PINOYAGRIBUSINESS

LIVESTOCKS => AGRI-NEWS => Topic started by: mikey on September 30, 2008, 10:17:28 AM

Title: Corn & Seed/Oil Commodities
Post by: mikey on September 30, 2008, 10:17:28 AM
Corn : This Accounting Graduate Finds a Niche in Farming
Crispina “Tayan” Leonocito of Carmen, North Cotabato, 44, was an accounting clerk at her town ’s local government unit before she joined her husband in Subic, Olangapo, Zambales where he was a naval architect at the U.S. Naval Base.

However, soon after the Americans returned the naval base to the Philippines she went back to Carmen where farming beckoned her interest when 4 hectares (ha) of corn land were mortgaged to her in 1992. With P40,000 borrowed from her brother-in-law, she started farming while at the same time engaging in small-scale farm financing, providing production loans to corn farmers.

Tayan said that although she was using a bicycle as her service vehicle to get to her borrowers, her business was making good. After seven months, she was able to return the money she borrowed. A year later, she bought a 2.4-hectare farm lot, then a tractor, and then a jeep.

As if farming and farm financing were really made for her, Tayan soon found that the farmers were already selling their farms to her. It did not take long for her farm to reach 20 ha, which she planted to corn. Later, she expanded to sugarcane production.

After being able to buy a cargo truck for hauling canes from the farms to the sugar central, she eventually started to buy standing canes several months before harvest. This venture enabled her to buy more farms from sugarcane growers.

Not yet contented with her progress in her earlier ventures, Tayan even planted 5 ha with mango starting in 2001. The first hectare started to bear fruits last season. Harvesting was made twice. The first harvest of 3,000 kilograms (kg) was sold at P23/kg for P69,000. This was followed by 3,300 kg, which was sold at P21/kg for P69,300. All in all, her gross sale from the first hectare was P 138,300.

Tayan has also ventured into rubber production and planted 30 ha to this crop.

CORN FARMING
Right now, Tayan is producing corn in 44 ha, and 38 ha of which belongs to her while the rest were mortgaged to her.

She has been planting the Bioseed corn hybrids like Bioseed 9900, Bioseed 9901 and Bioseed 9890 for several years now, and she immediately adopted the newest variety of Bioseed Research Philippines, Bioseed 9909, as soon as it was introduced last year.

She planted 2.2 ha with the new variety and harvested 359 bags in cobs. At a shelling percentage of 48 percent, she got 172 bags of dried, shelled corn weighing 15, 480 kg. This means that she harvested an average 7,036 kg a hectare.

“You would be fascinated with the corn plants if you saw them growing,” Tayan said.

She added that the ears became bigger and the grains heavier with the application of the bio-organic fertilizer Durabloom, which she has been using continuously for four years already. This is especially true during the dry season.

Buyers classify the grains as Class A and she gets an additional incentive of P0.05 a kilo over the current price. With 15,480 kg, she gets an additional income of P774.

Contrary to the recommendation of Novatech Agri-Food Industries that Durabloom be applied during planting Tayan applies this bio-organic fertilizer as sidedressing at 21 to 25 days after planting, using a mechanical applicator before hilling up. She applies 10 bags per hectare.

This has been her practice since Durabloom was introduced to her and other Carmen farmers in a seminar by Dr. Rene Sumaoang, Novatech president and CEO. Tayan said she already saw an increase in her corn yield on the first crop applied with Durabloom -and, hence, has continued to use it.

In the past, Tayan was also providing production loans to farmers in the form of Bioseed corn seeds and other inputs for 1,000 ha (1 bag/ha) and was buying the harvest herself However, she is now limited to 100 ha because she has diversified to mango, sugarcane and rubber production.

She also uses Durabloom as fertilizer for her mango trees and sugarcane, which
now cover 13 ha.

With Durabloom fertilization, the mango fruits are big with an average weight of 600 grams each, she said.

With the way things only gave us a wide smile when we asked her if she ever gets tired with so many ventures on her hands. This is understandable, of course, since aside from the lands she has already accumulated, she seems to have almost everything she needs - six farm tractors, three 10-wheeler cargo trucks, a Forward and two Elf cargo trucks, a corn sheller - for her operations.

Now who would like to be employed as an accounting clerk with a meager salary if one’s income from farming and related ventures are as good as that of Tayan?

Title: Re: Corn:
Post by: mikey on November 20, 2008, 08:17:00 AM
The Philippines is ready to become a corn exporter for the first time as local corn farmers entered into a supply agreement for 300,000 tonnes with Korea Overseas Grains Investment Co. Philippine Maize Federation Inc (Philmaize) President Roger Navarro said that while negotiations have been ongoing and both parties are still negotiating the price of the shipment, which is tentatively set at PHP 16 (USD 0.34)/kg. Mr Navarro said Philmaize started exploring export markets following the government's policy on support programs for the corn sector. In August, corn farmers asked the National Food Authority (NFA) to increase the support price for corn to PHP 13 (USD 0.28)/kg, but the NFA pegged the price at only PHP 10 (USD 0.21)/kg.
Title: Re: Corn:
Post by: mikey on December 05, 2008, 12:12:54 AM
Best Management Practices for Corn-after-Corn Production
Talking to many farmers across the country, I found that majority of them had been planting corn in the same land twice a year for as long as they can remember. They plant corn during the wet season, just before the dry season starts, and plant another round - which they call “palusot” - to take advantage of sufficient rains and dry periods at harvest. And so the cropping cycle goes on. This is especially true in Cagayan Valley and Mindanao where growing conditions are tough, but because of the recent advances in hybrid corn technology things have become manageable.

Corn uses less water than rice, can be grown on a wide range of soil types, and can adapt to various planting methods. There are plenty of hybrid varieties to choose from and there is a steadily growing market for feeds. Corn grains are durables (in contrast to “perishable” fruits and vegetables) so rushing these grains to end-users is not an issue after proper drying and storage. In short, who would not want to plant corn continuously? With these factors, even Ilocos and Central Luzon growers (corn-after-rice) would want to plant corn all year long if not for the severe monsoon rains which occur from July to September that will surely submerge their low-lying fields. In the Visayas and in Bicol, they make sure to plant only on well-drained soils or on rolling fields.
There is, indeed, an economic advantage for growing corn non-stop but we should be aware that we also put some strain or stress on the farm we till. This article would address best practices for corn-after-corn production practices with emphasis on hybrid selection, high crop residue challenges related to diseases, soil fertility, and weed management.

HYBRID SELECTION
Selecting the right hybrid is an internal part of a successful corn-after-corn production. A corn grower should always ensure to
• Select hybrids with proven performance under diverse environments and stresses their field may encounter;
• Select hybrids with above average drought tolerance. Under corn-after-corn system, root mass may be reduced and such may not prepare the corn plant for limited water conditions;
• Select the right hybrid maturities that match corn plantings dates and forecasted climatic conditions. If drought is expected, it is wise to use early maturing hybrids; and
• Choose the highest performing genetics with the defensive traits required for this production system.

For better understanding of these traits, seek the assistance of your Pioneer agronomist in selecting hybrids for corn-after-corn.

CROP RESIDUE AND DISEASES
In cropping systems where great amounts of residue are left in the soil surface, corn diseases may become an issue. Pathogens or microbes survive in corn residue and disease builds up over time. This is especially true in the disease-prone areas of Mindanao, Panay, and Bicol. Sometimes, planting too early in a high-residue seedbed can increase the chances of corn seedling diseases (seedling blight, for example). This can be avoided through strip tillage or removal of the residues from the rows.

Leaf diseases such as gray leaf spot, northern leaf blight, and diplodia leaf blight are known to have increased in Mindanao due to long-term, high-residue farming. This could also be possible in the cool areas of Panay and Bicol where corn-after-corn had become an acceptable farming practice. Stalk and ear rots such as Gibberella, Diplodia, Fusarium, and Aspergillus also survive in crop residue and increase in high-residue systems. Burying (or plowing under) crop residue by tillage may be an option but all growers should select hybrids with good disease resistance and standability. Often times, stalk rots accompany leaf diseases so monitoring stalk quality and timely harvest is helpful when leaf diseases occur. The practice of manual ear-picking here in the Philippines becomes more expensive on fields with severe lodging brought about by diseases.

If ear rots are found, late-season scouting can help growers make informed decisions about harvest timing, postharvest, grain handling, and storage and utilization. For example, grains with significant ear rot symptoms from the field should be dried quickly to 15 percent or less at high temperature. The lower the moisture content in storage, the lower the risk of mycotoxin(amag) development

SOIL FERTILITY AND NITROGEN
In corn-after-corn, many farmers are not aware of the value of thorough soil testing and the availability of local nutrient recommendations coming from LGUs and seed companies. Soil tests are needed to measure soil pH (acidity or alkalinity, not lower than pH 5.5), organic matter content (nitrogen), phosphorus (P), and potassium (K). A balanced level of P and K applied as basal can improve efficiency in nutrient uptake.

Unlike legumes (or beans), corn residues tie up much more nitrogen as they decompose in the soil. This is why using the same level of N fertilizer in the succeeding season of corn after corn system does not really bring any additional yield. Not unless growers increase their N rates by 40kg to 50kg N/ha. It really pays to have a soil test or obtain local recommendations. Recent US studies however, revealed that regardless of N levels, corn-after-corn never equalled a corn rotated to soybeans.

WEED MANAGEMENT
Watching out for weeds is a more important issue among corn-after-corn systems as compared to corn-after-rice. In Central Luzon, farmers have attested that weeds are more problematic in their off-season crop than corn following their rice crop in the wet season. Hence, growers should monitor fields for any increase in specific weed pressure and employ proper control especially among glyphosate-ready (RR corn) fields. Alternating use of herbicide mode of action and use of mixtures will help ensure long term success of weed management and prevent weed shifts or weed resistance. Watch out for volunteer plants also. These are plants that have emerged from ears or brains left in the field after harvest. Farmers should then strive to reduce stalk breakage and ear drop.

ROTATION EFFECT AND STRESS
The so-called “rotation effect” is an unexplained benefit that results in better yields with crop rotation, even though the limiting factors are being addressed in continuous cropping. Where yield potential is low, yield reductions become greater for corn-after-corn vs. rotated corn cycle. Such observations led to the idea that generally, crop rotation renders the corn more tolerant to yield limiting stresses, in particular to moisture extremes. Experts implicate the root system as the most likely source of the problem. In corn-after-corn systems, soil compaction can be one likely cause but it could also be more of neglect on the part of the grower. A vast majority of our growers do not have access to soil testing or simply unaware that it is absolutely necessary for the sustainability of their valuable resource.

MANAGEMENT SUGGESTIONS FOR CORN-AFTER-CORN
• Choose fields that are best-suited for corn-after-corn system. Fields should have good drainage, medium-textured soils with ample water holding capacity, and adequate P and K levels.
• Manage corn borers using Pioneer 30T80, 30Y80, 30T35, 30Y34, and 30T44. Your local Pioneer agronomists and sales representative will gladly assist you in choosing which is best-suited in your area.
• Select hybrids with appropriate maturities to suit your needs. Early maturing hybrids will always have an advantage.
• Manage nitrogen carefully. A combination of N during basal and side dress applications may help limit effects of N losses due to leaching and denitrification in wet periods.
• Walk in the field regularly and monitor to identify any problems early. Look for stand count issues, nitrogen shortages, insect build ups, outbreak of disease, weed problems, and effects of moisture stress.
• Monitor fields for leaf diseases and stalk and ear rots. They can be controlled by managing residues properly and selecting resistant or tolerant hybrids.
• Be diligent to prevent soil compaction on corn-after-corn fields.

FREQUENTLY ASKED QUESTIONS
Q: Do you recommend top cutting in corn, days prior to harvest or when the husks starts to dry? What are the benefits and disadvantages?
A: We do not recommend top cutting (or tadaw in Ilocano) at any ‘ reproductive stage of the crop. It has been proven that grain yield can be reduced by as much as 20 percent if tadaw is carried out at around 80 percent for a full season hybrid. Grain quality would, also deteriorate as the crop is forced to mature earlier than expected. Other than having an early harvest and a good source of forage, we don’t see any advantage in doing tadaw. For as long the grains are not yet mature, the ears are still receiving food from the upper leaves and stalks.


Title: Re: Corn:
Post by: mikey on December 05, 2008, 08:38:14 AM
YieldGard Bt Corn Much Better than Ordinary Yellow Hybrid Corn
Small corn farmers have good reasons for adopting YieldGard, the first Bt corn variety introduced in the Philippines by the multi-national company Monsanto, according to international agricultural economists and policy consultant Dr. Leonardo A. Gonzales.

After monitoring and evaluating the socio-economic impact of the Bt corn YieldGard, Dr. Gonzales said his findings show that small farmers adopt this variety due to its higher yields, cost efficiency, profitability, potential to cover household’s poverty thresholds, global competitiveness, and return on investment (ROI). .

His study covered Isabela, Camarincs Sur, Bukidnon, and South Cotabato, the four major corn-producing provinces, and was conducted in four cropping seasons from 2003 to 2005.

The favorable socio-economic impacts of YieldGard on small corn producers in. the Philippines are positive indicators that the technology will continue to be adopted by farmers in the future, Dr. Gonzales said.

HIGHER ROI
On the average, the ROI for YieldGard was higher than ordinary yellow hybrid corn by 33 percent. Although the ROI of non-Bt corn is 11 percent higher than the ROI of YieldGard at low yield levels, YieldGard had a higher ROI (31 percent) than ordinary yellow hybrid corn at high yield levels.

The study also showed that despite its relatively higher seed cost (6 percent higher), YieldGard had a higher contribution to ROI than ordinary yellow hybrid corn by 10 percent. The contribution of YieldGard seed to ROI was 28 percent, while the contribution of non-Bt hybrid corn was only 18 percent.

In his analysis, Dr. Gonzales noted that the higher ROIs of YieldGard were due to its higher yield than ordinary yellow hybrid corn. On the average, the yield of YieldGard in the four provinces in crop year 2004-2005 was 829 to 831 kg ha (kilograms per hectare) higher than non-Bt corn. Likewise, the income derived from Bt corn was P0.20 to P1.22/kg higher than from non-Bt hybrid corn.

Dr. Gonzales said that because of YieldGard’s higher yield than ordinary yellow hybrid corn, the users of YieldGard technology are more cost efficient, resulting in higher net farm incomes, which would eventually lead to higher subsistence level carrying capacity. This means that more farmers using YieIdGard corn were able to cover the family poverty threshold.

RESISTANCE TO ACB
The higher yield performance of YieldGard is due to its capacity as a genetically modified plant to resist the Asiatic corn borer (ACB) and this is because this genetically modified plant has a Bacillus thuringiensis gene.

The yield performance of YieldGard over ordinary yellow hybrid corn is accentuated with ACB infestation. Thus, the heavier the damages caused by ACB, the better would be the yield and economic performance of YieldGard over non-Bt hybrid corn.

“The economics of the Bt corn technology is centered on the presence of ACB infestation,” Dr. Gonzales said. “Under ordinary circumstances when there are no ACB infestations, YieldGard does not have a distinct competitive advantage over an ordinary hybrid corn of the same genetic background. The yield performance of YieldGard over an ordinary hybrid is therefore accentuated with the ACB infestation reflected in percent yield losses.”

South Cotabato, the province with the highest yield losses (12 to 30 percent) due to ACB infestation, also had the highest yield, farm cost efficiency, and net farm income over ordinary hybrid corn in the 2005 dry season.

In contrast, in Bukidnon where the ACB incidence was low (less than 1 percent to 6.4 percent), the performance of YieldGard over the ordinary hybrid corn was also the lowest.

EFFICIENT SUBSTITUTE
Amazingly, the findings of Dr. Gonzales indicate that it is more efficient to substitute imported corn with domestically produced YieldGard and non-Bt corn. In fact, in terms of performance ratio, YieldGard surpassed non-Bt corn by 5 percent during the 2003-2004 dry season, 1 percent in 2004-2005 wet season, and 14 percent in 2004-2005 dry season.

However, Dr. Gonzales said that although the study showed the superiority of YieldGard over non-Bt corn, the vast socio-economic potential impacts of the Bt technology have yet to be optimized. He pointed out that a large percentage of Bt corn users, have not yet produced yields greater than 4 mt/ha.

This implies that farmers have not carefully and diligently followed the package of technology requirements of YieldGard. Thus, there should be stronger extension services between the generators of the technology and farmers, and between extension agents of local government units and corn farmers.

Alternative financing schemes are also needed to ensure that small farmers adopting Bt corn, particularly the YieldGard technology, will optimize their use,-of inputs as required by the package of technology.

Dr. Gonzales added that while adoption of a new technology such as YieldGard is a good start, it is not sufficient to ensure sustained productivity. “Public investments in farm: to-market roads, extension services, postharvest facilities, and value-added processing are justifiable with the strong linkage of corn with the livestock industry and its potential linkage with the biofuels industry. Public investments in public goods within the corn supply value chain will also induce private sector investments along the same chain,” he said.

He explained further that since the five-year commercial life of YieldGard has expired last December 3, 2007, it is timely for the Bureau of Plant Industry and the generators of GM technologies to develop a mutually acceptable set of socio-economic impact indicators, and standardize the methodologies to generate them.

Title: Re: Corn:
Post by: mikey on January 17, 2009, 03:14:38 AM
Is it just me or has the price of corn just taken a big jump up??Wow

1/14/2009 7:42:00 AM


Philippine Feed Millers Insist On Importing Corn At Zero Duty
MANILA (Dow Jones)--Philippine feed millers, along with livestock and poultry raisers, reiterated Wednesday their request for the government to allow them to import up to 300,000 metric tons of corn at zero tariff amid record prices of the grain in the local market.

If approved, the request, made through a letter to Agriculture Secretary Arthur Yap, would "balance out the cost of buying local corn at a high price and importing the grain at a lower rate," said Gregorio San Diego, president of the United Broiler Raisers Association.

Local corn prices soared early this week to record levels of PHP24-PHP26 a kilogram from an average price of only PHP13.32/kg in 2008 due to tight domestic supply.

By comparison, the cost of importing corn duty free would translate to a landed price of only PHP12/kg.

The group had initially made the request in November last year amid projections of tight domestic supply by the beginning of the new year.

However, an interagency committee on rice and corn led by the agriculture department rejected the call last week and insisted that corn importers must pay the regular tariff of 35%, at which the landed cost would translate to PHP14/kg.

Renato Eleria, vice-chairman of the National Federation of Hog Farmers, Inc., said government figures on crop production have proved to be unreliable as evidenced by the fact that corn prices are high despite projections of an increase in local production.

Based on the government's latest production survey, corn output in the first three months of the year would rise 3% to 2.05 million tons, as farmers were likely to plant more due to favorable weather conditions and state subsidies on seeds and fertilizer.

In 2008, corn output rose 3% to 6.95 million tons from a year earlier.

Amid declining supply, a group of feedmillers and livestock raisers last month imported 90,000 tons of corn from Brazil. An initial volume of 55,000 tons was contracted in early December, followed by a 35,000-ton deal.

The imports are for arrival within January. The bulk of the volume was imported by food and beverage conglomerate San Miguel Corp.(SMCB.PH), which has a feed and poultry division.

Corn is a major component in livestock and poultry feed.

