Commodity Market Outlook Todd Hubbs jhubbs3@Illinois.edu - PowerPoint PPT Presentation

Commodity Market Outlook Todd Hubbs jhubbs3@Illinois.edu Department of Agricultural and Consumer Economics University of Illinois www.farmdocdaily.illinois.edu www.farmdoc.illinois.edu

U.S. Corn Supply and Use 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 USDA Est. USDA Forecast Area Planted (mil. Acres) 95.4 90.6 88 94.0 90.2 89.1 Area Harvested (mil. Acres) 87.5 83.1 80.8 86.7 82.7 81.8 Yield (Bu./acre) 158.1 171 168.4 174.6 176.6 178.9 Production (mil. Bu.) 13,829 14,216 13,602 15,148 14,604 14,626 Imports (mil. Bu.) 36 32 67 57 36 50 Total Supply (mil. Bu.) 14,686 15,479 15,401 16,942 16,934 16,816 Feed and Residual (mil. Bu.) 5,002 5,284 5,113 5,472 5,298 5,500 Food, Seed, and Industrial (mil. Bu.) 6,493 6,601 6,643 6,883 7,058 7,130 Ethanol (mil. Bu.) 5,124 5,200 5,224 5,432 5,605 5,650 Exports (mil. Bu.) 1,920 1,867 1,901 2,293 2,438 2,450 Total Use (mil. Bu.) 13,454 13,748 13,664 14,649 14,793 15,080 Ending Stocks (mil. Bu.) 1,232 1,731 1,737 2,293 2,140 1,736 Season Average Price ($ per Bu.) $4.46 $3.70 $3.61 $3.36 $3.36 $3.20 - $4.00

U.S. Feed and Residual Use and Grain Consuming Animal Units 6,500 105 6,132 6,111 6,000 5,845 5,853 5,819 5,778 100 5,545 5,535 5,500 5,470 5,500 5,286 5,298 Million Animal Units 5,128 5,118 Millions of Bushels 5,096 5,002 95 5,000 4,770 4,512 4,500 4,309 90 4,000 85 3,500 3,000 80 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Feed and Residual Use Grain Consuming Animal Units Data: NASS

U.S. Corn Used for Ethanol 6000 5,650 5,605 5,432 5,224 5,200 5,124 5,019 5,000 5000 4,641 4,591 4000 Millions of Bushels 3,709 3,049 3000 2,119 2000 1,603 1,323 1,168 996 1000 707 630 0 Data: WASDE

U.S Ethanol Exports by Marketing Year 1,800 1,600 1,400 1,200 Millions of Gallons 1,000 800 600 400 200 0 World Brazil Canada China India South Korea Mexico Netherlands Peru Phillippines 2013-14 2014-15 2015-16 2016-17 2017-18 Data: EIA

U.S. Corn Exports 3,000 2,450 2,437 2,438 2,500 2,294 2,134 2,125 1,979 2,000 1,921 1,899 1,867 1,849 1,831 Millions of Bushels 1,539 1,500 1,000 730 500 0 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 World Mexico Japan South Korea Columbia Data: FAS GATS

U.S. Corn Stocks to Use Ratio and Average Farm Price 25% $8 $7 20% $6 $5 Dollars per Bushel 15% Percent $4 10% $3 $2 5% $1 0% $0 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Corn Stocks to Use Ratio Weighted Avg. Farm Price Data: WASDE

Corn Production 16 15.1 14.6 14.6 14.2 13.8 14 13.6 12.4 12.3 12 10.8 Billion of Bushels 10 8 6 3.9 3.7 4 3.3 3.3 3.2 3.1 2.9 2.6 2.3 2.0 1.9 1.9 1.7 2 1.7 1.7 1.6 1.6 1.3 1.3 1.3 1.2 1.2 1.1 1.0 1.0 0.8 0.7 0 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 United States Brazil Argentina FSU - 12 Data: NASS

U.S. Average Corn Yield 200 2018 Yield Projection = 178.9 bpa 180 160 140 Bushels per Acre 120 100 80 y = 1.8749t + 59.275 R² = 0.9079 60 40 20 0 Data: NASS

U.S. Corn Acreage 100,000 95,000 89,128 90,000 85,000 Planted Thousand Acres 80,000 75,000 70,000 Harvested 65,000 60,000 Data: NASS

Corn Balance Sheet 2018-19 2018-19 2019-20 Current USDA Forecast Forecast Forecast Supply: Planted Acreage (million acres) 89.1 89.1 91.8 Harvested Acreage (million acres) 81.8 81.8 84.5 Yield (Bushels / Acre) 178.9 177.6 174.2 Total Production(million bushels) 14,626 14,528 14,720 Beginning Stocks(million bushels) 2,140 2,140 1,768 Imports (million bushels) 50 40 40 Total Supply (million bushels) 16,816 16,708 16,528 Consumption: Feed and Residual (million bushels) 5,500 5,450 5,400 Food, Seed, and Industrial (million bushels) 7,130 7,100 7,090 Ethanol (million bushels) 5,650 5,620 5,600 Exports (million bushels) 2,450 2,390 2,275 Total Consumption (million bushels) 15,080 14,940 14,765 Ending Stocks (million bushels) 1,736 1,768 1,763 Ending Stocks/Total Consumption (%) 11.5% 11.8% 11.9% Average Price ($/bu.) $3.60 $3.70 $3.65

