in “old crop” MY
2015/16 and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the
USDA to be in the range of $2.90‐$3.50 (midpoint = $3.20 /bu) – being down from $3.60 /bu for “old crop” MY
2015/16. This scenario is given a 50% likelihood of occurring by KSU Extension Ag Economist D. O’Brien.
KSU Forecasts for “New Crop” MY 2016/17: Three alternative KSU‐Scenarios for U.S. corn supply‐demand and
prices are presented for “new crop” MY 2016/17, with each assuming a lower U.S. corn yields and production
than the September 12th USDA WASDE report.
Page | 2
KSU Scenario A) “Minor Crop Problems – 14.9 bb” Scenario (30% probability) assumes: 94.148 ma planted,
86.550 ma harvested, 172.0 bu/ac yield, 14.887 bb production, 16.653 bb total supplies, 14.450 bb total use,
2.203 bb ending stocks, 15.25% S/U, & $3.35 /bu U.S. corn average price for “new crop” MY 2016/17;
KSU Scenario B) “Moderate Crop Problems – 14.5 bb” Scenario (35% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 168.0 bu/ac yield, 14.540 bb production, 16.306 bb total supplies, 14.344 bb
total use, 1.962 bb ending stocks, 13.68% S/U, & $3.50 /bu U.S. corn avg. price for “new crop” MY 2016/17;
KSU Scenario C) “More Serious Crop Problems – 14.2 bb” Scenario (10% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 164.0 bu/ac yield, 14.194 bb production, 15.190 bb total supplies, 14.239 bb
total use, 1.721 bb ending stocks, 12.09% S/U, & $3.80 /bu U.S. corn avg. price for “new crop” MY 2016/17;
World Corn Supply‐Demand: World corn production of 1,026.6 million metric tons (mmt) is projected for “new
crop” MY 2016/17, up from 959.0 mmt in “old crop” MY 2015/16, and up from 1,013.6 mmt in MY 2014/15.
World corn total supplies of 1,235.9 mmt are projected for “new crop” MY 2016/17, up from 1,167.3 mmt in
“old crop” MY 2015/16, and up from 1,188.9 mmt in MY 2014/15. World corn exports of 139.8 mmt are
projected for “new crop” MY 2016/17, up from 119.2 mmt in “old crop” MY 2015/16, but down from 141.7
mmt in MY 2014/15. Projected World corn ending stocks of 219.5 mmt (21.6% S/U) in “new crop” MY 2016/17
are up from 209.25 mmt (21.8% S/U) in “old crop” MY 2015/16, and from 208.3 mmt (21.2% S/U) in MY
2014/15.
Brazil corn production in “old crop” MY 2015/16 (1st crop harvested in January‐May 2016, 2nd crop harvested
in May‐August) is estimated to be 67.0 mmt, down 18.0 mmt (down 21.2%) from 85.0 mmt in MY 2014/15.
This shortfall in Brazilian corn production in 2016 has provided some support for U.S. corn exports and even
ethanol production (via exports). But expectations of a record large 2016 U.S. corn crop have had a
predominant negative impact on U.S. corn market prices to date. Brazilian corn production is forecast by the
USDA to rebound back to 82.5 mmt in MY 2016/17 (2017 production).
China corn production in “new crop” MY 2016/17 (harvested in September‐October 2016) is estimated to be
216.0 mmt, down 8.6 mmt (down 3.8%) from 224.6 mmt in MY 2015/16, but marginally higher than 215.65
mmt in MY 2014/15. Most of the focus in World corn markets is on Chinese ending stocks. Ending stocks of
corn in China are projected to be 103.65 mmt (45.9% SU) in “new crop” MY 2016/17, down from 110.7 mmt
(50.9% S/U) in “old crop” MY 2015/16, but up from 110.5 mmt (49.7% S/U) in MY 2014/15.
…
October 19, 2016
Grain Market Outlook
ipation of continued strong use of “new crop” 2016 U.S. corn in
domestic U.S. ethanol production and livestock feeding, 3) at least moderate strength in U.S. corn exports –
driven partly by a poor harvest and lack of exportable supplies in Brazil in 2016 as well as other World corn
market factors, and 4) the always present possibility of broader U.S. and Foreign economic and/or financial
system disruptions impacting grain, energy, and other commodity markets in later 2016 and 2017.
For example, unanticipated U.S. financial policy announcements by the U.S. Federal Reserve could affect U.S.
interest rates which could affect U.S. corn exports. Also, World geo‐political events could provide an
unanticipated “shock” to U.S. and World energy and grain markets – with the impact on the direction of U.S.
and World corn markets being difficult to anticipate.