-By Rhea Sandique-Carlos, Dow Jones Newswires, 63-918-9014158; rhea.sandique-carlos@dowjones.com 
Title: Re: Corn:
Post by: mikey on January 17, 2009, 03:58:22 AM
Schwieterman: Corn Indicators Up, Cattle Suffer Heavy Losses

 

One of the fears that traders had coming into the first week of trading in 2009 was that we would see more Index Fund liquidation due to rebalancing. This was especially the case in the corn where large liquidation was expected to take place. So far the grain markets have done pretty well in 2009. The corn was definitely the poor performer of the week, but was only slightly lower. The livestock markets on the other hand did not fair very well and much of that weakness may be attributed to Index fund liquidation. When we get next week’s Commitment of Traders report, we should be able to see if that was the

case or not.

 

Monday we have a number of reports out so we will be inundated with fresh fundamental information. We have the “final” production figures for 2008, the supply and demand report, winter wheat seedings, and the quarterly stocks report.

 

The corn numbers will probably be neutral to negative with the possibility for lower production, but also for lower exports again. We will probably end up with a higher ending stocks figure because we just can’t get demand back on track.

 

The wheat numbers should be friendly. There is the potential for lower ending stocks due to higher exports and winter wheat acreage is expected to be lower than last year. Last year’s acreage was the highest in about 10 years and this year we should be around 44 million acres, which is still above 2005 and 2006, but is still low by historical standards.

 

The soybean data will likely be neutral to friendly. We should see a cut in production and an increase in exports, but some of that will be offset by a cut in the crush estimate.

 

CORN:

Trend: Short Term Up – Long Term Up

Sentiment: Technical traders are buying.

 

The corn was sideways this week. We saw flashes of strong buying and also selling pressure. The net result was a 1 ½ cent loss.

 

The technical outlook for the market is still positive. Many long term trend indicators have turned up and the market is not particularly overbought. We have been in a choppy, sideways/higher pattern for a month and that looks like it will continue. There still appears to be a strong possibility that the March corn moves to the $5.00 area and possibly farther if we see better demand figures. That leads us to the negative part of the market, which is the fundamental outlook. Demand is still a problem. There are concerns about exports, feed usage, and ethanol usage many of which stem from uncertainty about the world economy as a whole. Fertilizer prices have dropped, which means it is less likely that acreage drops this spring. We need to see demand increase over the next 18 months to avoid having excessive ending stocks. The bright side of having the large stocks is that we are proving we can support the ethanol industry without creating shortages of corn. However, it would be nice if things were a little tighter than they are for the sake of prices.

 

Action: Trend indictors are still up so I like buying $4.50 - $5.50 Bull call spreads in the July corn to replace sales. For those interested in hedging new crop bushels, if you use futures I like selling out of the money put options to collect premium and to help ease the pain of potential margin calls.

 

WHEAT:

Trend: Short Term Up – Long Term Up

Sentiment: Another positive week.

 

The wheat market faired pretty well this week. The March KW finished the week in the middle of the weekly trading range and up about 18 cents from last Friday. Like the corn, the technical outlook for the market is friendly. We are still a long way from reaching a 38% retracement of the whole move down. A 38% retracement of the move down from the August high would take the March KW close to $7.00. In other words, the wheat, from a technical stand point still has good upside potential.

 

Fundamentally, the wheat is in better shape than the corn. Acreage is expected to be lower. The export pace has, for the most part, been more than adequate. Plus, and I know I have talked about this before; we have the potential to see exports improve greatly in the next couple months, but it hasn’t happened yet. Improved exports would lead to a move up to $8.00.

 

Action: I would still like to own $6.50 July KW puts for 50 cents on 25% of production. We are within 13 cents of that being possible.

 

SOYBEANS:

Trend: Short Term Up – Long Term Up

Sentiment: The upside leader.

 

The March soybeans gained 59 cents this week. Friday’s close was the best since October 2nd and was above the 100-day moving average for the first time since August 4th.

 

The technical outlook for the market looks friendlier all the time. Both the weekly and March daily charts have an upside objective of $11.11 and it is looking more and more likely all the time that we reach it soon. The market is a bit overbought, but the two days of corrective activity that we had this week may be enough for the time being.

 

One thing that is really impressive about the soybean complex is how well the bull spreads worked this week. Bull spreads work in bull markets and we have to pay attention to that.

 

Fundamentally one has to be impressed by the export sales pace. The USDA is still significantly underestimating our potential exports. Private forecasts of S. American production continue to drop and a smaller S. American crop means we will continue to be a major supplier to China both this year and next. An extra 25 – 50 million bushels of exports this year could have a major impact on ending stocks if the crush pace doesn’t continue to deteriorate. Crush is still a concern with poor livestock margins and lower numbers.

 

Action: One should own calls against sales. Preferably in the July contract.

 

CATTLE:

Trend: Short Term Down – Long Term Down

Sentiment: Trend indicators turning back down.

 

After a good start to the week, the cattle market suffered heavy losses on Wednesday and Thursday. Cash trade ended up being $84 in Kansas. The live cattle futures are back below the 50-day moving average so we have to be sellers again. Feeder cattle are hovering around the 50-day moving so we have to be cautious. I really want to be long these markets, but the technical indicators are still mostly negative.

 

Action: Sell February and April LC until we see a close above the 50-day moving average.

Title: Re: Corn:
Post by: mikey on January 18, 2009, 05:11:13 AM
World Agricultural Supply and Demand Estimates - January 2009
US wheat and corn stocks are expected to be up, while global production is down this month compared to last according to the January World Agricultural Supply and Demand Estimates from the World Agricultural Outlook Board. World trade in wheat is up and production of oil seeds has also risen the report says.


WHEAT: Projected US wheat ending stocks for 2008/09 are raised 32 million bushels this month with lower projected domestic use. Feed and residual use is projected 30 million bushels lower as 1 December stocks, reported in the January Grain Stocks, indicate lower-than-expected feed and residual use during September-November. Seed use is reduced 2 million bushels based on lower than- expected winter wheat planted area as reported in Winter Wheat Seedings. The projected season-average farm price is narrowed 10 cents on both ends of the range to $6.50 to $6.90 per bushel.

Small supply and use changes for wheat in 2007/08 and earlier years are made based on revisions in the Field Crops Final Estimates 2002-2007, released December 31, 2008. A 16-million-bushel reduction in 2007/08 production and an offsetting reduction in feed and residual use are the most significant changes.

Global 2008/09 wheat production is projected at 682.9 million tons, down 1.1 million from last month. Lower production in Argentina and EU-27 more than offset an increase for Turkey. Production is lowered 1.0 million tons for Argentina as extended drought reduced yields. Production is lowered 0.4 million tons for EU-27 reflecting a downward revision in official government statistics by France. Production is raised 0.3 million tons for Turkey as drought impacts were less than expected in some areas and higher quality seed boosted yields in others.

World wheat imports and exports for 2008/09 are both raised this month. Imports are increased 1.0 million tons for the EU-27 as member countries import low-priced, low-quality wheat from Ukraine. Imports are raised for Saudi Arabia based on recently announced tenders and for Turkey based on the pace of shipments to date. Imports are lowered 0.5 million tons for South Korea as increased use of alternative feeds, including distillers grains and cassava, reduce demand for feed quality wheat. Exports are raised 1.0 million tons for Russia as burdensome supplies of wheat make Russia the low-cost competitor in many markets. Exports are also raised for Mexico and Turkey. Partly offsetting is a 1.0-million-ton reduction for Argentina as lower production and restrictive government policies limit exports.

World wheat consumption for 2008/09 is lowered this month. World wheat feeding is lowered 1.3 million tons on reduced feeding for the United States and South Korea. Global ending stocks are increased 1.0 million tons mostly reflecting the increase in U.S. ending stocks. Increases in projected ending stocks for EU-27, Saudi Arabia, and Turkey are mostly offset by reductions for Russia and Mexico.

COARSE GRAINS: U.S. corn ending stocks for 2008/09 are projected 316 million bushels higher this month on higher estimated production and lower expected use. Corn production for 2008/09 is estimated 81 million bushels higher. Feed and residual use is reduced 50 million bushels reflecting lower animal numbers and September-November disappearance as indicated by December 1 stocks. Ethanol corn use is lowered 100 million bushels as sustained negative ethanol production margins since early December have reduced incentives for ethanol output. Recent increases in trading values for Renewable Identification Numbers (RINs) that can be used in lieu of ethanol to meet mandated levels also indicate reduced demand for ethanol. Projected food, seed, and industrial use is lowered an additional 35 million bushels on lower-than-expected use for sweeteners and starch during September-November. Exports are projected 50 million bushels lower based on the slow pace of sales and shipments to date. The projected season-average farm price for corn is lowered 10 cents on each end of the range to $3.55 to $4.25 per bushel.

Sorghum ending stocks for 2008/09 are increased 27 million bushels on higher estimated production and lower expected feed and residual use. Projected sorghum feed and residual use is reduced 20 million bushels on lower-than-expected September-November disappearance as indicated by December 1 stocks. The sorghum season-average farm price range is lowered 10 cents on both ends of the range to $2.90 to $3.50 per bushel. The barley farm price is narrowed 10 cents on each end of the range to $4.95 to $5.35 per bushel. The oats price is raised 10 cents on each end of the range to $2.90 to $3.10 per bushel based on producer prices to date.

Small supply and use changes for feed grains in 2007/08 and earlier years are made based on revisions in Field Crops Final Estimates 2002-2007. A 36-million-bushel reduction in 2007/08 corn production and an offsetting reduction in feed and residual use are the most significant changes.

Global coarse grain supplies for 2008/09 are projected 5.5 million tons higher with global corn production raised 5.1 million tons. Increased corn production in China, the United States, Mexico, Russia, and EU-27 more than offset reductions for Brazil and Argentina. Corn production for China is raised 5.5 million tons on higher area and yields as indicated by available national and provincial government data. Mexico production is raised 1.0 million tons as favorable weather is reflected in the latest indications of yields. Production for Russia is raised 0.3 million tons on higher harvested area and higher yields consistent with late-season harvest results. EU-27 production is raised 0.3 million tons reflecting official government statistics by France. Brazil corn production is lowered 2 million tons as extended dryness and heat during December sharply reduced yield prospects for southern Brazil. Argentina production is lowered 1.5 million tons as continued drought and extended heat during December reduced prospects for harvested area and yields in eastern Argentina.

World coarse grain imports and exports for 2008/09 are both lowered this month mostly on lower expected corn trade. Corn imports are lowered 1.0 million tons for Mexico with part of this reduction offset by a 0.3-million-ton increase in sorghum imports. Smaller reductions in imports are projected for a number of other countries where feeding is projected lower. Corn exports are lowered 1.5 million tons for Argentina and 0.8 million tons for India. Global corn consumption is lowered with lower expected feeding and food, seed, and industrial use, much of this reduction coming from changes to the U.S. balance sheet. Global corn ending stocks for 2008/09 are projected 12.2 million tons higher with the United States and China accounting for most of the increase.

RICE: The U.S. 2008/09 rice crop is estimated at 203.7 million cwt, up slightly from the previous estimate as an increase in area more than offsets a reduction in yield. Average yield is estimated at 6,846 pounds per acre, down 113 pounds per acre from last month, and 373 pounds per acre below record 2007/08. Harvested area is estimated at 2.98 million acres, up 52,000 acres from the previous estimate. Combined medium- and short-grain production is increased 1.7 million cwt to 50.5 million and more than offsets a reduction of 1.5 million cwt for long-grain rice to 153.3 million.

U.S. rice imports for 2008/09 are projected at 18.0 million cwt, down 4.5 million from last month with imports of combined medium- and short-grain rice reduced 2.5 million and long-grain imports down 2.0 million. The reduction in the import projection is due to a slower-than-expected pace of imports early in the marketing year from key suppliers including China, India, and Thailand, and the expectation that the pace will stay depressed the remainder of the marketing year. Domestic and residual use is raised 1 million cwt to 127 million based in part on food, industrial, and residual use implied by December 1 rice stocks. All rice exports are lowered 5 million cwt to 101 million, with long-grain down 6 million and combined medium- and short-grain up 1 million. Rough rice exports are lowered 1 million cwt to 38 million, while combined milled and brown exports (on a roughequivalent basis) are lowered 4 million cwt to 63.0 million. All rice ending stocks are projected at 23.2 million cwt, slightly below last month, with the reduction all in long-grain.

The all rice season-average farm price for 2008/09 is forecast at $16.50 to $17.50 per cwt, up $1.35 per cwt on both ends of the range. The long-grain season-average farm price range is projected at $15.50 to $16.50 per cwt, up $1.00 per cwt on each end of the range. The combined medium- and short-grain farm price range is projected at $21.50 to $22.50 per cwt, up $3.50 per cwt on each end. Although global rice prices have trended downward since the beginning of the marketing year, they are declining at a slower rate than expected and recently Thailand’s nominal export quotes have risen. Government policies in Thailand (intervention program) combined with continued export bans by India and Egypt have supported global prices. Additionally, monthly farm prices reported by the National Agricultural Statistics Service (NASS) through December (preliminary) indicate that the season-average price will be higher than projected a month ago, particularly for combined medium- and short-grain rice.

Global 2008/09 rice production, consumption, and ending stocks are raised slightly from a month ago, while trade is little changed. The increase in global rice production is due primarily to a larger 2008/09 rice crop in China, which is up 4.2 million tons to 135.1 million, and the largest crop since 1999/00. The increase in China’s crop is due to an increase in both area harvested and yield and is based in part on national and provincial government information. Global ending stocks are projected at 82.7 million tons, up 1.8 million from last month, up 4.0 million from 2007/08, and the largest stocks since 2002/03.

OILSEEDS: U.S. oilseed production for 2008/09 is estimated at 89.1 million tons, up 0.9 million tons from last month. Increases for soybeans and peanuts are only partly offset by decreases for cottonseed, canola, and sunflowerseed. Soybean production is estimated at 2.959 billion bushels, up 39 million bushels from last month based on both higher yields and harvested area. The soybean yield is estimated at 39.6 bushels per acre. Soybean exports are raised 50 million bushels to 1.1 billion due to strong sales and shipments to China. Projected soybean crush is reduced 30 million bushels to 1.685 billion bushels reflecting sharply reduced domestic soybean meal consumption. Soybean ending stocks are projected at 225 million bushels, up 20 million. Lower soybean oil production is more than offset by reduced domestic consumption and exports, leaving projected soybean oil stocks at 2.1 billion pounds, up 110 million from last month.

The U.S. season-average soybean price range for 2008/09 is projected at $8.50 to $9.50 per bushel compared with $8.25 to $9.75 per bushel last month. Soybean oil prices are forecast at 32 to 35 cents per pound, up 1 cent on the bottom of the range. Soybean meal prices are projected at $250 to $310 per short ton, up $10 on both ends of the range.

Global oilseed production for 2008/09 is projected at 416.3 million tons, down 2 million from last month. Foreign production is projected at 327.2 million tons, down 2.9 million. Global soybean production accounts for most of the change, projected at 233.2 million tons, down 1.5 million. Argentina’s soybean crop is projected at 49.5 million tons, down 1 million. The reduction is mainly due to lower projected area reflecting the impact of dry weather on soybean planting. Soybean production for Paraguay is reduced 0.9 million tons to 5.6 million tons as unusually dry, hot weather has reduced yield potential throughout much of the country. Dry conditions also have resulted in reduced soybean production for Bolivia and Uruguay, and reduced sunflowerseed production for Argentina. Other changes include lower cottonseed production estimates for India and increased sunflowerseed production for EU-27 and Russia. The Russia crop is projected record high at 7.4 million tons, up 0.4 million from last month.

SUGAR: Projected 2008/09 U.S. sugar supply is increased 111,000 short tons, raw value, from last month, due to higher production more than offsetting revised lower beginning stocks. Cane sugar production is raised 119,000 tons based on increased production of sugarcane. Beet sugar production is unchanged and consistent with processors’ projections. Sugar use is unchanged.


Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 19, 2009, 01:23:51 PM
Bill to Use Lands for Biofuel Crops Pushed
THE PHILIPPINES - Agriculture Secretary Arthur C. Yap appealed to Congress for the immediate passage of the Land Use Act that would identify areas that will be planted with biofuel crops.



"This is something that they must prioritize. If this law is implemented, that will help us identify millions of hectares of underutilized or idle lands that will be planted with jatropha, cassava and sugarcane," he said.

Earlier this year, the House of Representatives together with the Department of Interior and Local Government and the University of the Philippines, agreed to join forces to work for the ultimate enactment of a Land Use Code. The code will serve as a guide for the judicious and appropriate utilization of the country’s land resources.

The law will recognize lands for protection, production, settlements development, and infrastructure development, reports BusinessWorld.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 19, 2009, 01:26:17 PM
Renewable Energy Act Becomes Law
PHILIPPINES - The Philippine president Gloria Macapagal-Arroyo this week signed into law the Renewable Energy Act, which is designed to make the Philippines 60 per cent energy self sufficient by 2010.



The new act has been welcomed by the Philippine Independent Power Producers Association (Pippa).

In a statement the association said it would be a big boost to the country in its efforts for self sufficiency.

The act is expected to attract more investment in new renewable energy projects such as solar, wind and geothermal as well as other biofuel projects.

As the act was being signed a Korean company was reported to be showing interest in a large biofuels project in Bais City in Negros Oriental.

The mayor of the city, Hector Villanueva, is reported to be giving the plans a cautious welcome.

The plans include plantations of 5,000 to 10,000 hectares of jatropha and the mayor is uncertain about the ability of the city to provide such large areas of land.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 19, 2009, 01:29:14 PM
British Unit to Build Biomass Plants
PHILIPPINES - A subsidiary of Global Green Power Plc is to build two 18-megawatt biomass power plants in Panay worth $40 million each.



The company has signed energy supply deals with local electric cooperatives that are expected to provide P9.3 billion in economic benefits to residents over 25 years.

According to Business World the biomass plants, which will use agricultural waste, wood and plant crops, will replace coal-fired power plants.

Business World said that each project is expected to deliver P200 million to the local community where the plants are located during the first year of operations and an accumulated P9.3 billion from each biomass plant over the 25-year contract period.

"The P9.3 billion is the estimated economic benefit of each project, which delivers significant social benefits to the local community," Global Green founder and Chief Executive Officer David de Montaigne told Business World.

The plants, he added, would mitigate climate change through the use of agricultural waste and promote sustainable forestry.

Affiliate Green Power Panay Philippines Inc. (GPPPI) signed electricity supply deals with the Iloilo Electric Cooperative (ILECO) I and II on last week

. The first plant will be in the ILECO II area and is expected to be completed by January 2011, followed by the second plant several months later.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 20, 2009, 10:08:07 AM
Govt to import rice, corn to fill shortfall
Manila Standard
18 January 2009 | 11:30 PM
 
THE Philippines, the world’s biggest rice importer, has agreed to import supplies to cover this year’s projected shortfall in domestic output, allaying local concerns stockpiles may not be adequate.

“All rice commitments for 2009 have already been taken care of” and imports may total about 1.5 million metric tons, Agriculture Secretary Arthur Yap told reporters yesterday after figures showed local output gains last year had missed targets. Yap didn’t say which countries would supply the grain.

At the same time, Yap said the country would import at least 300,000 metric tons of corn feed and 120,000 metric tons of wheat feed next month to ensure that prices of hog and poultry products remained stable.

“Several of our farmers have shifted to planting palay instead because the price of palay is good,” Yap said. “So now we have a supply mismatch and a gap of two to four weeks of corn production.

Yap said the National Food Authority would import 200,000 metric tons of the corn feed, while livestock farmers would import about half that volume.

Rice futures surged to a record last year, in part as the Philippines attempted to arrange overseas shipments to cover its shortfall. The country wants to become self-sufficient in the production of rice, the most important local foodstuff, and aims to expand acreage and irrigation to meet that goal by 2013.