U.S. Soybean Supply and Use 2013/14 2014/15 2015/16 2016/17 2017/18 USDA 2018/19 USDA Estimate Forecast Area Planted (mil. Acres) 76.8 83.3 82.7 83.4 90.1 89.1 Area Harvested (mil. Acres) 76.3 82.6 81.7 82.7 89.5 88.3 Yield (Bu./acre) 44 47.5 48 52.0 49.3 52.1 (mil. Bu.) 3,358 3,927 3,296 4,296 4,411 4,600 Production Imports (mil. Bu.) 72 33 24 22 22 25 Total Supply (mil. Bu.) 3,570 4,052 4,140 4,515 4,734 5,063 Crush (mil. Bu.) 1,734 1,873 1,886 1,901 2,055 2,080 Seed and Residual (mil. Bu.) 107 146 122 146 122 128 Exports (mil. Bu.) 1,638 1,842 1,936 2,166 2,129 1,900 Total Use (mil. Bu.) 3,478 3,862 3,944 4,214 4,296 4,107 Ending Stocks (mil. Bu.) 92 191 197 302 438 955 Season Average Price ($ per Bu.) $13.00 $10.10 $8.95 $9.47 $9.33 $7.60 - $9.60

U.S. Soybean Crush 2,200 2,080 2,055 2,000 1,901 1,886 1,873 1,808 1,803 1,800 1,752 1,739 1,734 Millions of Bushels 1,703 1,700 1,696 1,689 1,662 1,648 1,640 1,615 1,600 1,530 1,400 1,200 1,000 Data: WASDE

U.S. Soybean Exports 2,500 2,166 2,129 1,942 2,000 1,900 1,842 1,639 Million Bushels 1,505 1,499 1,500 1,366 1,328 1,279 1,159 1,116 1,097 1,064 1,044 996 940 1,000 887 500 0 U.S. Soybean Exports China Mexico Japan Data: FAS GATS

China Soybean Imports 4,000 3,454 3,436 3,500 3,307 3,058 3,000 2,879 Millions of Bushels 2,535 2,500 2,200 2,113 1,923 2,000 1,819 1,510 1,500 1,390 1,056 1,041 948 1,000 787 622 487 500 382 0 Data: FAS

2018 Daily Soybean Export Prices for Paranagua Brazil and New Orleans Data: CEPES and AMS

Brazil and U.S. Monthly Exports 500 450 400 350 Millions of Bushels 300 250 200 150 100 50 0 Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug U.S. 5-Year Avg. U.S. 2017-18 U.S. 2018-19 Brazil 5-Year Avg. Brazil 2017-18 Brazil 2018-19 Data: COMEX VIS and FAS

U.S. Soybean Stocks to Use Ratio and Average Farm Price 25% $16 $14 20% $12 $10 Dollars per Bushel 15% Percent $8 10% $6 $4 5% $2 0% $0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 U.S. Soybean Stocks to Use Ratio Avg. Farm Price Data: WASDE

Soybean Production 5.0 4.6 4.4 4.5 4.4 4.4 4.3 4.2 3.9 3.9 4.0 3.6 3.5 3.5 3.4 3.4 3.3 Billions of Bushels 3.2 3.2 3.1 3.1 3.0 3.0 3.0 3.0 2.8 2.7 2.5 2.4 2.5 2.3 2.2 2.2 2.1 2.1 2.1 2.1 2.1 2.0 2.0 2.0 1.8 1.8 1.8 1.7 1.5 1.5 1.5 1.4 1.2 1.0 0.5 0.0 United States Brazil Argentina Data: NASS

U.S. Soybean Average Yield 60 Current USDA Forecast= 52.1 bpa 50 Bushels per Acre 40 30 20 y = 0.0039t 2 + 0.1989t + 23.618 R² = 0.9079 10 0 Data: NASS

U.S. Soybean Acreage 95,000 89,145 90,000 85,000 Thousands of Acres 80,000 Planted 75,000 70,000 Harvested 65,000 60,000 55,000 50,000 Data: NASS

2018-19 Soybean Balance Sheet Current USDA 2018-19 2019-20 Forecast Forecast Forecast Supply: Planted Acreage (mil.) 89.1 89.1 85.7 Harvested Acreage (mil.) 88.3 88.3 84.9 Yield (bu./ac.) 52.1 51.8 49.2 Production (mil. bu.) 4,600 4,574 4,177 Beginning stocks (mil. bu.) 438 438 929 Imports (mil. bu.) 25 25 25 Total Supply (mil. bu.) 5,063 5,037 5,131 Consumption: Crush (mil. bu.) 2,080 2,070 2,055 Export (mil. bu.) 1,900 1,910 1,930 Seed and feed (mil. bu.) 128 128 124 Total Consumption(mil. bu.) 4,107 4,108 4,109 Ending stocks (mil. bu.) 955 929 1,022 Stocks-to-use 23.3% 22.6% 24.8% Average farm price ($/bu.) $8.60 $8.50 $8.40