USDA Supply‐Demand Forecast for “New Crop” MY 2016/17: With USDA projections of 2016 U.S. corn
plantings of 94.490 ma (up 6.491 ma from 2015), harvested acres of 86.836 ma (up 6.087 ma from 2015),
record high projected yields of 173.4 bu/ac (vs 168.4 bu/ac in 2015 and the previous record high of 171.0
bu/ac in 2014), 2016 U.S. corn production is forecast to be a record high 15.057 bb – up from 13.601 bb in
2015, the current record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “new crop” MY 2016/17 total supplies of 16.845 bb (record high), total use of 14.525 bb (record
high), and projected ending stocks of 2.320 bb (15.97% S/U) – up from 1.738 bb (12.72% S/U) in “old crop” MY
2015/16 and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the
USDA to be in the range of $2.95‐$3.55 (midpoint = $3.25 /bu) – being down from $3.61 /bu for “old crop” MY
2015/16. This scenario is given a 70% likelihood of occurring by KSU Extension Ag Economist D. O’Brien.
Page | 2
Alternative KSU Forecasts for “New Crop” MY 2016/17: Two alternative KSU‐Scenarios for U.S. corn supply‐
demand and prices are presented for “new crop” MY 2016/17, each gauging the likelihood of lower U.S. corn
yields and production than projected by the USDA in the October 12th USDA WASDE report.
KSU Scenario A) “172.5 bu/ac – 14.979 bb” Scenario (25% probability) assumes: 94.490 ma planted, 86.836
ma harvested, 172.5 bu/ac yield, 14.979 bb production, 16.717 bb total supplies, 14.525 bb total use, 2.192 bb
ending stocks, 15.09% S/U, & $3.35 /bu U.S. corn average price for “new crop” MY 2016/17;
KSU Scenario B) “171.0 bu/ac – 14.849 bb” Scenario (5% probability) assumes: 94.490 ma planted, 86.836 ma
harvested, 171.0 bu/ac yield, 14.849 bb production, 16.637 bb total supplies, 14.525 bb total use, 2.112 bb
ending stocks, 14.54% S/U, & $3.45 /bu U.S. corn average price for “new crop” MY 2016/17;
World Corn Supply‐Demand: Record high World corn production of 1,025.7 million metric tons (mmt) is
projected for “new crop” MY 2016/17, up from 959.1 mmt in “old crop” MY 2015/16, and up from 1,014.4
mmt in MY 2014/15.
Record high World corn total supplies of 1,235.7 mmt are projected for “new crop” MY 2016/17, up from
1,168.1 mmt in “old crop” MY 2015/16, and from 1,189.7 mmt in MY 2014/15. World corn exports of 143.8
mmt are projected for “new crop” MY 2016/17, up from 119.5 mmt in “old crop” MY 2015/16, and from 141.7
mmt in MY 2014/15. Projected World corn ending stocks of 216.8 mmt (21.3% S/U) in “new crop” MY 2016/17
are up from 210.9 mmt (21.9% S/U) in “old crop” MY 2015/16, and from 208.9 mmt (21.3% S/U) in MY
2014/15. Although World corn ending stocks are projected to be a record high in “new crop” MY 2016/17 at
216.8 mmt, World corn percent ending stocks‐to‐use in “new crop” MY 2016/17 are forecast to actually
decline to 21.3% ‐ indicative of expected continued strong World demand for corn at low prices – especially in
Europe where grain production has been hampered by extreme weather conditions.
Brazil corn production in “old crop” MY 2015/16 (1st crop harvested in January‐May 2016, 2nd crop harvested
in May‐August) is estimated to be 67.0 mmt, down 18.0 mmt (down 21.2%) from 85.0 mmt in MY 2014/15.
This shortfall in Brazilian corn production in 2016 has provided support for U.S. corn exports and even ethanol
production (via exports). However, expectations of a record large 2016 U.S. corn crop have had a predominant
negative impact on U.S. corn market prices through late summer and early fall. Brazilian corn production is
forecast by the USDA to rebound back to 83.5 mmt in MY 2016/17 (2017 production). Uncertainty about
Brazilian corn production prospects in 2017 could be a major factor impacting U.S. and World corn prices in the
coming spring and summer months of 2017.
China corn production in “new crop” MY 2016/17 (harvested in September‐October 2016) is estimated to be
216.0 mmt, down 8.6 mmt (down 3.8%) from 224.6 mmt in MY 2015/16, but marginally higher than 215.65
mmt in MY 2014/15. A major focus in World corn markets is on the size of Chinese ending stocks and on
recent changes in China’s domestic corn stock management policies. Ending stocks of corn in China are
projected to be 103.7 mmt (45.9% SU) in “new crop” MY 2016/17, down from 110.7 mmt (50.9% S/U) in “old
crop” MY 2015/16, but up from 100.5 mmt (49.7% S/U) in MY 2014/15. Over the last three marketing years,
percent ending stocks‐to‐use of corn for China ranging from 49.7% to 50.9% are the highest since MY 2002/03
(51.6%). During the interim MY 2003/04 to MY 2013/14 period, Chinese corn percent ending stocks‐to‐use
averaged 30.5%, ranging from 25.2% to 39.1%.
…