Philippine rice output expanded 3.5 percent to 16.8 million tons in 2008, according to a statement yesterday from the Agriculture Department. That compares with the 4-percent gain to 16.9 million tons forecast by the government in November.

The country, which imported 2.3 million tons of rice last year, has been in talks with Thailand and Vietnam for 2009 shipments, Yap said on Dec. 19. The Philippines began government-level negotiations to buy the staple after the World Bank said its system of public tenders, which handled offers from companies, may have helped lift prices last year.

The auction system used by the country had sent signals last year that the nation really needed rice, World Bank Philippine Country Director Bert Hofman said then. That perception “probably distorts the market,” he said.

Rough rice for March delivery gained 0.8 percent to $13.62 per 100 pounds on the Chicago Board of Trade at 9:23 a.m. Singapore time. The contract touched a record $25.07 per 100 pounds last April amid concerns about a possible global shortage and as the Philippines prepared to buy imports.

Rice futures may jump again this year after farmers cut fertilizer use to curb costs and the global credit crunch reduced the volume of agricultural loans, Samarendu Mohanty, head of the social sciences division at the Laguna-based International Rice Research Institute said on Jan. 9. Joyce Pangco Pañares with Bloomberg Back to top
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 25, 2009, 03:02:24 AM
Chinese Urbanisation to Swallow up Global Grains
CHINA - Global grain markets are facing breaking point according to new research by the University of Leeds into the agricultural stability of China.



Experts predict that if China’s recent urbanisation trends continue, and the country imports just 5 per cent more of its grain, the entire world’s grain export would be swallowed whole.

The knock-on effect on the food supply - and on prices - to developing nations could be huge. This is the conclusion of the Quantifying and Understanding the Earth System (QUEST) project which has been funded by the Natural Environment Research Council (NERC). QUEST aims to look at global scale impacts of climate change across a range of areas including fisheries, agriculture, and epidemiology.

Sustainability researchers have conducted a major study into the vulnerability of Chinese cropland to drought over the past 40 years, which has highlighted the growing fragility of global grain supply, says the report. Increased urban development in previously rich farming areas is a likely cause.

“China is a country undergoing a massive transformation, which is having a profound effect on land use,” says Dr Elisabeth Simelton, research fellow at the Sustainability Research Institute at the University of Leeds, and lead author of the study. “Growing grain is a fundamentally low profit exercise, and is increasingly being carried out on low quality land with high vulnerability to drought.”

The study looked at China’s three main grain crops; rice, wheat and corn, to assess how socio-economic factors affect their vulnerability to drought. Researchers compared farming areas with a resilient crop yield with areas that have suffered large crop losses with only minor droughts.

They found that traditionally wealthy coastal areas are just as susceptible to drought as areas with poor topography in the east of the country.

“Quality land is increasingly being used for high profit crops, such as vegetables and flowers. The impact of this on local and global economies is an issue that the newly created Centre for Climate Change, Economics and Policy (CCCEP) will address,” explains Dr Simelton.

CCCEP is a partnership between the University of Leeds and the London School of Economics. Its main objectives include developing better climate change models and understanding how developing countries can adapt to climate change.

At the moment the Chinese government claims that China is 95 per cent self sufficient in terms of grain supply. If China were to start importing just 5 per cent of its grain (to make up a shortfall produced by low yields or change of land use to more profitable crops) the demand would hoover up the entire world’s grain export.

The pressure on grain availability for international grain markets could, in turn, have a huge knock-on effect. Poorer countries are particularly vulnerable, as demonstrated by the 2007-2008 food crisis.

Published in the journal Environmental Science and Policy, the study used provincial statistics of harvests and rainfall together with qualitative case studies to establish the differences between land that is sensitive to drought and land that is not.

“One aim of this research is better understanding of the socio-economic responses to difficult conditions so that we can improve models of climate change” says Dr Simelton.

“These trends of urbanisation are also happening in India, with the population predicted to keep on rising until at least 2050. Ultimately the limiting factor for grain production is land, and the quality of that land.”

The research is part of the Quantifying and Understanding the Earth System (QUEST) project and has been funded by the Natural Environment Research Council (NERC). QUEST aims to look at global scale impacts of climate change across a range of areas including fisheries, agriculture, and epidemiology.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 28, 2009, 03:52:02 AM
Tuesday, January 27, 2009Print This Page
Weekly Outlook: Corn and Soybean Export Progress
US - During the first five months of the 2008-09 marketing year, soybean exports and export sales have been surprisingly large, writes Darrel Good, Extension Economist, University of Illinois.



In contrast, exports and export sales of corn have been disappointingly small. At the beginning of the marketing year (September 2008) the USDA projected marketing year soybean exports at one billion bushels. That forecast is now at 1.1 billion bushels, only 61 million (5.3 per cent) less than the record exports of a year ago. In September 2008, the USDA projected corn exports at two billion bushels. That forecast is now at 1.75 billion bushels, 686 million (28 per cent) less than the record shipments of a year ago.

As of 22 January, 2009, 20.5 weeks into the 2008-09 marketing year, the USDA reported cumulative US soybean export inspections at 627 million bushels, 65 million larger than the cumulative total of a year earlier. Through November 2008, cumulative Census Bureau estimates of soybean exports were 16 million bushels larger than the USDA export inspection estimates, about the same margin as last year. The larger shipments to date reflect the rapid pace of imports by China. As of 15 January, 2009, exports to China totaled 352 million bushels, 39 per cent more than exports of a year earlier. Nearly 60 per cent of US exports through 15 January were to China, compared to 47 per cent last year. To reach the USDA projection of 1.1 billion bushels for the year, shipments to all destinations during the final 31.5 weeks of the year need to average only 14.5 million bushels per week. Last year, export shipments averaged 17.7 million bushels per week during the final 31.5 weeks of the year.

It now appears likely that US exports will exceed the current projection of 1.1 billion bushels, resulting in smaller year ending stocks if the projected level of domestic crush is reached. That projection of 1.685 billion bushels is 6.4 per cent less than the crush of last year. The crush during the first quarter of the marketing year was 10 percent below that of a year earlier. Crush during the last three quarters of the year needs to be only 5.2 per cent smaller than the crush of a year earlier in order to reach the projected level.

As of 20 January, 2009, the USDA reported cumulative marketing year corn exports of 617 million bushels, 412 million bushels less than the total of a year earlier. Through November 2008, the cumulative Census Bureau export estimate was about 40 million bushels larger than he USDA export inspections estimate, about the same difference as a year earlier. The decline in shipments so far this year (through 15 January) reflects sharp declines in exports to Egypt (70 per cent), South Korea (43 per cent), Taiwan (36 per cent), and Mexico (21 per cent). Shipments to Japan, the largest US customer, were about 2 per cent larger than shipments of a year ago. Shipments to Japan accounted for 39 per cent of the US total, compared to 23 per cent at the same time last year. The major factor contributing to the decline in US corn exports is the large increase in corn production outside of the US. The USDA currently projects that production at 19.04 billion bushels, about 900 million bushels larger than production of a year ago. Another factor contributing to the decline in U.S. corn exports may be the sharp increase in feeding of wheat. The USDA projects that feed use of wheat in the rest of the world during the current marketing year will be 835 million bushels larger than feed use of last year.

As of 15 January, 2009, about 304 million bushels of US corn had been sold for export, but not yet shipped. A year ago, outstanding sales stood at 773 million bushels. To reach the USDA export projection of 1.75 billion bushels, an additional 790 million bushels of US corn must be sold for export, an average of 25 million bushels per week. Shipments need to average about 35 million bushels per week. Shipments have reached or exceeded that level in only three weeks so far this year, and all of those were last fall.

It now appears that 2008-09 marketing year corn exports could fall short of the USDA projection of 1.75 billion bushels, adding to year ending stocks and reducing the need for corn acres in 2009. However, the fate of the Argentine crop may have an impact of US corn exports. Earlier this month, the USDA reduced the projected size of Argentine production and exports by nearly 60 million bushels. Further reductions are likely and could result in a small increase in the demand for US corn.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 29, 2009, 03:42:07 AM
 The global food crisis
Chocolate prices set for further increases
By Javier Blas and Jenny Wiggins in London

Published: January 25 2009 19:45 | Last updated: January 25 2009 19:45

Chocolate prices in the shops are likely to rise further, hitting cash-strapped consumers, after wholesale cocoa prices in London jumped last week above the key £2,000 a tonne level for the first time in almost 24 years.

Premium chocolate brands, which typically use more cocoa, are likely to be the worst affected as any further rise in prices is expected to exacerbate the shift by consumers to cheaper brands to save money. Confectionery companies such as Mars, Nestlé and Cadbury were tight-lipped about their pricing plans after the jump in wholesale cocoa prices. But Cadbury, which lifted its chocolate prices 5 per cent last year, has warned that if cocoa prices remain high, it will raise prices further again this year.

EDITOR’S CHOICE
Cocoa prices at 24-year high above £2,000 - Jan-23Cocoa in commodities spotlight - Jan-20Supply concerns push cocoa close to 23-year high - Jan-08Ivory Coast cocoa industry stares at bleak future - Jan-14FT.com: markets page - Apr-14As the key cocoa contract is priced in sterling, the impact on chocolate prices in stores will, however, be eased for consumers outside the UK because of the strength of the euro and the US dollar against the British pound.

Hedging by the chocolate industry should also help protect producers to some extent against notoriously volatile cocoa prices.

Cocoa prices last week rose 15 per cent to £2,005 a tonne, the highest level since April 1985, in part because of the weakness of sterling, but also because of fresh worries about the crop in West Africa and speculative buying. Prices have risen 75 per cent in the past year.

There are growing concerns that supplies from the Ivory Coast and Ghana, the world’s two leading producing countries which together account for almost 60 per cent of the global cocoa bean output, will be much lower than last year.

Cocoa bean arrivals at ports in Ivory Coast are running about 30 per cent below last harvesting season. The concerns about a lower crop have spread to neighbouring Ghana after Hans Kilian, the influential cocoa analyst, lowered its harvest estimates for the West African country, traders said.

“If the price of cocoa is going up due to scarcity, this is because individual farmers are producing lower yields,” said Sophi Tranchell, managing director at Divine Chocolate. “Chocolate prices are going up in store, but the high cocoa price won’t necessarily benefit those individuals,” she added. Divine is a chocolate brand part-owned by cocoa producers in Africa.

Cocoa buyers at one large chocolate manufacturer said they believed that speculative activity in the cocoa market has also increased.

Shares in Swiss chocolate group Lindt, whose sales have boomed in recent years, have dropped 8 per cent over the past month amid concerns over weakening sales.
Copyright The Financial Times Limited 2009

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on January 29, 2009, 03:55:17 AM
Philippines to rely more on corn imports
[29 January 2009] Philippine Agriculture Secretary Arthur Yap has hinted that the Philippines might have to rely on more corn imports this year as local corn production may drop following the decision of some corn farmers to shift to rice and the high costs of fertilizers that prompted farmers to forego their use, resulting in lower yield. The government has agreed to allow the importation of 200,000 tonnes of yellow corn, after livestock and poultry raisers and feedmillers complained about the lack of supply.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 04, 2009, 09:50:27 AM
China stocks up its grain reserves 02 Feb 2009
To prevent price falls in the abrupt econmico slowdown of the country, China will keep stocking grain for its state reserves and encourage companies to build up commercial storage.
The government would also increase the price floor for government grain purchases, according to Chen Xiwen, Director of the Office of the Central Rural Work Leading Group. "Agricultural product prices are decided by market supply and demand rather than the government. What the government could do is to set a minimum purchase price to prevent prices from falling excessively," he added.

Chen also said Beijing would consider increasing grain exports to better balance domestic and global demand and supply. "If there are demands in the international market, China will increase some grain exports at reasonable prices so as to ensure global grain security as well as promote a balance in domestic grain demand and supply," Chen said.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 07, 2009, 04:11:36 AM
China stocks up grain reserves
[6 February 2009] China will boost its grain stocks for its state reserves and is encouraging companies to build up commercial storage to prevent drastic price fluctuations due to the economic slowdown.  According to Chen Xiwen, Director of the Office of the Central Rural Work Leading Group, China will increase grain exports if there is a demand to ensure global grain security as well as promote a balance in domestic grain demand and supply.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 09, 2009, 11:38:29 AM
[9 February 2009] India corn futures was expected to trade higher at the end of last week on renewed demand from local poultry feed makers. Demand from this section of the market started to pick up recently, after a downturn due to the bird flu outbreaks. Meanwhile the global economic slowdown and higher Indian prices was pinching exports. India shipped about 3 million tonnes of the commodity in the 2007/08 marketing year (October to September) mainly to Southeast Asian countries.
--------------------------------------------------------------------------------
 
China’s drought triggers alert
[9 February 2009] The Chinese Office of State Flood Control and Drought Relief Headquarters launched an orange alert last week, urging local authorities to be aware of the severe drought and offer relief. The drought that's been on since last November has affected 9.73 million hectares of crops nationwide, of which 9.26 million hectares cover wheat, or 46% of the country’s total wheat acreage. However, an industry analyst expects wheat production this year to decline by only 3-5% thanks to a bumper harvest last year. 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 10, 2009, 07:49:43 AM
Monday, February 09, 2009Print This Page
Grain Prices to Rise as Production Falls
GERMANY - Experts at the DLG Winter Seminar said they expect price increases in second half of 2009 with wheat in the Paris exchange rising to €200 per tonne. Recommendations include forward selling when prices high.



The worldwide economic crisis could reduce production of grain and oilseeds and see prices pushed upwards by autumn of this year according to financial analyst, Jochen Hitzfeld from UniCredit, Munich. He was speaking at the DLG's Wintertagung conference in Berlin in January. And his predictions were good news for the investment climate at the world's largest farm equipment exhibition, Agritechnica, to be held in Hanover, on 10 to 14 November (with preview days on 8 and 9 November) where specialists from all over the world gather to learn about, and invest in, the latest technology solutions for efficient agriculture.

Behind the expected price boom is the difficulty, especially in emergent countries, of getting credit – a situation already stopping expansion of agricultural production in Russia and the Ukraine, at least for the moment, according to Mr Hitzfeld. On top of this, global reduction in demand for fertiliser and plant protection sprays could have a negative effect on yields this harvest. Following farm product price reductions in the last months, cropping on 30 per cent of the most expensive production areas was no longer profitable, leading to an over 10 per cent reduction in northern hemisphere growing area.

But another expert at the DLG Wintertagung, Frank Gagel of traders Schouten Ceralco in the Netherlands, warned of continued fluctuations in wheat price. Bread wheat at the Paris Exchange (MATIF) would not go lower than €130 per tonne, he felt. Mills and feed plants still needed substantial supplies for production up to the new harvest. So there was plenty of room for price rises up to €200 per tonne.

Dr Rüdiger Fuhrmann from the Norddeutschen Landesbank (NordLB) did not expect farmers to have difficulties in getting credit because of the current economic downturn. Agriculture has a good reputation amongst banks due to its relatively low failure rate and because, from the credit institutes' point of view, farm businesses behaved well during the recent bull market. Even compared with medium-sized businesses, the farming sector is small-structured with credit risks thus spread widely. However, a more rigorous selection procedure for credit is now expected and farmers will have to establish suitable control and risk management instruments if they wish to be credit worthy in future.

Austrian farmer, Maximilian Graf Hardegg, reassured the 700-strong Wintertagung audience that agriculture was still in a good position despite the current turbulent market. The growing world population would continue to need a steady food supply.

But German farmer, Deert Rieve, from Mecklenburg-Vorpommern warned of the liquidity trap. Volatile price fluctuations mean variations in margins, the size of which had never before been experienced, he pointed out. Input costs and product selling price must therefore be more closely controlled than ever before. Those enterprises already struggling under the burden of debt could only expect conditions to worsen, he felt. And he called for more attention to unit costs: business risks were linked with the size of these and so reducing the unit costs reduced the financial risks. In a volatile market, precise knowledge of unit costs was also crucial in determining time of product sale.

Imperative in such markets was the possibility of short-term adjustment of land rents, reckoned Mr Rieve. Additionally, investments needed to be adjusted to match more closely fluctuating liquidity. Finally, new business strategies for deflation and inflation phases needed to be developed. Inflation had the effect of depleting reserves of high performance businesses and so in such cases investment was often better than adding to capital reserves.

Grain Shortage Expected
Commodity expert, Mr Hitzfield expects a significant grain deficit in the coming fiscal year. He predicted world wheat production would fall from 676 million tonnes to 627 million tonnes. Consumption will remain stable since the drop in transport costs would probably cause increased demand from typical deficit regions.

Even a more conservative estimate with demand remaining unchanged at 652 million tonnes could result in world stocks being reduced from 140 to 115 million tonnes in 2009/10 which meant only a 62-day supply for the world population after the end of the season, reckoned Mr Hitzfeld. "Then we are very rapidly back to the price highs where we were 15 months ago," he said.

Adverse weather conditions could also cause a new wave of export embargos and excessive speculation. In this case, a justified price increase of 30 per cent could rapidly become a doubling of price for the most important food grains, leading possibly to new protests at more expensive foods.

Don't be Greedy!
Grain dealer, Frank Gagel, warned the whole sector to forget about wringing the last Euro out of every deal. In the future, buyers'’ and sellers' markets would alternate frequently and this meant a need for a new partnership between trade and agriculture. Supply the market regularly and, where prices are right, make the occasional delivery contract, Mr Gagel advised farmers.

"When costs are covered and the profit margin is acceptable, as a farmer, I must get rid of my product," he said. Taking the example of spring 2008, he said that it was hard to understand from a dealer's point of view why, with total production costs for wheat at around €150 per tonne, many farmers had failed to part from their crop when buyers were offering €250 per tonne or more.


Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 11, 2009, 02:01:14 PM
 Pork, chicken prices could go up on corn shortage
[11 February 2009] The possible corn shortage in the country could mean higher pork and chicken prices, two lawmakers from the Philippines said. Representatives Nicanor Briones of the Agricultural Sector Alliance of the Philippines and Rodolfo Plaza of Agusan del Sur both called on the government to ensure adequate supply of corn. While corn prices have dropped to about PHP 15-18 (USD 0.32-0.38)/kg in the last couple of weeks, Mr Briones warned that this is temporary and that “the price may increase any time if the buffer stock is depleted.” The government in January allowed for the importation of about 200,000 tonnes of corn but this is not expected to arrive until about March or April this year.

 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 18, 2009, 02:50:02 AM
17 February 2009] Although Luzon is currently suffering from a tight supply of yellow corn for feeds, surplus in the Visayas and Mindanao will be enough to tide over end-users until the summer harvest starts in March. A surplus of 360,000 in the Vis-Min Region that will go to Luzon. Livestock and poultry farmers had earlier projected a supply shortfall of about 600,000 tonnes for the year, while the government said it may be around 300,000 tonnes. However, more accurate forecast can only be made after the summer harvest in March and April.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 20, 2009, 03:22:32 AM
[19 February 2009] Pork and poultry prices are likely go down next month in the Philippines as corn harvest peaks and more corn is shipped from abroad. "We expect prices to ease by the middle of March because imports by the private sector are coming and farmers in northern Luzon, will already harvest," Agriculture Assistant Secretary Salvador S. Salacup said. The price increase was brought on by shortage in corn supply in the second week of December to the third week of January. Retail prices of whole chicken went up by PHP 10/kg (USD 0.21) to PHP 130/kg (USD 2.75) while egg price increased to PHP 4.40/piece (USD 0.09) from PHP 4.25/piece (USD 0.08).
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 25, 2009, 11:20:34 PM
[17 February 2009] Although Luzon is currently suffering from a tight supply of yellow corn for feeds, surplus in the Visayas and Mindanao will be enough to tide over end-users until the summer harvest starts in March. A surplus of 360,000 in the Vis-Min Region that will go to Luzon. Livestock and poultry farmers had earlier projected a supply shortfall of about 600,000 tonnes for the year, while the government said it may be around 300,000 tonnes. However, more accurate forecast can only be made after the summer harvest in March and April.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on February 27, 2009, 05:30:13 AM
26 February 2009] Philippine feedmillers and meat producers are likely to delay importing 140,000 tonnes of corn to May when stock of locally grown corn is low. They said the price of local corn in May would increase and the delay would help cool down the market price after the arrival of imported corn. The Philippine government allowed the importation of 200,000 tonnes of corn in January but only only meat processing giant San Miguel Crop imported 62,400 tonnes at lower tax.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 03, 2009, 03:23:20 AM
From today's Manila Times

Monday, March 02, 2009


Lawmaker warns of severe corn shortage

Rep. Taliño-Mendoza pushes for a new Corn Research Institute to ensure
grain supply in the future

CARMEN, Cotabato: Amid the strained supply of corn nationwide, Rep.
Emmylou Taliño-Mendoza of Cotabato is pushing for the creation of a
new Corn Research Institute (CRI) under the Department of Agriculture
(DA) to ensure that the country's future requirements of the grain are
adequately met.

"We should dedicate a whole new institute to draw up a comprehensive
corn research program, build up production, improve the economic
condition of farmers, and expand livelihood opportunities in the
countryside," said Taliño-Mendoza, whose home province is one of the
country's leading producers of maize.

"Growing demand for corn as food, feed and for industrial use is
inevitable. With land becoming a limiting factor, we must now quickly
raise farm productivity levels. Otherwise, we definitely risk more
severe corn shortages in the years ahead," Taliño-Mendoza warned.

"We already have several public and private research institutes for
rice. We need at least one comparable, high-technology research
institute for corn," she added.

Local corn prices soared from P13.50 to as high as P25 per kilo
earlier this year on account of tight supply. The scarcity prompted
the DA to allow up to 200,000 metric tons of corn imports for delivery
this month, and for use by poultry and hog growers and feed millers.

Next to rice, corn is the country's second most important crop. It is
the staple food of about 20 percent of the population, and the main
component of livestock and poultry feed. Over 2.5 million hectares of
the country's arable land is planted to corn, which supports more than
600,000 farm households nationwide. More than 40 percent of the
country's annual corn output comes from Mindanao.

Due to the rising cost of inputs and the lifting of the tariff on feed
wheat imports that compete with domestic corn, local farmers grouped
under the Philippine Maize Federation Inc. expect this year's
production of the grain to be significantly lower than the DA's
7.8-million metric tons target.

Taliño-Mendoza attributed inadequate corn output on farm inefficiency.
She pointed out that while experimental stations are able to yield up
to eight tons per hectare, farmers in the field are able to produce
only three to 4.5 tons.

Last year, the country produced 6.95 million metric tons of corn. This
was 1.01-million metric tons short of the DA's original 7.96-million
metric tons target, and only slightly higher than the 6.7 million
metric tons output in 2007.

Taliño-Mendoza warned that corn farms are being degraded by rapid soil
erosion. "Left unchecked, this will further contribute to declining
productivity levels," she said.

She also said fierce global competition has increased pressure on
farmers to promptly raise productivity, reduce cost per unit, and
improve yield quality.

Under Taliño-Mendoza's proposal, the CRI would serve as hub of all
corn research and development (R&D) initiatives by the public and
private sectors.

The institute would carry out its own research and development
activities, specifically in improving varieties, planting and
fertilizer management, integrated pest control, farm mechanization,
post-harvest engineering, farming systems, training and technology
transfer, and social science and policy research.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 05, 2009, 01:28:29 AM
[4 March 2009] San Miguel Corporation (SMV) has reiterated its interest in acquiring a stake in the Mariveles Grains Terminal in Bataan province, despite pending court cases involving it, a report from the Philippine Daily Inquirer said. Earlier, SMC and Japan's Toyota Tsusho Corp had agreed to jointly acquire a stake in the terminal for PHP 1.6 billion (USD 33.28 million). The terminal is currently being operated by Asian Terminals Inc (ATI) from which SMC subleases two hectares of the facility. The grains terminal is a gateway for flour, soy bean, corn and other grains and SMC operates a feed plant in the area that can produce 500,000 tonnes annually.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 19, 2009, 01:07:14 AM
CORN futures on the Chicago Board of Trade (CBOT) closed up on Monday. MAY’09 corn futures closed at $3.915/bu; up 3.0 ¢ /bu. The JULY’09 contract closed at $4.0175/bu; up 3.5 ¢ /bu. DEC’09 corn futures finished at $4.215/bu; up 3.25 ¢ /bu. Acreage battles, spillover from other markets, and a weaker U.S. dollar that helped exports were supportive. USDA placed corn-inspected-for-export at 29 mi bu vs. estimates for between 37-41 mi bu. Cash corn bids in the US Midwest were steady from merchandisers and stronger from processors. Funds decreased net bear positions buying over 8,000 contracts. It might be a good idea to get the ’08 crop out of the way, clean the bin out for the ’09 crop, and price up to 45 per cent of the 2009 crop if you haven’t done so already.

SOYBEAN futures on the Chicago Board of Trade (CBOT) were up on Monday. MAY’09 soybean futures closed at $9.110/bu; up 34.5 ¢ /bu. The JULY’09 contract was up 32.25 ¢ /bu at $9.075/bu. The NOV’09 contract closed at $8.504/bu; up 26.75 ¢ /bu. Technical moves such as soy/corn spreading were supportive indicating a positioning of the market ahead of a looming “crop-acres” battle. Exports were better than expected with USDA placing soybeans-inspected-for-export at 27.2 mi bu vs. expectations for between 23-26 mi bu. Cash soybeans were mostly steady as funds decreased net bear positions buying as much as 5,000 lots. It is a good idea to sell all old crop soybeans and get up to 25 per cent of the ’09 crop priced now.

WHEAT futures in Chicago (CBOT) closed up on Monday. The MAY’09 contract closed at $5.442/bu; up 26.0 ¢ /bu. JULY’09 wheat futures finished up 26.0 ¢ /bu at $5.556/bu. Strong technical signs, short covering, stiff outside markets, dry weather in the US Plains, and a weaker U.S. dollar were supportive. USDA placed wheat-inspected-for-export at 12.6 mi bu vs. expectations for between 13-17 mi bu. Funds bought up to 4,000 contracts signaling an end to past levels of short positions. It is a very good idea to get up to 25 per cent of the 2009 crop sold at this time.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 25, 2009, 09:56:34 AM
Tuesday, March 24, 2009Print This Page
Weekly Outlook: What’s Next For Soybean Prices?
US - The USDA’s updated projections of consumption of US corn during the current marketing year serve as a reminder of the central role that market size will play over the next several months, writes Darrel Good, Extension Economist at the University of Illinois.



Soybean futures contracts for the 2008 crop sunk to contract lows in early December 2008 and the average spot cash price in central Illinois dropped under $8.00 per bushel. Prices rallied sharply into early January 2009, with the central Illinois cash price moving above $10.00. Prices collapsed again in early March with the cash price dropping to about $8.35, but rebounded sharply last week with the central Illinois spot cash bid ending the week at $9.38.

Much of last week’s rally in prices was associated with higher energy prices, a rally in financial markets, and a weaker U.S. dollar. These markets, in turn, were influenced by U.S. monetary policy that ignited expectations of an upcoming period of rapid inflation in the U.S. economy. Developments within the soybean complex also continue to be somewhat supportive for soybean prices.

On March 11, the USDA confirmed prospects for a relatively small South American soybean harvest. That crop is now forecast at 3.894 billion bushels, 30 million smaller than the February forecast, and 364 million less than harvested in 2008. The smaller crop bodes well for the export demand for U.S. soybeans for the next 12 months. In addition, potential disruptions to Argentine exports due to ongoing disputes over export taxes may send more near term export business to the U.S. The USDA is already forecasting record soybean exports for the current marketing year. Census Bureau export estimates from September 2008 through January 2009 exceeded cumulative USDA estimates by 32 million bushels. If that margin continued through mid-March, weekly shipments from March 20 through August 31 will need to average only about 11 million bushels per week to reach the USDA projection. New sales of about 4.5 million bushels per week will be needed to reach sales at the projected level of exports of 1.185 billion bushels. The magnitude of sales to China, which has accounted for 58 percent of U.S. export business so far this year, will be watched closely for indications of the strength of old crop export demand.

The weak link in U.S. soybean demand so far in the 2008-09 marketing year is the slow pace of the domestic crush. Crush during the first 5 months of the year totaled 707 million bushels, 84 million less than during the first 5 months of the previous marketing year. The small crush reflected reduced consumption, export and domestic, of both soybean oil and soybean meal. Meal exports, however, were large in January 2009 and data from the Oilseed Processors Association indicated that the February crush was larger than generally expected. Census Bureau estimates for February are not yet available.

A major factor for soybean price prospects is the expected size of the 2009 U.S. crop. Some insight will be provided by the USDA’s March 31 Prospective Plantings report. However, substantial acreage uncertainty will persist beyond that report. The market likely underestimates the ability of producers to adjust planting decisions after March 31. In addition, the question of total crop land acreage planted in 2009 will remain after March 31. Some focus is on the upper Plains right now where melting snow and rainfall will create flooding issues. The market is always quick to think that acreage could go unplanted. That may or may not happen this year. In addition, a continuation of higher crop prices may result in a smaller reduction in total planted acreage than has been forecast. Longer term, yield prospects for the 2009 U.S. soybean crop will become important. A return to a trend yield near 42.5 bushels per acre, for example, would add about 215 million bushels to production in 2009 with no increase in acreage.

The rebound in soybean futures prices and the continuation of a strong basis is giving producers an opportunity to price a portion of the unsold 2008 crop. Decisions for the 2009 crop are more difficult. November futures are slightly above the spring price guarantee for crop revenue insurance so there is some downside risk for unpriced new crop soybeans. That risk is small for the insured portion of the crop, but greater for the uninsured portion. The real dilemma surrounding pricing of the 2009 crop, however, is associated with determining value in a rapidly changing economic environment. Is economic recovery and demand strength eminent? Is the economy headed for a period of rapid inflation and how would that influence soybean prices? Such uncertainty favors a marketing strategy of frequent, small sales. There is more than a year left to sell the 2009 crop.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 02, 2009, 07:49:15 AM
Wednesday, April 01, 2009Print This Page
Weekly Outlook: Friendly Reports
US - The USDA’s Prospective Plantings report indicates that US producers intend to plant less acreage in 2009 than in 2008. Planting intentions for all crops included in the March survey are 7.8 million acres less than acreage seeded to those crops in 2008. Including acreage of hay intended for harvest, the decline is about 7.6 million, writes Darrel Good, Extension Economist at the University of Illinois.



Declines total 4.5 million for wheat, 1.3 million for sorghum, nearly 1 million for corn, 658,000 for cotton, 446,000 for sunflowers, 410,000 for peanuts, and 154,000 for canola. For wheat, 75 per cent of the acreage reduction is for winter wheat, even though winter wheat seedings are 791,000 acres larger than reported in January. Intended acreage of soybeans is 306,000 more than planted in 2008 and intended acreage of rice is 188,000 more than planted in 2008. Intended acreage of all oilseed crops included in this report is 672,500 less than planted in 2008. Intended acreage of feed grains (corn, sorghum, barley, and oats) is 2.4 million less than planted in 2008.

For corn, the largest changes in acreage are planned in Missouri (up 250,000) and North Dakota (down 250,000). Illinois producers intend to increase corn acreage by 100,000, while producers in Iowa intend to reduce acreage by the same amount. Intended acreage in Indiana is equal to last year’s plantings.

Corn planting intentions of 84.986 million acres point to acreage harvested for grain of 77.786 million. The long term trend yield of 152.8 bushels per acre, then, points to a 2009 harvest of 11.862 billion bushels, 239 million smaller than the 2008 harvest. A crop of that size would likely result in a sharp decline in stocks by the end of the 2009-10 marketing year as both exports and ethanol use of corn are expected to increase during the year ahead.

For soybeans, intended acreage is below actual plantings in 2008 by 150,000 acres in Missouri and South Dakota, 100,000 acres in Illinois, and 50,000 acres in Indiana, Louisiana, and Minnesota. The largest increase, 200,000 acres, is planned in Kansas, with increases of 100,000 planned in Iowa, Mississippi, Nebraska, North Carolina, North Dakota, and Ohio.

Soybean planting intentions of 76.024 million acres points to harvested acreage of about 75 million. The long term trend yield of 41.6 bushels per acre, then, points to a 2009 harvest of 3.12 billion bushels, 160 million larger than the 2008 harvest. A crop of that size would likely lead to a small increase in stocks by the end of the 2009-10 marketing year.

Intended acreage of spring wheat, including durum, is estimated at 15.749 million, 1.117 million less than seeded in 2008. Winter wheat seedings are estimated at 42.889 million, 3.392 million less than seeded the previous year.

Stocks of corn on 1 March 2009 were estimated at 6.958 billion bushels, implying that corn used for all purposes during the second quarter of the 2008-09 marketing year totaled about 3.13 billion bushels. 1 March stocks are 100 million bushels larger than those of a year earlier and use during the second quarter was 293 million less than the record use of a year earlier. Exports during the quarter were off 262 million and domestic use declined by only 31 million. Feed use during the quarter was down while use for ethanol production was larger.

Stocks of soybeans on 1 March 2009 were estimated at 1.302 billion bushels, implying that use during the second quarter of the 2008-09 marketing year totaled 976 million bushels. March 1 stocks are about 132 million smaller than on the same date last year and use during the second quarter was 46 million larger than use of a year earlier. The domestic crush was down nearly 47 million bushels; exports up about 50 million; and seed, feed, and residual use was 42 million larger.

Stocks of wheat on 1 March 2009 were estimated at 1.037 billion bushels, 327 million larger than stocks of a year earlier. The estimate, however, is 25 million bushels less than the average pre-report guess.

Taken together, the USDA reports of planting intentions and 1 March stocks are supportive for corn, soybean, and wheat prices. Acreage intended for all crops in 2009 is less than expected and intended acreage of both soybeans and wheat is less than expected. Intended corn acreage is a bit higher than the average pre-report guess, but the large decline in intended acreage of barley and sorghum probably exceeds expectations. March 1 stocks of all three crops were slightly smaller than the average pre-report guesses.

Prices may show a modest response to these reports, but the market will also begin to anticipate how actual plantings may differ from intentions. In addition, financial, currency, and energy markets will continue to have an influence on crop prices as those markets influence over all demand prospects.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 02, 2009, 12:28:34 PM
Less global wheat production this year 27 Mar 2009
According to the International Grains Council (IGC), the global wheat production should fall to 651 million tonnes in 2009/10, down from a record 688 million in 2008/09.
Wheat carry-over stocks for 2009/10 were, however, seen rising 11 million tonnes to 171 million with consumption expected to fall to 640 million from 643 million in 2008/09 due to a drop in animal feed use.

The IGC, in a monthly report, also forecast the 2009/10 world maize crop at 775 million tonnes, down from 782 million in 2008/09 and a record 787 million in 2007/08.

[source: Reuters]

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 11, 2009, 03:12:12 AM
GMO corn to be shipped out of Negros


By Carla Gomez
Inquirer Visayas
First Posted 23:30:00 04/08/2009

Filed Under: Regional authorities, Genetic engineering, Agriculture, Food


BACOLOD CITY – Bounty Agro Ventures, the consignee of the genetically modified (GM) corn shipment, agreed to ship it out of Negros Occidental, Gov. Isidro Zayco said on Tuesday.

However, National Federation of Hog Farmers president Albert Lim warned that Negros Occidental would face a shortage in corn for processing into animal feeds if the seized corn was shipped out.

The provincial government on Saturday seized the yellow corn shipment, worth P18.978 million, found to be genetically modified and kept at the consignee’s warehouse at the Bacolod Real Estate Development Corp. (Bredco) port in Bacolod City.

Zayco said Dante Samonte, Bounty Agro Ventures feed milling operations chief for Visayas and Mindanao who represented the company in a dialog with provincial officials, agreed to ship the 15,746 bags of corn out to comply with a ban on the entry of GMO plants and animals into Negros Occidental.

“I think they agree that the corn they shipped in has GMO because they were the ones who offered to ship it out,” Zayco said.

Samonte, who maintained that the company did not know that the corn shipment was genetically modified, said they would ship the corn out on Monday, probably to Cebu or Iloilo.

He said Negros has a corn shortage so Bounty Agro Ventures had to get its corn requirement for chicken feed from different sources.

He said the company promised that the shipment of GMO corn would not happen again.

Lim said Bounty Agro Ventures would have difficulty replacing the GMO corn that it would be shipping out.

Lim said he learned from company owners that they would slowly pull out their operations from the province if they could not get sufficient corn for their feeds.

If this occurred, Lim warned that the province would have a shortage of poultry.

“We want the corn to stay but the governor said there is a law and we have to follow the law. How sure can we be that processed feeds coming into the province do not use GMO corn?” Lim said
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 11, 2009, 09:40:25 AM
Philippine poultry raisers to turn to Asean for corn
[10 April 2009] Some Philippine poultry producers are looking at Asean countries as possible corn sources under the Asean Free Trade Area (AFTA). United Broiler Raisers Association Chairman Gregorio San Diego said that under the AFTA, corn imports from member nations are levied a 30% tariff, which is lower than the 35% tariff duty on corn imported under the minimum access volume (MAV) scheme under the World Trade Organisation. Mr San Diego said they are exploring the possibility because importing under the AFTA not only means lower tariff, but they would no longer need to ask the government's permission to bring in the corn. With the AFTA scheduled to go into full steam in 2010, he added that tariffs for corn could fall even further making corn trading between and among Asean nations cheaper.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 15, 2009, 01:00:12 AM
Pest hoppers threaten Philippine corn
[14 April 2009] The Philippine corn industry is facing a pest infestation that could lead to lower corn production, a report by Bloomberg said. Citing Roger Navarro, President of the Philippine Maize Federation Inc (Philmaize), the report said that plant hoppers from Indonesia have spread to corn growing areas in Mindanao, which contributes a fifth of the country's total corn production. Mr Navarro said that while it is too early to see how much damage the pest has wrought, “in some areas crops have died and in others the weight of the corn has dropped.” While lower corn production may help support domestic prices during lean periods, “if the pest spreads when demand for feeds was still strong, that would have caused a spike in corn prices,” added Mr Navarro.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 06, 2009, 09:00:47 AM
6 May 2009] Filipino feed millers plan to issue a tender to buy 45,000 tonnes of soybean meal for June shipments. Traders said the tender will open next week. The price of Indian soybean meal including cost and freight to South East Asia being quoted at USD 500/tonne, while the price of South American soybean meal is expected to be lower at USD 470/tonne.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 17, 2009, 09:38:17 AM
Weekly Outlook: Lots of Uncertainty in Crop Markets
US - The USDA’s June projections confirmed prospects for extremely small year-ending US stocks of soybeans, writes Darrel Good, Extension Economist at the University of Illinois.



Those stocks are projected at 110 million bushels, or 3.6 per cent of projected annual consumption. In addition, the Census Bureau estimate of soybean exports for April that were released last week shows exports continuing above the pace reported by USDA.

For the first 8 months of the marketing year, the Census Bureau reports soybean exports of 1.058 billion bushels, 34 million above the cumulative total of export inspections reported by USDA. Assuming that margin persists, as it did last year and in 3 of the past 4 years, exports need to average 10.2 million bushels per week during the final 11.5 weeks of the year to reach the USDA projection of 1.25 billion bushels. Inspections averaged 10.4 million for the three weeks ended 11 May.

On the domestic side, the National Oilseed Processors Association reported a crush of 142.2 million bushels during May. That level of crush is about 5 million larger than anticipated. The Census Bureau will release official crush statistics for May on 25 June, but it now appears that the crush for the year is on pace to exceed the USDA projection of 1.65 billion bushels. It is unlikely, however, that year ending stocks can be reduced much below the current USDA projection.

Even with the pace of consumption remaining relatively large, soybean prices declined sharply in the past few trading sessions. After reaching a high of first over $12.90, July futures declined to the $12.20 area in on 15 June. Basis levels also weakened in many areas last week. After reaching about $.15 over July futures two weeks ago, the average spot cash price in central Illinois was $.02 under July futures on 12 June. Recent price and basis behavior suggests that sufficient rationing of old crop soybeans has occurred. Such rationing, however, is not yet apparent in publicly available data.

Corn prices came under similar pressure in recent trading sessions. July 2009 and December 2009 futures declined about $.40 from the high reached early last week. Basis levels, however, remained generally firm, with the average cash bid in central Illinois at about $.15 under July futures on 12 June. Prospects continue for adequate year ending stocks of corn, but the USDA reduced the projection of stocks at the end of the 2009-10 marketing year by 55 million bushels. Those stocks are projected at 1.09 billion bushels, or 8.7 per cent of projected use. Compared to the May projection, USDA lowered the anticipated US average yield for the 2009 crop by 2 bushels, to 153.4 bushels. Partially offsetting that decline was a reduction of 100 million bushels in the projection of feed and residual use of corn during the year ahead.

The very recent decline in corn and soybean prices appears to be in sympathy with a stronger US dollar, some moderation in energy prices following the recent rally, and a weaker stock market. In addition, the market seems to be more comfortable with production prospects for the 2009 corn and soybean crops. Some much needed rainfall in the western corn belt has offset ongoing concerns about the late planted crops in the east. In addition, the coming warm up in the western corn belt is generally viewed as positive for crop development.

The potential size of the 2009 corn and soybean crops is far farm clear at this time. The most important part of the growing season is still to come. While the short term outlook for warmer weather is viewed as positive, an extended warm, dry period into July, as hinted to by some, would not be favorable. There is also lingering uncertainty about the magnitude of planted acreage of corn and soybeans. The USDA’s 30 June Acreage report will shed further light on that issue.

All of the ingredients for volatile corn and soybean prices appear to be in place. These include tight stocks; fluctuating financial, currency, and energy markets; and large production uncertainty. Some uncertainty will be reduced over the next two months with the release of the USDA’s 1 June Acreage and Grain Stocks reports on June 30 and the unfolding of growing season weather. Fluctuations in the so called outside markets, however, could continue for an extended period. Further shocks could be provided by developments in bio-energy and climate change policy.

Marketing the 2009 corn and soybean crops will be challenging, but opportunities to sell at more attractive prices will likely be available periodically over the next 12 months.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 28, 2009, 02:35:13 AM
Philippines to scrap zero tariff on feed wheat 22 Jun 2009
A government panel In Philippine capital Manila has recommended restoring a 7% tariff on feed wheat imports to protect local corn farmers, a senior official said.
Related.
The government had cut the import tariff on feed wheat to zero for six months starting January to aid feed millers hit by high local corn prices.
 
"The prevailing sentiment is to develop and protect Philippine agriculture," said Thomas Aquino, trade undersecretary and co-chairman of the technical committee on tariff issues.
 
The local feed industry has imported more than 1.1 million tonnes of feed wheat this year, scheduled for delivery until August, as it recovers from higher raw material costs and animal disease last year.
 
That compares to just 112,000 tonnes in all of 2008 when surging prices turned off buyers.
 
The government scrapped the 7% import duty on feed wheat and 3% tariff on food wheat purchases for six months from January to keep bread prices low and aid millers. The zero tariff expired on June 21.
 
But Aquino said the panel recommended maintaining the zero tariff on food wheat imports until December to ensure prices of bread remain low.
 
The recommendations will be submitted for approval by economic managers and later to President Gloria Macapagal Arroyo when she returns from an overseas trip.
 
A group of feed millers is planning to appeal against the potential removal of the zero tariff on feed wheat imports.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 29, 2009, 12:42:59 PM
29 June 2009] Philippine corn farmers are calling on the government to build the necessary infrastructure such as postharvest facilities to allow them to fully participate in corn trading. Philippine Maize Federation (Philmaize) President Roger Navarro said that while the government’s plan to trade in corn is laudable, farmers will have a hard time ensuring the quality of corn without the postharvest facilities such as silos and dryers. He said he hopes that the government will consider buying more corn from farmers during the main harvest season starting in August, and estimated the yield to be around three million tonnes. Mr Navarro also lauded the recommendation to scrap the duty-free importation of feed wheat, saying this will motivate local corn farmers to plant more and expand their crop area.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 06, 2009, 12:13:27 PM
Philippines halts grain imports 
[6 July 2009] The Philippines has imported sufficient grains for use in livestock production for the whole year consisting of 1.1 tonnes of feed wheat and 565,000 tonnes of corn, according to the National Corn Board, a grouping of feedmillers, meat producers, corn planters and traders. It said the next order would be made for January, but feed wheat imports would decline next year due to increasing domestic corn production due to the government’s decision to hike support price and lower fertilizer price. Accroding to the board, shortfall of feed grains in the Philippines would be less than one million tonnes this year.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 15, 2009, 08:21:02 AM
Weekly Outlook: USDA Projects Ample Crop Supplies
US - The USDA released its monthly report of US and world supply and demand projections for major crops on 10 July. The projections contained a number of changes from those of a month ago, but generally point to abundant crop supplies for the year ahead.



For soybeans, the USDA increased the projection of both the domestic crush and exports during the current year by 10 million bushels. Those increases were offset by an increase in the projection of imports and a smaller projection of residual use of soybeans. Year ending stocks are still projected at 110 million bushels.

The projection of 2008-09 marketing year soybean exports of 1.26 billion bushels could be exceeded. USDA estimates place cumulative marketing year exports through 2 July 2009 at 1.145 billion bushels. Those estimates suggest that weekly shipments through August need to average 13.4 million bushels per week to reach the new projection of 1.26 billion bushels for the year. However, Census Bureau estimates through May 2009 exceed USDA estimates by 35 million bushels. If that margin persists, weekly shipments need to average only 9.3 million per week. If all of the bushels which were sold but not yet shipped as of 2 July actually get exported, exports for the year could be as high as 1.3 billion bushels. Exports at that level point to an unreasonably small year ending inventory of 70 million bushels. The recent drop in old crop soybean prices suggests that the market is not concerned about old crop supplies, even with a late maturing crop. It now appears, however, that some additional rationing of old crop soybean supplies is needed or that the 2008 crop was actually larger than estimated.

For the 2009-10 marketing year, updated USDA projections reflect the larger soybean planted acreage figure released on June 30. With a yield of 42.6 bushels per acre, the 2009 harvest is expected to total 3.26 billion bushels. Stocks on 1 September 2010 are projected at 250 million bushels. The yield projection is slightly higher than our trend calculation of 42.2 bushels. The yield projection based on weather conditions through June and summer weather conditions that reflect an equal chance of the actual weather conditions of each of the last 49 years is also 42.2 bushels. The difference of 0.4 bushels is equal to 30 million bushels. The USDA projects the 2009-10 marketing year average farm price in a range of $8.30 to $10.30. The futures market currently reflects an average cash price for the upcoming year of just under $9.00.

For corn, the USDA lowered the projected domestic use during the current marketing year by 220 million bushels. Feed use and ethanol use projections each declined by 100 million bushels. The projection of 2008-09 marketing year corn exports was increased by 50 million bushels. Cumulative Census Bureau export estimates through May 2009 exceeded USDA projections by about 60 million bushels. Still, the export pace will have to accelerate to reach the projected total. Year ending stocks are now projected at 1.77 billion bushels.

For the 2009-10 marketing year, the projection of corn production was increased by 355 million bushels, reflecting the larger planted acreage estimate released on June 30. Stocks of US corn on 1 September 2010 are projected at 1.55 billion bushels, 468 million more than projected last month, but 220 million less than the projection of stocks at the beginning of the 2009-10 marketing year. The 2009-10 marketing year average farm price of corn is projected in a range of $3.35 to $4.15. The futures market currently reflects an average cash price near $3.25. The current price of corn likely reflects a higher average yield expectation than the 153.4 bushels projected by the USDA. Weather conditions through June and summer weather conditions that reflect equal chances of actual conditions in each of the last 49 years would point to an average yield near 155 bushels. Based on current weather forecasts and crop condition ratings, the market is likely trading an even higher yield expectation.

Changes in the projections for wheat point to larger year ending stocks. The US average yield projection was increased by 0.7 bushels. When applied to the larger acreage revealed on June 30, the yield forecast points to a crop of 2.112 billion bushels, 96 million larger than the June forecast. The marketing year export projection was increased by 25 million bushel and marketing year feed use was increased by 10 million. Still, year ending stocks are projected at an 8 year high of 706 million bushels.

If favorable crop weather continues, some further weakness in crop prices might be expected. The low price of wheat, along with a weak basis and large carry in the futures market, however, suggest retaining some ownership of the newly harvested soft red winter wheat crop. December 2009 corn futures are well below the price guarantee for crop revenue products which discourages additional new crop sales. November 2009 soybean futures are about $.30 above the crop revenue insurance price guarantee.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 26, 2009, 12:15:33 PM
 Korea to grow corn in the Philippines
[24 July 2009] The South Korean province of South Jeolla has leased a plot of farmland in the Philippines for 25 years to grow 10,000 tonnes of corn a year and is hoping to buy more in its effort to cut costs. Jeonnam Feedstock Ltd, a firm set up by the province has leased about 94,000 hectares of land in the Mindoro Province in the Philippines to grow low-cost grain for feed production, said Lim Young-muk, an official of South Jeolla's provincial government. South Korea, the world’s third largest buyer of corn for food and feed, imported 7.5 million tonnes of corn for feed in 2008. Mr Lim said they plan to start sowing in September this year. 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 29, 2009, 08:04:40 AM
Weekly Outlook: Corn Prices Looking For Direction
US - Corn prices have settled into a relatively narrow trading range, with December 2009 futures trading between $3.20 and $3.50 per bushel over the past three weeks.

 Chris Hurt
Extension Economist
Purdue University
 

The relatively low price level reflects the anticipation of a large harvest in 2009.

The USDA will release the first survey based corn yield projection on 12 August. That survey will also be used to update estimates of planted acreage of corn and acreage expected to be harvested for grain in 2009. The update of the acreage estimate is motivated by late planting in some states and the possibility that acreage deviated from June intentions. The consensus seems to be for at least a modest reduction in acreage compared to those intentions. Since acreage estimates for soybeans are also updated in August, the report will give some insight into the magnitude of unplanted acreage. Observation suggests that several thousand acres were not planted this spring, but this report will reveal if the total is large enough to alter production expectations of corn or soybeans.

The USDA will also update projections of corn consumption for the current and upcoming marketing years on 12 August. Recent information reveals a mixed bag for corn consumption during the current year. The USDA’s July Cattle on Feed report indicated that the inventory of cattle in feedlots with capacity of 1,000 head or more was 5.3 per cent smaller on 1 July 2009 than on 1 July 2008. The July Cattle report also confirmed some liquidation of both the beef cow and dairy cow inventories and a 2009 calf crop that is expected to be 1.4 per cent smaller than the 2008 calf crop. These smaller numbers all point to some weakness in feed demand for corn for the remainder of the current marketing year and into the 2009-10 marketing year.

US corn exports, on the other hand, have been relatively large in recent weeks. Export inspections for the week ended 23 July, for example, were reported at an unexpectedly large 52.234 million bushels. Census Bureau export estimates through May were about 50 million bushels larger than the cumulative export inspection estimate. If that margin has persisted, exports during the final 5.6 weeks of the 2008-09 marketing year need to average 36 million bushels per week to reach the USDA projection of 1.8 billion bushels.

It is generally expected that the August USDA reports will continue to point towards an ample supply of corn for the 2009-10 marketing year. The state by state yield projections, along with the marketing year average farm price projection, will have important implication for those who are evaluating the Average Crop Revenue Election (ACRE) program. Prospects for a 2009-10 average farm price well below the average for 2007-08 and 2008-09 increases the expectation that ACRE payments could be triggered at the state level in 2009-10, even if state average yields are relatively high. Prospects for a relatively low yield in any state will increase the likelihood that ACRE payments will be triggered. Prospects for a lower price will also increase expectations that farm level payments will be triggered, although prospects for farm level yields will have to be evaluated carefully. Unusually high average farm yields could offset the impact of a lower price.

If a large corn crop does materialize in 2009 and prices remain low through harvest, crop revenue insurance payments may also be triggered, particularly for those producers who experience lower yields. A combination of crop revenue insurance payments and ACRE payments could help offset the financial impact of lower average corn prices during the year ahead. For now, additional sales of 2009 crop corn are not appealing. December futures remain well below the crop revenue insurance guarantee. With the market generally expecting a very large 2009 harvest, additional downside price risk may be minimal for the time being.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 06, 2009, 08:43:27 AM
6 August 2009] The US Grains Council (USGC) announced that exports of US distiller's dried grains with solubles (DDGS) will hit record levels in 2009. Last year, approximately 8,000 tonnes of US DDGS were imported by China. Cary Sifferath, USGC Director in China said the huge jump in imports would not be possible without the USGC members and programs, adding that sponsoring DDGS workshops in China and bringing teams to the United States to showcase the high quality of US DDGS helped in building a market for US DDGS in China. The council’s Beijing office estimated that 135,000 tonnes have been sold to China for August and September shipments.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 09, 2009, 07:15:04 AM
The South Korean province of South Jeolla has leased a plot of farmland in the Philippines for 25 years to grow 10,000 tonnes of corn a year and is hoping to buy more in its effort to cut costs. Jeonnam Feedstock Ltd, a firm set up by the province has leased about 94,000 hectares of land in the Mindoro Province in the Philippines to grow low-cost grain for feed production, said Lim Young-muk, an official of South Jeolla's provincial government. South Korea, the world’s third largest buyer of corn for food and feed, imported 7.5 million tonnes of corn for feed in 2008. Mr Lim said they plan to start sowing in September this year.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 14, 2009, 08:21:53 AM
AFBF: Report Bearish for Corn, Neutral for Soybeans
US - The Agriculture Department is forecasting a record US soybean crop and the second-largest corn crop ever. But thanks to tight global soybean supplies, soybean prices should be under less pressure than corn prices where the huge crop is giving a bearish tone to the market, according to Terry Francl, senior economist with the American Farm Bureau Federation.



USDA yesterday released its first forecast of the fall harvest based on field surveys, which makes it particularly significant for the market as producers begin to set their sights on harvesting and selling their crops, Francl said.

"The overall tenor of the report was bearish for corn and wheat and neutral to slightly supporting to the soybean market," Dr Francl said. "With regard to corn, the old adage ‘that big crops tend to get bigger’ is likely to prevail in the market, unless some unforeseen weather problems develop."

After a difficult spring planting season, growing conditions turned to anywhere from good to excellent.

"The most likely weather issue that might occur would be a freeze that could reduce yield prospects, given the late development of the corn and soybean crops," Dr Francl said. "However, it is at least a month, if not six weeks before that might become a probability."

Because of the huge corn crop, Dr Francl thinks corn prices will remain under pressure going into harvest. But a tight supply and demand balance for soybeans will provide some support to soybean prices, particularly for the next six months, before the South American crop is harvested and ready for export.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 17, 2009, 10:51:36 AM
17 August 2009] The Philippine Maize Federation Inc is putting up a PHP 250 million (USD 5.23 million) large-scale postharvest facility in Isabela Province, and is calling for more to be established in other parts of the country to help local corn farmers cope with the zero duty on corn and reduced tariffs on commercial feeds beginning next year, a report from the Philippine Daily Inquirer said. The new facility will have a mechanical drying and bulk handling system that can process corn from as much as 30,000 hectares of farmland. The current yield per hectare is about 2.8-2.9 tonnes. Philmaize President Roger Navarro said that one way for the country to cope would be to export, but the local industry cannot do this because of lack of infrastructure. He said there are very few such facilities in the country, including two big ones in Bukidnon Province in Mindanao and another in Luzon, and the local corn industry needs to be more competitive.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 18, 2009, 09:06:53 AM
[18 August 2009] Philippine corn farmers have complained that the Department of Agriculture (DA) has not made good on its promise to buy more of its produce. The Philippine Maize Federation (Philmaize) said that the government had earlier assured corn farmers that it will buy some 300,000 tonnes of yellow corn at a support price of PHP 13 (USD 0.27)/kg through the National Food Authority. In a report in the BusinessMirror, DA Assistant Secretary Dennis Araullo disputed the claims, saying that the government is actually exploring the possibility of increasing their purchases. However, he also said that local corn farmers have not been complying with the 14% moisture content, thus they are unable to buy the corn.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 19, 2009, 08:33:24 AM
Weekly Outlook: Corn, Soybean Production Forecasts
US - The USDA’s first forecasts of the season show potential for a 2009 US average corn yield of 159.5 bushels and a crop of 12.761 billion bushels. For soybeans, the US average yield forecast came in at 41.7 bushels, resulting in a production forecast of 3.199 billion bushels, writes Darrel Good, Agricultural Economist at the University of Illinois.



The USDA’s corn yield forecast, based on a combination of producer surveys and objective yield data collected in 10 states, is 4.6 bushels above the trend yield for 2009 and only 0.4 bushels below the record yield of 2004. Based on the adage that large crops tend to get larger, there is some expectation that the yield forecast will increase in subsequent Crop Production reports. There is, in fact, evidence that large yield forecasts in August tend to be followed by larger forecasts in subsequent reports. The most comprehensive analysis of that pattern is provided by a study by Isengildina, Irwin, and Good published in 2006.

For the current year, there is mixed evidence of corn yield potential. Some severe hail damage in key Iowa growing areas and some very dry weather in other corn growing areas during the first half of August may have reduced yield potential. In addition, the USDA’s weekly report of crop conditions in the 18 largest corn growing states have shown some modest deterioration in overall crop condition ratings. The per centage of the crop rated good or excellent peaked at 72 per cent for the week ended 28 June. For the week ended 9 August, 68 per cent of the crop was rated in either good or excellent condition, only one per centage point higher than the rating of the 2008 crop a year ago.

We have estimated a model that explains US average yield based on trend (time), per cent of the crop planted after 20 May, and per cent of the crop rated good or excellent at the end of the season. That model explains 97 per cent of the variation in annual yield from 1986 through 2008. Based on August 9 crop condition ratings, that model projects a 2009 US average yield of 158.2 bushels. That projection should be used with caution because crop condition ratings will likely change and because there is some forecast error associated with the model.

We have also developed a crop weather model to explain and forecast state average corn yields in Illinois, Indiana, and Iowa. Average yield forecasts in those three states are used to forecast the US average yield. Based on trend yield, planting progress of the 2009 crop, preliminary weather data through July 2009 and the assumption of average August weather, that process results in a 2009 yield forecast of 165.3 bushels. Again, these results should be used with caution because of unknown weather for the rest of the year and because of the relatively large standard error of the model estimates. For a more complete explanation, see the recent report by Irwin, Good and Tannura.

At this juncture, slightly higher yield and production forecasts in September and/or October would not be a surprise. Larger crop forecasts would likely keep some pressure on corn prices into the harvest period. In addition, the USDA forecasts of 2009-10 marketing year consumption of US corn appear generous. Beyond harvest, corn prices will be influenced by the revealed rate of consumption and the extent of US and world economic recovery.

For soybeans, the USDA’s yield forecast is tied with the 2007 yield as the fourth largest. The forecast is 1.4 bushels below the record yield of 2005 and 0.5 bushels below trend value for 2009. The forecast should not be considered a large forecast. While early August weather has not been perfect, both the crop condition ratings of August 9 and our crop weather model assuming average August weather point to a higher average yield in 2009. Those models point to yield of 44.1 and 43.6 bushels, respectively. Those forecasts should be used with caution for the same reasons as identified for corn. For more details of these forecasts, see the recent report by Irwin, Good and Tannura.

In addition, the late maturing crop may be at more risk to late season weather events. The USDA reported only 55 per cent of the crop setting pods as of 9 August. That compares to the previous 5 year average for that date of 72 per cent, which includes the relatively small 57 per cent of a year ago.

Absent, an early end of the 2009 growing season, larger soybean yield and production forecasts in subsequent reports would not be a surprise. Additional price weakness into harvest would be expected under such a scenario.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 21, 2009, 08:59:17 AM
[20 August 2009] The latest World Agricultural Supply and Demand Estimates of the US Department of Agriculture indicated that US corn production for 2009/10 to be 324.14 million tonnes, with the overall supplies to increase to 368.19 million tonnes, according to a weekly commodity report by Amit Sacdev, India Representative of the US Grains Council. He said corn use for feed  is expected at 134.62 million tonnes, while food, seed & industrial use is expected at 139.09 million tonnes. Corn use for ethanol is expected at 110.21 million tonnes. Ending US corn stocks are expected at 41.19 million tonnes, up from July estimates of 39.37 million tonnes
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 30, 2009, 09:27:38 AM
[28 August 2009] The Philippine Department of Agriculture, through the National Food Authority (NFA), will sell yellow corn to Vietnam this year. NFA Administrator Jessup Navarro said that the Philippines is ready to import 50,000-10,000 tonnes of corn from Isabela, Pangasinan, Mindoro and Bukidnon provinces. Businessworld reported that the Vietnam Food Association said on Friday that the country would buy as much as 500,000-800,000 tonnes of corn from the Philippines. Meanwhile, DA Secretary Arthur Yap said that the agency has already reached an agreement with local corn farmers for the purchase of corn at PHP 10 (USD 0.21)/kg, saying that the NFA will double its procurement target to 600,000 tonnes to meet the export demand. Corn harvest in the Philippines is expected to reach about 802,964 tonnes in the second half of 2009, up from 656,723 tonnes harvested during the same period last year.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 02, 2009, 07:37:23 AM
Weekly Outlook: Price Pattern for Corn and Soybeans
US - With large US corn and soybean crops expected this year, the strength of demand and the resulting rate of consumption will be important for post-harvest price prospects, writes Darrel Good, Agricultural Economist at the University of Illinois.



Demand and consumption are not interchangeable terms. Consumption results from the size of the crop, the strength of demand, and the resulting price level. All else equal, larger supplies result in lower prices and a higher rate of consumption. Conversely, all else equal, an increase in demand results in higher prices while consumption may or may not increase depending on the available supply.

For both corn and soybeans, the export sector is one that can be monitored frequently prior to and during the marketing year. The USDA provides weekly estimates of export inspections and weekly reports of export sales. For the upcoming marketing year, the USDA currently projects US corn exports at 2.1 billion bushels. That projection is 337 million less than the record exports of the 2007-08 marketing year, but 250 million above the projection for the 2008-09 marketing year that ends on 31 August 2009. The USDA expects a year-over-year increase in corn exports due to smaller coarse grain crops outside of the US and larger imports by Mexico and Taiwan. Coarse grain production outside the US in 2009-10 is projected at 751.7 million tons, nearly 3 per cent smaller than production during the 2008-09 marketing year. Smaller crops are expected in Canada, the European Union, China, and Mexico. Production is expected to rebound in Argentina following the weather reduced harvest this year.

As of 20 August 2009, the USDA reported that 284 million bushels of US corn had been sold for export during the 2009-10 marketing year. A year ago, new crop sales on the same date stood at 344 million bushels. The difference in new crop sales so far this year is primarily to Japan. The USDA reports that only 19.5 million bushels of US corn have been sold to Japan for delivery in the upcoming marketing year. A year ago, new crop sales stood at 107 million bushels. Sales to all other destinations are slightly larger than those of a year earlier. A slower start to Japan’s buying program is not a concern. Japan is the largest and most consistent importer of US corn, but the timing of their purchases varies each year. To reach the USDA’s projection of 2009-10 marketing year exports, weekly sales to all destinations need to average about 34 million bushels per week over the next 12 months.

For soybeans, the USDA projects 2009-10 marketing year US exports at 1.265 billion bushels, equal to the record exports expected for the year ending on 31 August 2009. US exports are expected to be supported by increased world soybean consumption, smaller exports from Brazil, and larger imports by Southeast Asian countries. A rebound in soybean production in Argentina in 2010 would provide more competition for US soybeans during the last half of the marketing year.

As of August 20, 2009, the USDA reported that 477 million bushels of US soybeans had been sold for export during the upcoming marketing year. That compares to new crop sales of a year ago of 271 million bushels. The largest year-over-year increase in sales is to China. Those sales totaled 309 million bushels as of 20 August, 156 million larger than cumulative sales of a year ago. New crop export sales to China totaled 56 million bushels during the week ended August 20, 2009. Export sales to all destinations need to average about 15 million bushels per week over the next 12 months in order to reach the USDA projection. Because of the seasonal pattern of US sales and shipments, new sales over the next 5 months need to average about double that rate to be on track to reach the USDA projection. Export sales already total about 38 per cent of the USDA’s projection for the year. That is double the average per centage of the previous 5 years.

The rate of corn consumption in other categories, ethanol production and feed use, will be revealed less frequently and with more severe time lags. Monthly reports of ethanol production will indicate the rate of corn use in that category. Feed use will be revealed only in the quarterly USDA Grain Stocks reports. The first of those will not be released until the second week of January 2010. For soybeans, the domestic crush rate will be revealed in the monthly reports by the National Oilseed Processors Association and the Census Bureau.

It now appears that consumption of US corn and soybeans will be record large in the 2009-10 marketing year. The price that the users will be willing to pay for those crops will depend to a large degree on the extent of recovery in the US and world economies. If recovery does occur, a modest increase in prices would be expected following the harvest of large crops.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 04, 2009, 08:11:15 AM
4 September 2009] Philippine corn farmers are looking to Monsanto Philippines Inc to come up with a genetically modified soybean suitable for tropical conditions to help stabilise supply. Philippine Maize Federation (Philmaize) Chairman emeritus Roderico Bioco said that there is a big market for soybean, being both a basic food and feed ingredient. Mr Bioco said they are asking Monsanto to develop a tropical variety and hope to sign a deal with the company late this year. Philmaize said that following the government's failure to help local corn farmers, many are already considering shifting to planting other crops, including soybeans. Philmaize President Roger Navarro said “soybean is far more practical and farmers will earn better by planting soybean instead of corn.” Furthermore, he said soybean can act like a natural fertiliser as it enriches the soil.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 09, 2009, 11:28:33 AM
[7 September 2009] Philippine corn farmers are up in arms against the government's decision to reduce its buying price from PHP 13 (USD 0.27)/kg to PHP 10 (USD 0.20)/kg. Philippine Maize Federation President Roger Navarro said that the decision was made by the Department of Agriculture without consulting corn farmers. He said Mr Yap consulted only with corn farmers in Isabela province in August and then announced that the government will double its corn procurement target to 600,000 tonnes, but at the lower price. Mr Navarro said this price should only apply to Isabela farmers and not to corn farmers in the rest of the country. However, Mr Yap said that when the buying price was raised to PHP 13/kg last year, they also did not consult the farmers, but only took into consideration the high fertiliser prices. He said that private traders are currently buying corn at PHP 6-7.50 (USD 0.12-0.15)/kg, so at the current government support price of PHP 10/kg, the farmers are still making money.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 09, 2009, 11:29:51 AM
8 September 2009] The Philippine Department of Agriculture is constructing a PHP 35 million (USD 714,700) corn centre in Zamboanga del Norte in Mindanao to help ensure the continuous supply of corn in the region even during the wet season. The new centre is targeted to begin operations before the end of 2009. It is the third corn centre in the Zamboanga peninsula, which already has another in Zamboanga del Norte and one in Zamboanga del Sur. The region has about 185,000 hectares of corn farms, with more than 200,000 hectares of potential areas for corn expansion.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 11, 2009, 11:02:32 AM
11 September 2009] The tight supply of soybean in the world market is likely to remain at least until February 2010, said Mr Thomas Mielke, Executive Director of ISTA Mielke GmbH. Speaking at the 6th SE Asia US Agricultural Cooperators Conference in Cebu, Philippines organised by the American Soybean Association and the US Grains Council, Mr Mielke said that as of end-August, soybean stocks was down 13.5 million tonnes. While US soybean production is expected to improve in the current crop season, this will not be enough to compensate for the decline in soybean production of South America (Argentina, Brazil and Paraguay), which experienced its worst drought in 70 years. Soybean production in South America is expected to recover strongly to about 123 million tonnes early in 2010, but this will not be available until end-February 2010 onwards.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 15, 2009, 08:19:48 AM
USDA Forecasts Second-Largest Corn Crop
US - The USDA's World Agricultural Supply and Demand Estimates (WASDE) predicts the second-largest corn crop, record yields and exports up by 100 million bushels.



In a press release from US Grains Council, Julius Schaaf, its at-large director, said he expects to harvest one of the best corn crops ever on his Randolph, Iowa, farm. Mr Schaaf is not alone. USDA's World Agricultural Supply and Demand Estimates (WASDE) released on Friday forecasts 13 billion bushels of corn, the second-largest crop in history, a record-setting yield and a 100 million bushel increase in exports.

"We produce more on fewer acres," said Mr Schaaf. "It is because we deploy sound science when making our planting decisions. Because of biotechnology we can meet all demands domestically and around the world."

US corn production is estimated 193 million bushels higher than last month's report. USDA reported the national average yield is projected at a record 161.9 bushels per acre. US corn exports for 2009/2010 are raised 100 million bushels due to higher projected imports for Canada and lower production in South America and China. Based on record July and August production of gasoline blends with ethanol, as reported by the Energy Information Agency, beginning stocks are lowered 25 million bushels reflecting higher anticipated corn use for ethanol in 2008/2009.

Sorghum production for 2009/2010 is forecast up nine million bushels and beginning stocks projected down 10 million bushels based on a 10 million bushel increase in 2008/2009 exports. Sorghum exports are projected to remain steady at 140 million bushels due to stable demand in Mexico. Barley 2009/2010 exports, although down from 2008/2009, remain firm from the last report at 15 million bushels.

USGC president and CEO, Ken Hobbie, said the United States is more than capable of supplying the necessary feed grains both domestically and abroad.

He said: "US agricultural production will become increasingly vital to feeding a hungry world as US export competitors' production drops due to poor weather conditions.

"We are proud of US farmers for once again stepping up to the challenge of producing more coarse grains to satisfy all demands."


Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 16, 2009, 08:57:33 AM
Weekly Outlook: Corn and Soybean Supply Prospects
US - Corn and soybean prices will continue to be influenced by a wide range of factors. For the next few weeks, the prospective size of the US harvest will be one of the dominating price factors, writes Darrel Good, Agricultural Economist at the University of Illinois.



For corn, the USDA’s September forecast placed production potential at 12.955 billion bushels, 194 million larger than the August forecast. The larger forecast reflects a US yield forecast of 161.9 bushels, 2.4 bushels higher than the August forecast. Large increases in expected yields were registered for Illinois, Kentucky, Michigan, Missouri, and South Dakota. The US forecast yield is record large and expected production is only slightly smaller than the record crop of 2007.

In general, the market anticipates that the US average yield forecast will increase again in October, IF the majority of the crop escapes a killing frost before maturity. The western corn belt states may have the most potential for further yield increases. There is less consensus about the potential change in the corn production forecast in October. That report will incorporate “administrative” acreage information, mostly certified acreage data from the Farm Service Agency. Some believe that, like last year, the estimate of planted and harvested acreage will be reduced next month due to the late, wet spring in the eastern corn belt.

While the corn production forecast continues to increase, the USDA once again raised the forecast of expected consumption of US corn during the current marketing year. Feed and residual use is now projected at 5.35 billion bushels, 50 million larger than the September forecast and 100 million bushels larger than use projected for the 2008-09 marketing year. Projected use is well below the record of 6.157 billion bushels of five years ago, reflecting the impact of reduced livestock numbers and a sharp increase in feeding of distiller grain. The year over year increase in expected use is in the residual category, as handling losses increase with a larger crop. Still, another large increase in distiller’s grain production this year makes the forecast look generous.

US corn exports during the current marketing year are projected at 2.2 billion bushels, 100 million larger than projected last month and 350 million larger than exports for the year ended on August 31, 2009. The increase this month is based on prospects for a smaller crop and larger imports by Canada and a smaller crop and smaller exports by Argentina in 2010. The US share of world corn exports is expected to grow from 60 per cent last year to 65 per cent this year as corn production outside the US declines by about 3 per cent.

The larger production forecast was also partially offset by a 25 million bushels reduction in the expected size of September 1, 2009 stocks of old crop corn and by a 5 million bushel reduction in expected imports. Still, the larger crop is expected to result in lower prices than forecast last month. The midpoint of the USDA’s forecast of the 2009-10 average price received by producers is $3.35, $.15 lower than projected last month.

For soybeans, the US crop is now projected at a record 3.245 billion bushels, 46 million bushels larger than the August forecast. The US average yield is projected at 42.3 bushels, 0.6 bushels above the August forecast. Yield forecasts for the corn belt states were mostly unchanged from last month, with the exception of Indiana where a 2-bushel reduction was registered. Yield forecasts were increased for all of the plains states, Missouri, and several southeastern states. Another modest increase in the yield forecast is expected in October, but the production forecast will also be influenced by any changes in acreage estimates.

The USDA increased the forecast of consumption of US soybeans during the current marketing year by 36 million bushels. A larger crush is expected to result from larger soybean meal exports, which result from prospects of smaller exports from India. Larger soybean exports are expected to result from larger imports by China and from lower soybean prices. The midpoint of the USDA’s projection of the marketing year average price received by producers is $ 9.10, $.30 below the August projection.

In comparison to USDA’s farm price forecasts of $3.35 and $9.10 for corn and soybeans, respectively, the futures market currently points to an average price of about $3.00 for corn and $8.85 for soybeans.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 17, 2009, 08:57:03 AM
17 September 2009] The Philippine Department of Agriculture (DA) will double its corn procurement volume from 300,000 tonnes to 600,000 tonnes to help local corn farmers. DA Secretary Arthur Yap said that the government will buy half the volume at PHP 10 (USD 0.21)/kg and the other half at PHP 12.50 (USD 0.26)/kg to help support local prices and protect farmers' income. Figures from the Bureau of Agricultural Statistics show that in the first week of September, traders and private buyers of local corn were paying farmers PHP 8.58/kg (USD 0.18), down from PHP 10.44/kg (USD 0.22) earlier this year. The current market price falls below the production cost of PHP 9.50/kg (USD 0.20). In August, the Philippine Maize Federation called on the government to increase its buying price to encourage local farmers to plant corn.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 18, 2009, 09:27:17 AM
18 September 2009] The Philippine Department of Agriculture said that local corn production is expected to go up by 6% in 2010 to 7.51 million tonnes as it will be boosted by demand from the hog and poultry sectors. Agriculture Assistant Secretary Dennis Araullo, who also heads the government's corn program, said that election spending next year will increase the Filipinos' purchasing power and drive up demand for chicken and pork meat, which will spur growth in the poultry and hog industries. However, corn industry officials have raised doubts about achieving this target, saying the current low prices of corn in the local market might discourage farmers from planting corn.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 07, 2009, 10:51:59 AM
Weekly Outlook: Early Corn and Soybean Exports
US - The USDA has projected that corn exports will rebound sharply during the current marketing year, writes Darrel Good, Extension Economist at the University of Illinois.



Exports of US soybeans are expected to be maintained at the record level of the 2008-09 marketing year.

Corn exports during the 2009-10 marketing year are projected at 2.2 billion bushels, 237 million below the record exports during the 2007-08 marketing year, but 350 million above exports during the 2008-09 marketing year. The US share of the world corn export market is expected to increase from 60 per cent last year to 65 per cent this year. A larger US share of the world export market reflects prospects for smaller crops in the exporting countries of Canada, South Africa, and China. In addition, total world trade of corn is expected to grow by about 275 million bushels (nearly 9 per cent) due to smaller crops in Europe and Mexico and growing consumption in China.

Soybean exports during the current marketing year are projected at 1.28 billion bushels, equal to exports during the 2008-09 marketing year. The US share of the world soybean export market is projected at 45 per cent, about equal to that of last year as world soybean trade is expected to increase by only 25 million bushels (about 0.9 per cent). Larger imports by Japan and Mexico are expected to be offset by smaller imports by Western Europe and China.

One of the major factors that will influence export demand for US soybeans during the last half of the 2009-10 marketing is the size of production in Argentina and Brazil. Production in Argentina in 2009 was down 31 per cent from production in 2008 due to dry weather conditions. Production in Brazil dropped about 7 per cent. As a result of smaller production, Argentine exports dropped from about 510 million bushels to about 220 million bushels. Soybean exports from Brazil, however, increased from about 930 million bushels in 2007-08 to about 1.08 billion in 2009-10. Inventories were reduced sharply in both countries.

For the 2010 harvest, the USDA has projected a 2 million acre increase in soybean plantings in Brazil and a 5 million acre increase in Argentina. A return to more normal yields would result in production increases totaling about 700 million bushels in Argentina and 185 million bushels in Brazil. The USDA expects Argentine exports to increase by 140 million bushels and Brazilian reports to decline by 180 million bushels during the 2009-10 marketing year. Prospective supplies would allow for larger exports from both countries than is currently projected. Decisions by importers on sourcing soybeans will be important in determining if US exports remain record large.

The USDA weekly reports of export inspections and export sales provide the information to monitor the pace of export activity relative to projected exports for the year. Corn export inspection through the first 4.5 weeks of the marketing year were reported at 182 million bushels about 16 million above the total of a year ago. Inspections need to average about 42 million bushels per week to reach the USDA projection for the year. As of September 24, 2009, the USDA reported that 466 million bushels of US corn had been sold for export, but not yet shipped. That exceeds outstanding sales of a year ago by about 60 million bushels. The early pace of US corn activity is encouraging, but will need to accelerate to stay on track with the USDA projection for the year.

US soybean export inspections during the first 4.5 weeks of the marketing year were reported at 39 million bushels, about equal to that of a year ago. Shipments are typically small during the first 5 or 6 weeks of the marketing year as South American exports dominate. As of 24 September 2009 the USDA reported that 714 million bushels of US soybeans had been sold for export, but not yet shipped. That total is nearly double the total on the same date last year. The large increase in outstanding sales is to China (up 120 per cent) and unknown destinations (up 290 per cent). China has purchased 450 million bushels of US soybeans for import during the current marketing year, accounting for 61 per cent of all US export sales. As a result, sales of US soybeans have reached nearly 60 per cent of the USDA’s projected exports for the year. The current pace of export sales cannot be maintained, but the large sales to date suggest that the USDA’s projection will be reached, if not exceeded.

While early export prospects for corn and soybeans are encouraging, the size of the US corn and soybean crops will dominate prices for the next several weeks. The USDA will update production forecasts on 9 October.





Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 13, 2009, 07:36:56 AM
, October 12, 2009Print This Page
CME: Larger-than-Expected Corn Production Indicated
US - USDA’s monthly Crop Production report and World Agricultural Supply and Demand Estimates, released on Friday, indicated larger- than-expected corn production and smaller-than-expected soybean output this fall, write Steve Meyer and Len Steiner.



The soybean numbers were farther from average prereport estimates and drove CME Group Soybean futures 22 to 28 cents/bushel higher for the 2009-2010 crop year. Soybean meal futures also rose by $5 to $7.60/ton while soybean oil futures gained $0.61 to $0.64 per cwt.

USDA lowered 2009 ending corn stocks to 1.674 billion bushels to reflect last week’s Grain Stocks report. It also lowered its estimates of both planted and harvested acres for corn from September levels. Both are still larger than in 2008. USDA’s projected average yield of 164.9 bu./acre was over 2 bushels higher than the average pre-report estimate (162.7) and represents a new record corn yield. The higher yield more than offsets lower harvested acres to give an estimated corn crop of 13.018 billion bushels, again a record. Feed and residual usage was increased by 50 million bushels while exports were decreased by the same amount. Other minor changes left projected total usage at 13.03 billion bushels — another record. Still, the projected 2010 year-end stocks-to-use ratio is over 1 per cent lower than this year’s level. USDA’s forecasted range for the national weighted average farm price of corn did not change from the September report. The mid-point of that range, $3.35/bushel is 18 per cent lower than last year’s projected average price, reflecting lower corn demand primarily driven by lower oil and ethanol prices.


USDA’s projected year-end stocks of soybeans, increased to 138 million bushels to reflect the Grain Stock report, leave us economists encouraged. They indicate that prices indeed do ration scarce supplies! Tight projected year-end stocks have kept beans and bean product prices high all summer and they apparently worked. Isn’t it great when reality aggress with theory!

The soybean forecasts were definitely closer to the low end of pre-report estimates even though USDA’s predicted yield of 42.4 bushels per acre would be the second largest ever and the projected crop of 3.25 billion bushels will be the largest ever. Higher crushings and exports both use a portion of that larger crop but 2010 year-end stocks are now forecast to be 230 million bushels, two-thirds larger than this year and representing 7.3 per cent of projected usage.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 19, 2009, 06:25:29 AM
Saturday, October 17, 2009
Weekly Review: Record High 2009 Soybean Crop Estimated
US - Weekly review of the US hog industry, written by Glenn Grimes and Ron Plain.

 
Ron Plain
The October estimate of the 2009 corn crop is for a production of 13.018 billion bushels -- quite close to the record of 13.038 billion bushels in 2007. The estimated yield for corn in 2009 is 164.2 bushels per acre -- a very substantial increase from the previous record of 160 bushels per acre.

The USDA midpoint estimate for corn prices is $3.30 per bushel, the same as a month earlier but down $0.76 per bushel from the 2008-09 marketing year.

The 2009 soybean crop is estimated to be a record high 3.25 billion bushels. The USDA midpoint estimate for bean prices is $9.00 per bushel, down from $9.97 per bushel in the 2008-09 marketing year.

The midpoint estimate for soybean meal prices for the 2009-10 marketing year is $275 per ton compared to $331.17 per ton a year earlier.

These lower feed prices will reduce the cost of producing hogs by $3-4 per cwt but not nearly enough to erase the red ink of the past year. Therefore, the breeding herd needs to be reduced substantially more than the reductions in the 1 September report.

For the last couple of weeks, gilt and sow slaughter data is not positive for an increase in the rate of decline in the breeding herd.

Pork exports in August were down 18.4 per cent from a year earlier. For January-August pork exports were down 19.2 per cent from 12 months earlier. Pork imports for January-August were down 2.3 per cent form the same months in 2008. However, even with the smaller imports the net pork exports as a per cent of production were 14.1 per cent, down from 17.8 per cent in 2008.

The value of pork exports per hog slaughtered for January-August at $38.46 per head is down from $42.11 per head for the same period last year.

The average live weight of barrows and gilts last week in Iowa-Minnesota was 268.9 pounds per head, up 0.5 pound from a week earlier and up 3.2 pounds from a year earlier.

Pork product cutout bucked the seasonal trend this week with an increase of $3.33 per cwt and amounted to 56.20 per cwt. Loins at $68.85 per cwt were up $1.61 per cwt, Boston butts at $59 per cwt were up $2.96 per cwt, hams at $47.68 per cwt were up $6.48 per cwt, and bellies at $66.85 per cwt were down $0.01 per cwt from a week earlier.

National feeder pig prices last week were generally steady. The average price for 50-54 per cent lean pigs weighing 10 pounds was $30.90 per head and 40-pound pigs were 31.89 per head. The formula-price for 10-pound pigs averaged $33.96 per head and for 40-pound pigs averaged $44.96 per head. The negotiated or cash price for 10-pound pigs averaged $25.42 per head and 40-pound pigs averaged $30.71 per head.

The prices for live slaughter hogs Friday morning were $0.50 per cwt higher to $1.00 per cwt lower compared to a week earlier. The weighted average negotiated carcass prices were $0.42 to $0.98 per cwt higher compared to seven days earlier.

The live prices Friday morning were: Peoria $29 per cwt, Zumbrota, Minnesota, $31 per cwt, and interior Missouri $35 per cwt. The weighted average negotiated carcass prices by area Friday morning were: western Cornbelt $49.07 per cwt, eastern Cornbelt $47.15 per cwt, Iowa-Minnesota $49.20 per cwt and nation $47.93 per cwt.

Slaughter this week under Federal Inspection was estimated at 2295 thousand head, down 2.6 per cent from the same week in 2008.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 19, 2009, 06:27:30 AM
China’s CNGOIC cuts corn output forecast
[19 October 2009] China National Grain and Oils Information Centre (CNGOIC) has lowered its forecast for the country's corn output in 2009 to 163 million tonnes, a drop of 2.92 million tonnes or 1.8% from last year, due to severe drought in the country's major growing areas in the northeast. The adjusted figure - down 2.5 million tonnes from September estimate - was still higher than USDA estimates and other industry bodies that put it at 160 million tonnes or below. "Northeast areas will see a fall in output while the provinces in north China will produce more than last year," said an official at the centre.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 04, 2009, 11:05:46 AM
Tuesday, November 03, 2009Print This Page
Weekly Outlook: Harvest to Accelerate
US - The late planted and late maturing corn and soybean crops of 2009 have also experienced one of the slowest harvest rates in modern history, writes Darrel Good, agricultural economist at the University of Illinois.



For corn, an average of 58 per cent of the crop had been harvested by that date in the previous 5 years. Excluding the slow pace of 2008, the average for that date was 63 per cent harvested. For soybeans, the previous 5-year average harvest pace for that date is 80 per cent. The rate of harvest relative to the previous 5 year average pace varied considerably by state and within states. The slowest pace of corn harvest was in Illinois, with only 14 per cent harvested as of 25 October, compared to the previous 5 year average of 77 per cent. The per cent of the crop harvested ranged from 3 per cent in the northeast crop reporting district to 38 per cent in the southwest district. Excluding 2008, the previous average harvest completion by that date was 85 per cent. Harvest was at a more normal pace in the southern states of North Carolina, Tennessee, and Texas. Soybean harvest was especially slow in Illinois, Iowa, Minnesota, North Dakota, and South Dakota. The pace of harvest was near normal in Ohio.

Some additional harvesting occurred during the week ended 1 November, but the pace was likely very slow. The per cent of the crop harvested will be reported in the USDA’s Crop Progress report to be released on 2 November. The current week may result in the fastest pace of harvest so far this year. The Midwest is expected to be generally rain free, allowing harvest to pick up speed as the week progresses. The pace will vary geographically, reflecting various levels of precipitation received last week.

For corn, the most rapid weekly rate of harvest in recent years has resulted in 16 per cent of the crop being harvested. Those peak weeks tended to be in the middle of harvest when the majority of farms were still harvesting. The harvest rate declined as more producers completed harvest. Assuming only about 25 per cent of the crop was harvested as of 1 November, a harvest pace of 16 per cent per week would require almost 5 weeks to complete the harvest. Since the pace cannot be maintained at 16 per cent per week, it appears that harvest will stretch into at least mid-December, depending on future weather conditions. The pace of harvest will also be influenced by the rate at which the crop can be conditioned for storage and shipping. Areas with a majority of the crop still at high moisture levels could experience some delays due to limited drying capacity.

For soybeans, the peak weeks of harvest in recent weeks have seen 20 to 24 per cent of the crop harvested. With perhaps 50 per cent of the crop harvested by 1 November, it still appears that harvest could extend into December, depending on weather conditions after this week.

The delayed harvest due to wet conditions raises several issues about the quantity and quality of the 2009 crop, particularly the corn crop. More widespread disease outbreaks, low test weights, above average field losses, and quality deterioration due to drying and handling a crop with high moisture levels have all been cited as potential problems. In addition, extreme weather conditions in some areas may result in more than the average amount of unharvested acreage.

The USDA’s 10 November Crop Production report will provide an important benchmark for judging the yield impacts of poor harvest conditions. The impact of a poor quality crop will be revealed over a longer period of time. Typically, the impact of corn quality on livestock feeding rates could be evaluated based on the 1 December inventory of corn, with higher feeding rates associated with poor quality. With more than the normal amount of the crop likely to be unharvested by 1 December, the estimate of December 1 stocks may be less reliable than in a more normal year. The 1 March inventory estimate, then, becomes more important.

For soybeans, the wet growing season in many areas along with higher moisture levels at harvest, may affect the relative meal and oil content of the crop. The industry will have information on relative yields immediately, but the monthly Census Bureau estimates of soybean crush and product yield will reveal the overall impact.

The impacts of late harvest and poor quality crops on production and use are often over estimated. It appears that may have been the case this year, with prices of both corn and soybeans dropping sharply with the forecast of more favorable harvest conditions. However, this year’s growing and harvest season weather conditions are outside the experience of modern history. More time will be required to fully evaluate the impacts.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 17, 2009, 11:45:45 AM
Monday, November 16, 2009Print This Page
Weekly Outlook: Soybean and Corn Crop Forecasts
US - The USDA's November Crop Production report forecast the size of the 2009 US soybean crop at 3.319 billion bushels, 69 million bushels larger than the October forecast, writes Darrel Good, agricultural economist at the University of Illinois.



The 2009 corn crop is forecast at 12.921 billion bushels, 97 million bushels smaller than the October forecast,

The US average soybean yield is now forecast at 43.3 bushels per acre, 0.9 bushels higher than the October forecast. The largest month-over-month increase in average yields came in Indiana and Kansas. Those yield estimates were increased by 3 bushels. Average yield estimates were lowered for some southern states, including Arkansas, Georgia, Mississippi, and Texas, and for Iowa. The US average yield forecast is 1.1 bushels below the average of forecasts based on our crop weather and crop condition models.

The USDA also increased the expected size of the 2010 harvest in Brazil, Argentina, Paraguay, Bolivia, and Uruguay. The South American harvest is now forecast at 4.623 billion bushels, 80 million bushels larger than the October forecast and 1.113 billion larger than the drought reduced harvest of 2009. The largest increase is expected in Argentina. The strengthening of the El Nino weather pattern bodes well for South American growing season weather in spite of some early season dryness in parts of Argentina.

The USDA increased the forecast of 2009-10 marketing year soybean exports by 20 million bushels and the forecast of the domestic crush by 5 million bushels. The larger export forecast reflects expectations of larger imports by China and the European Union, offsetting larger South American exports. The larger crush forecast reflects expectations of a slightly lower yield of soybean meal per bushel of soybeans. The forecasts of soybean oil and meal consumption were not increased.

Year ending stocks of soybeans are now projected at 270 million bushels, 40 million larger than the October forecast. However, the marketing year average farm price is expected to be between $8.20 and $10.20, $.20 above the October forecast.

For corn, the 2009 US average yield is now forecast at 162.9 bushels, 1.3 bushels below the October forecast. State average yield forecasts were lowered by 5 bushels in Illinois, Iowa, and Mississippi. Yield forecasts were increased for Colorado, Kentucky, Minnesota, Tennessee, and Washington. The US average yield forecast is two bushels less than the average of forecasts based on our crop weather and crop condition models.

The USDA reduced the forecast of 2010 corn acreage, yield, and production for Brazil. Production there is now forecast at 2 billion bushels, 39 million below the October forecast, but equal to the 2009 harvest. Conversely, the forecast of the South African harvest was increased by 39 million bushels. That crop is forecast at 453 million bushels, 49 million less than the previous harvest.

The forecast of 2009-10 marketing year US corn exports was reduced by 50 million bushels, to a total of 2.1 billion bushels. This is the second consecutive month for a lower forecast and reflects the slowing pace of export sales and increased competition from feed wheat. Year ending stocks of US corn are forecast at 1.625 billion bushels, 47 million below the October forecast. The 2009-10 marketing year average farm price of corn is forecast in a range of $3.25 to $3.85, $.20 above the October forecast.

The 2009 US wheat harvest is now forecast at 2.216 billion bushels, just 4 million below the previous forecast resulting from a slightly smaller estimate of the spring wheat harvest. The projection of 2009-10 marketing year exports were dropped 25 million bushels, reflecting prospects for increased competition from larger wheat supplies in Russia, Kazakhstan, and the Ukraine. Year ending stocks are projected at 885 million bushels, 21 million larger than the October projection and 228 million larger than stocks at the start of the year.

The USDA will release final estimates of the size of the 2009 US corn and soybean crops in the second week of January 2010. Price patterns will now reflect the pace of harvest, which has accelerated rapidly over the past 10 days, the progress of South American crops, and perceptions about the strength of demand. The declining value of the US dollar, higher crude oil prices, and advances in the stock market have been encouraging for demand prospects. Still, soybean prices appear to be a bit over valued in light of the large South American crop prospects. Particularly puzzling is the movement from an inverse to a small carry in the futures price structure given prospects for large supplies next spring.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 19, 2009, 10:43:58 AM
Weekly Outlook: Crop Prices Remain Firm
US - Corn and soybean prices continue to trade in a relatively wide range, but are currently near the highs of the past 10 weeks. Basis levels have weakened some as harvest accelerated, writes Darrel Good, agricultural economist at the University of Illinois.



The average cash price of corn in central Illinois peaked at $3.83 on 22 October, declined to $3.41 on 6 November, and stood at $3.62 on 13 November. That price had dipped under $3.00 in early September. The average cash price in central Illinois was $.28 under December futures on 13 November, compared to about $.15 under four weeks earlier. Corn prices have been supported by ongoing harvest delays as well as expectations that demand for corn-based ethanol will remain strong in the months ahead. Ethanol prices have moved sharply higher since late September, supported by very favorable blending margins. Reduced imports of Brazilian ethanol and some exports of US ethanol have contributed to those margins. The EPA ruling on increasing the limit on blending from 10 per cent to up to 15 per cent will be important for determining domestic market size moving forward. It appears that the self-imposed deadline of 1 December 2009 for making that decision will not be met.

The level of corn export sales in recent weeks has been disappointing. Sales averaged only 16.3 million bushels per week for the four weeks ended 5 November. Sales need to average well over 30 million per week in order to meet the current marketing year export forecast of 2.1 billion bushels. Weekly export inspections averaged 26.5 million bushels per week during the five weeks ended 12 November. Shipments now need to average nearly 42 million bushels per week through August 2009 in order to reach the current USDA projection.

The jury is still out on the likely level of feed and residual use of corn this year. Some analysts believe that the generally poorer quality crop will result in higher rates of corn feeding, while others believe the poorer quality will lead to higher levels of feeding of other ingredients, particularly soybean meal. Initially, the large supply of low priced corn screenings might result in at least a normal rate of corn feeding per animal. It is still almost two months before the 1 December corn stocks estimate will be available. That estimate will allow a calculation of feed and residual use of corn during the first quarter of the 2009-10 marketing year.

The average cash price of soybeans in central Illinois dropped below $9.00 in early October, peaked at $9.96 on 21 October, and stood at $9.635 on 13 November. The average cash price on 13 November was $.29 under March 2010 futures, compared to about $.11 under three weeks ago. Soybean prices have been supported by a rapid pace of exports and export sales. Through 5 November, export commitments (exports plus outstanding sales) stood at 68.5 per cent of the total exports projected for the marketing year. For the four weeks ended November 5, new sales averaged about 31 million per week. To reach the USDA projection, new sales now need to average about 10 million per week. For the five weeks ended 12 November, USDA export inspections averaged 55.8 million bushels per week. Shipments need to average about 23 million per week for the rest of the year to reach the USDA projection. The Census Bureau estimate of September 2009 exports was about 5 million bushels above the USDA estimate, indicating that USDA estimates may lag Census Bureau numbers this year, as has been the case in recent years. Export demand for US soybeans will be concentrated in the first half of the marketing year and is expected to drop sharply with the availability of the South American harvest.

The domestic soybean crush was extremely small in September, but the National Oilseed Processors Association estimates showed a sharp rebound in October. The October 2008 crush estimate exceeded that of a year ago. Part of the increase in crush reflects a lower yield of both oil and meal from this year’s soybean crop. In addition, the larger crush resulted in a sharp increase in soybean oil stocks. If confirmed by the Census Bureau crush estimate, the October crush figure suggests that the 2009-10 marketing year crush could exceed the current USDA forecast. At this juncture, however, the larger crush seems to reflect lower product yield more than an increase in consumption.

Prices of corn and soybeans have also been supported by a low valued US dollar and strength in the financial markets. A low valued US dollar may result in importers being able to pay a higher price for US commodities, but there is no historical statistical relationship between the value of the US dollar and the volume of marketing year exports.

Corn and soybean prices may be well supported in the near term by another round of harvest delays. Strong demand for corn for ethanol may also provide longer term support. At some point, however, the soybean market may suffer from a very large South American harvest.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 02, 2009, 01:11:52 PM
Tuesday, December 01, 2009Print This Page
Weekly Outlook: More to Corn, Soybean Demand?
US - The recent strength in crop prices has been lead by soybeans, writes Darrel Good, agricultural economist at the University of Illinois.



The rapid pace of exports and export sales has been the primary factor supporting soybean prices, but a number of factors are influencing both corn and soybean prices.

As of 26 November 2009, the USDA reported that 473 million bushels of soybeans had been inspected for export, 118 million more than the total of a year earlier. As of November 19, 579 million bushels of soybeans had been sold for export, but not yet shipped. Outstanding sales on the same date last year totaled only 328 million bushels. The year-over-year increase in export commitments reflects much larger purchases by China. Total export commitments to China as of November 19 stood at about 614 million bushels, compared to 328 million on the same date last year. A slightly smaller soybean harvest in China this year, a much smaller soybean harvest in South America, and a policy of increasing inventories in China account for much of the year-over-year increase in Chinese demand for US soybeans. The pace of Chinese purchases of US soybeans is expected to remain strong over the next several weeks.

The domestic soybean crush in September 2009 was the smallest for that month since 1997, reflecting the small inventory of old crop soybeans and the late harvest of the 2009 crop. For October 2009, the Census Bureau reported a record large crush for the month, exceeding the previous record of 2006 by about 1.3 million bushels. Cumulative crush for the first two months of the 2009-10 marketing year is estimated at 276.4 million bushels, 600,000 bushels (0.2 per cent) above the total of a year ago. The USDA has projected the 2009-10 marketing year crush at 1.695 billion bushels, 33 million (2.0 per cent) larger than the crush of last year.

The apparent disappearance of soybean meal (domestic plus exports) during October totaled 3.637 million tons, 182,000 tons more than in October 2008. The larger disappearance this year may reflect some rebuilding of inventories at locations other than processing plants. The November figure will provide a clearer picture of the actual consumption pace. Apparent soybean oil consumption during October 2009 totaled a record 1.854 billion pounds, 44.5 million pounds more than during October 2008.

For corn, the sharp increase in ethanol prices since late September, along with the extremely late harvest, has provided support for prices. The average price of ethanol at Iowa plants, as reported by the USDA Market News, was $2.05 per gallon on 27 November, compared to $1.51 on September11, 2009. The higher prices reflect favorable blending economics and have resulted in strong demand for corn by ethanol producers.

The pace of corn export sales and export inspections has generally been disappointing for much of the first quarter of the 2009-10 marketing year. The USDA has lowered the projection of marketing year exports by 100 million bushels since September. New sales need to exceed 32 million bushels per week to reach the current USDA export projection of 2.1 billion bushels. For the seven weeks ended November 12, new sales averaged less than 18 million bushels per week. However, new sales jumped to 48 million bushels during the week ended November 19 on the strength of large sales to Japan and Mexico. Japan is the largest and most consistent importer of US corn, but the pace of sales to Japan has been slow so far this year. As Japan “catches up” on purchases, the US sales pace should continue to improve.

While the late, slow harvest and a solid rate of consumption explain much of the recent strength in corn and soybean prices, those factors do not appear to explain all of the strength. The market is well aware, for example, that the pace of US soybean exports and export sales will slow dramatically by the spring of 2010. The seasonal decline may be much sharper than normal due to prospects for record South American production. The lack of profitability in the domestic production of livestock and livestock products and the sharp increase in availability of distillers grains points to weak feed demand for corn and soybean meal. In addition, corn and soybean acreage in the US will likely increase in 2010 as a result of fewer acres of wheat and expired Conservation Reserve Program contracts. The large carry in the corn futures market (8.5 per cent from December 2009 to July 2010) and a positive carry in the soybean market in the face of a record South American crop in 2010, suggest the markets are anticipating a sizeable increase in the rate of inflation in 2010. Historically, the rate of inflation has not provided prolonged support for crop prices. Those prices must eventually reflect production, consumption, and inventories of the individual crops.


 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 08, 2009, 12:11:20 PM
 US trade team seeks to reclaim hold in Philippine market
[8 December 2009] An 11-man team from the US is in the Philippines to try to regain its market in the Philippines for soybean meal. The group, composed of soybean farmers, state soybean board officials, shipping agents and traders arrived late last week to encourage local feedmillers, poultry and hog farmers to shift to US soybean meal (SBM) again. The US had previously dominated the Philippine market, supplying about 65% of the country's 1.5 million tonnes of SBM imports, but gradually lost its hold to cheaper SMB from Argentina. In 2009, the US accounted for only 26% (291,676 tonnes) of the Philippines SBM imports, while Argentina supplied about 771,137 tonnes (69%). Other sources of SBM for the Philippines are India and Brazil. 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 03, 2010, 10:37:59 AM
Philippine feed wheat imports to reach 700,000 tonnes
[2 March 2010] The Philippines is expected to bring in some 700,000 tonnes of feed wheat imports for the first half of the year to offset any possible shortage in corn supply, said Agriculture Assistant Secretary Salvador Salacup. He said that 300,000 tonnes have already been brought in by feedmillers and livestock and poultry producers who are anticipating the adverse effects of the current drought on corn production. Some industry players think the amount of imported feed wheat might be even be greater if there is a shortage in corn production which will likely pull the price of yellow corn up. Earlier this year, some traders said that despite the 7% duty on feed wheat, landed cost of the grains remains on par with the price of yellow corn. For now, local corn industry players are mum on the imports, with some saying that the amount is so far acceptable as this will simply fill any possible shortage.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 03, 2010, 10:39:12 AM
Areas planted to BT corn expand
[3 March 2010] Areas planted to the genetically modified (GM) BT corn in the Philippines expanded by some 14% to 400,000 hectares in 2009, a report by the International Service for the Acquisition of Agribiotech Applications (ISAAA) said. The group said the developing countries continued to increase their share of global biotech crop to almost 50% last year, with the Philippines being one of the top five countries exhibiting a growth in biotech crop area of at least 10%. The cultivation of GM crops have come under fire from various environment and food safety groups who question the safety of these products. Nevertheless, more and more GM crops are being produced globally, most especially in developing countries, where the biotech crop area last grew by 13% or seven million hectares as compared to industrialised nations where the growth was at 3% or two million hectares.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 06, 2010, 01:52:35 PM
Areas planted to BT corn expand
[3 March 2010] Areas planted to the genetically modified (GM) BT corn in the Philippines expanded by some 14% to 400,000 hectares in 2009, a report by the International Service for the Acquisition of Agribiotech Applications (ISAAA) said. The group said the developing countries continued to increase their share of global biotech crop to almost 50% last year, with the Philippines being one of the top five countries exhibiting a growth in biotech crop area of at least 10%. The cultivation of GM crops have come under fire from various environment and food safety groups who question the safety of these products. Nevertheless, more and more GM crops are being produced globally, most especially in developing countries, where the biotech crop area last grew by 13% or seven million hectares as compared to industrialised nations where the growth was at 3% or two million hectares.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 10, 2010, 10:58:10 AM
Weekly Outlook: Value of US Dollar and Corn Prices
US - It has not been uncommon for daily fluctuations in corn prices to be attributed to fluctuations in the value of the U.S. dollar relative to other currencies. So, what is the connection?, asks Darrel Good, agricultural economist at the University of Illinois.



From the side of the importer of US corn, a lower valued dollar in relation to the currency of that country, all else equal, is in effect a reduction in the price of corn. A lower price to the importer might be expected to result in larger imports. That is, there would be a movement down the demand curve to a new, larger equilibrium of quantity supplied and quantity demanded. For the US market, larger exports at the same nominal price of corn is in effect an increase in demand. That is, there is an upward shift in the demand curve for US corn. In turn, the increase in demand results in a higher equilibrium price of corn. Theoretically, then, a lower valued US dollar should result in larger exports and a higher nominal price in the US, assuming no change in other price factors.

The relationship between the value of the US dollar and the volume of US corn exports during the 12 month marketing year is difficult to identify. For the 10 marketing years from 1999-2000 through 2008-2009, for example, we find a very low correlation between the two variables. However, that is not the proper relationship to examine because it violates the assumption of all other things equal. A proper analysis should try to isolate the impact of the value of the dollar from the impact of other factors.

One of the things revealed in historic corn export data is that exports to the largest importer, Japan, are remarkably constant from year to year. For the period 1999-00 through 2008-09, Japan accounted for 26 to 36 per cent of annual US corn exports. Japan's imports of US corn were in a narrow range of 567 to 628 million bushels. It is generally well known that Japan buys US corn based on the need to support the domestic livestock industry and that imports are not sensitive to price or exchange rates. The data over the 10 year period supports that observation.

Examining the relationship between exports of US corn to destinations other than Japan and the value of the dollar reveals a negative correlation of about 0.4. The direction of the relationship is as expected and is relatively strong, but that simple relationship ignores the impact of other factors that might influence exports of US corn. Those factors might include such things as the price of corn and the magnitude of grain production outside the US Adding those factors to the analysis fails to yield a strong relationship between exports and the value of the US dollar.

The analysis presented here of the relationship between corn exports and the value of the dollar is not comprehensive and covers a very short period of time. Still, the results suggest that exports of US corn in any given year may not be especially sensitive to the value of the US dollar. In fact, the magnitude of corn exports in a given year does not appear to be highly correlated to other factors such as foreign grain production. The inability to quantify these relationships makes it difficult to forecast corn exports.

A second point about the effect of the value of the dollar on corn prices is that the export market is now a relatively small portion of the US corn market. Exports this year, for example, are expected to account for only 15 per cent of the total consumption of US corn. Exports to destinations other than Japan may account for only 10 to 11 per cent of total consumption. Even if the influence of the dollar's value on exports is stronger than suggested here, the impact on the price of corn is likely relatively small.

It appears that the impact of the value of the US dollar on the value of corn may be less than implied by daily market commentary. The direct cause and effect relationship is relatively weak. There may be some recent economic relationship between the value of the US dollar and crude oil prices which impacts the value of ethanol and therefore corn. The value of the US dollar and commodity prices may also be correlated to some degree in the current economic environment as expectations about world economies influence both the value of the dollar and decisions about investment in commodities in general. In any case, it is unlikely that the corn market will completely ignore currency values in the price discovery process, even if the relationship is weak.


 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 12, 2010, 10:16:13 AM
PSA: Poor Harvest Year May Have Altered Corn Quality
US - Last year produced a bumper corn crop, but wet conditions during part of the growing season and harvest may have impacted its overall nutritional value, according to the Poultry Science Association (PSA).



In addition, nutritionists who rely on bushel weight as a prime factor for assessing quality may be missing an important part of the quality-evaluation picture, said PSA.

"Adverse growing conditions and the potential for reduced bushel weight are one component of the corn quality equation. Unfortunately, determining a precise relationship between variability in bushel weight and the nutritional value of corn is problematic," said Dr Mike Lilburn, a poultry nutritionist in The Ohio State University's Department of Animal Sciences.

In a given harvest year, the presence of poor growing conditions is often reflected in variations in the bushel weight or test weight of corn. A common measure used for pricing purposes, bushel weight represents a composite of factors affecting bulk density and assumed quality of the grain. The standard bushel weight for No. 2 Yellow corn is 56 pounds per bushel, but for years like 2009, with significant variability in the growing season, much of the corn coming out of the field may be well below this industry standard. Drying the corn, a process which takes place after harvest, can increase bushel weight, but the drying process may have other effects on the overall feeding value of the crop.

According to Dr Lilburn, nutritionists have long been aware of the variability in commodity grains and use routine analytical testing (moisture, fat, protein, etc.) to adjust their nutrient matrix values accordingly. These analytical tests, however, do not reflect what nutritional value the animal actually derives from a particular ingredient. This is particularly the case, says Dr Lilburn, for the energy content of grains, like corn.

Impact of Drying Temperatures
Corn harvested with above average moisture content may require more extensive drying prior to storage. According to Dr Lilburn, the drying conditions, particularly the drying temperature, may contribute to quality issues.

Dr Lilburn cited a 1975 study (Peplinski et al, Cereal Foods World) showing that widely different drying temperatures had little impact on the chemical composition of corn samples but did have considerable impact on many of the physical characteristics of interest to corn end users, such as bushel weight, kernel damage, kernel breakage, stress crack formation, etc. The study concluded that optimal harvest moisture should be ≤ 25 per cent with drying temperatures less than 180 F (82°) to minimize this type of physical damage to the grain.

High drying temperatures may also cause nutritional damage to corn. Peplinski et al. (1994) took corn samples from 30 per cent to 12 per cent moisture using temperatures ranging from 25° to 100°C. At the lower temperature, the drying took 38 hours while at 100°C, it only took one hour. Dr Lilburn cited a 2009 study by Malumba et al. (J. Food Engineering) which reported that the extractability of individual proteins from corn was greatly reduced for corn dried at 80°C and higher, indicating a potential decline in the nutritional value of the grain even though its gross chemical composition remained unchanged.

"Buyers should be on the lookout for corn coming in with moisture levels lower than they typically see, as this may be an indication that corn was dried down quickly at higher than normal temperatures," said Dr Lilburn.

The possible need of the corn producer to quickly dry his or her crop will be controlled by yield and weather conditions at harvest, but there may be an inherent tradeoff with the final quality of the grain. Drying conditions are something that buyers should be aware of and take into account whenever possible.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on March 17, 2010, 10:09:44 AM
Weekly Outlook: Month-end USDA Reports
US - The USDA will release two reports on 31 March that could have significance for corn and soybean prices, writes Darrel Good, agricultural economist at the University of Illinois.



These are the 1 March Grain Stocks report and the annual Prospective Plantings report.

The quarterly stocks report for corn may be more important this year than in a typical year. There are still unresolved questions about the size of the 2009 harvest and the impact that quality of the 2009 crop has had on domestic consumption. Some argue that the generally low test weight of the 2009 crop has resulted in higher consumption rates in both the livestock and processing sectors. Lower test weights should result in larger rates of consumption if consumption were measured by volume. However, production and consumption estimates are made in units of weight so that the impact of test weight on the number of bushels consumed may be minimal. The stocks report may shed some light on this issue.

Anticipating the estimate of 1 March inventories of corn is also complicated by the seasonal pattern of domestic feed and residual use of corn during the past two marketing years. For the five years from 2002-03 through 2006-07, feed and residual use of corn during the first half of the marketing year ranged from 61.6 to 66.3 per cent of the marketing year total. The average was 63.8 per cent. First half use was 70.2 per cent of the marketing year total in 2007-08 and 68.1 per cent in 2008-09. What is the pattern this year? Assuming the pattern is the same as last year and that the USDA projection of 5.55 billion bushels for the year is correct, use during the second quarter should have been near 1.69 billion bushels. In contrast, a reversion to the 2002-03 through 2006-07 pattern would result in second quarter use of only 1.45 billion bushels, a difference of 240 million bushels.

If the seasonal pattern of domestic corn processing is following that of last year and the USDA projection of 5.565 billion bushels for the year is correct, use during the second quarter of the year should have been near 1.332 billion bushels. The combination of USDA and Census Bureau export estimates to date suggest that second quarter exports were near 422 million bushels. Using the higher estimate of feed and residual use, total use during the quarter should have been near 3.444 billion bushels. In that case, 1 March stocks would have been near 7.475 billion bushels, 520 million larger than the inventory a year earlier.

For soybeans, exports during the second quarter of the 2009-10 marketing year were likely near 618 million bushels. The Census Bureau has estimated the domestic crush for December 2009 and January 2010. Based on a guess of the February crush, the total for the quarter was near 485 million bushels. Seed, feed, and residual use of soybeans is the smallest category of use, but the quarterly pattern is somewhat unpredictable. For the five years from 2004-5 through 2008-09, use in that category during the first half of the year ranged from 124.4 to 193.1 million bushels. The average was 164 million. Use during the first quarter of the 2009-10 marketing year was estimated at 186.4 million bushels. Unless the 2009 crop was overestimated, use during the second quarter should have been small. If use was near 20 million bushels, total consumption of soybeans during the quarter is estimated at 1.123 billion bushels. Stocks on 1 March, then, should have been near 1.217 billion bushels, about 85 million less than stocks of a year ago.

A lot has been written about planting intentions of various spring planted crops in 2010. Expectations for corn and soybean acreage intentions are in a wide range. There is more uncertainty than usual about prospective plantings of spring crops because of the large decline in winter wheat seedings, the maturity of some CRP contracts, the wide range in total planted acres of all crops in recent years, and the lack of fall field work and fertilizer application in some areas. There seems to be general agreement that producers will report intentions to plant more corn due to expanding ethanol requirements. Expectations generally fall in a range of a two to four million acre increase. Expectations for soybean acreage are more diverse, with some expecting intentions to show an increase and some expecting a decrease. A large increase would likely be viewed as negative for prices due to the large South American crop and prospects for declining demand for US soybeans.


 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on April 03, 2010, 08:40:18 AM
, April 01, 2010Print This Page
Higher Corn, Soybean Acreage Means Lower Prices
INDIANA, US - American agriculture's brief wheat revival appears to be over. Farmers in 2010 are expected to practice the old-fashioned religion of corn and soybeans, said a Purdue University agricultural economist.

Purdue News
 

Chris Hurt said Wednesday's (31 March) US Department of Agriculture Prospective Plantings Report portends larger stocks of corn and soybeans. He expects prices for the two commodities to fall, leaving farmers with tighter profit margins.

"There really is nothing in this report that would make us more bullish in terms of corn and soybeans," Professor Hurt said. "This has a tone that would suggest weaker prices until we can perhaps see lower prices begin to stimulate usage in the United States and around the world.

"That stimulation of usage would take some time. We'd have to rebuild livestock numbers. Most of the livestock industry is just beginning to get back to making some money, and it is going to be very hesitant to expand."

How low could corn and soybean prices go?

"Corn could well be in the lower $3 per bushel range," Professor Hurt said. "Soybeans certainly could drop back below the $9 per bushel mark, as we think about new crop beans especially. This begins to squeeze - given relatively high production costs - the margins for producers.

"We're reverting now a little bit back to the norm in US agriculture. And the norm in US agriculture has been we have more ability to produce than we have the ability to consume."

The USDA report, issued annually and based on farmer surveys, projected a 3 per cent increase in corn acreage and a slight increase in soybean planted acreage from 2009 across the United States this spring.

Farmers told the USDA they expect to plant 88.8 million acres of corn. National soybean acreage is projected at just over 78 million acres, a less than 1 per cent increase from this past year, but an all-time US high. In comparison, US farmers intend to produce 5.3 million fewer acres of wheat.

Indiana farmers say they intend to plant 5.7 million acres of corn and 5.5 million acres of soybeans this spring, up 100,000 acres and 50,000 acres, respectively. Farmers in Illinois expect to plant 12.6 million acres of corn (up 600,000 acres) and 9.5 million acres of soybeans (up 100,000 acres), while Ohio growers intend to plant 3.7 million acres of corn (up 350,000 acres) and 4.6 million acres of soybeans (up 50,000 acres).

Those additional corn and soybean acres are coming mostly from wheat, Professor Hurt said.

"The big decline in wheat acreage is really coming from the fall-seeded crops," he said. "Two things are going on there. One was very low returns and poor prices for wheat prospects and, secondly, extremely wet weather for the harvest season in 2009. We just didn't get the wheat in the ground.

"In Indiana we saw wheat acreage at the lowest level in recorded history - just 300,000 acres. That gave rise, then, to the ability to plant more corn and soybeans. We see a very similar pattern in neighboring states."

Just two years ago, wheat acreage was on the rise. Indiana farmers that year planted around 600,000 acres.

If the USDA report is accurate, farmers should return to average income levels, Professor Hurt said.

"If we go back and look at the last five years, we really see two good crop years in terms of income - 2007 and 2008. The 2009 crop ended up being a very high-cost crop, and most producers didn't really have strong recovery in terms of their costs. And now 2010 shapes up kind of the same way. We are going to see, maybe not a struggle, but tight margins. This is what most producers in agriculture in Indiana and around the country face most years."

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 11, 2010, 12:41:42 PM
Corn progress remains ahead of schedule
[10 May 2010] At the end of last week, US corn planting was 68% complete, compared to the 2005–2009 average of 40% as the weather has been better for planting this year than last. Corn emergence is also ahead of pace at 19%, compared with the 2005–2009 average of 9%. If the overall progress of the corn crop stays ahead of the past two years, when weather disruptions slowed progress significantly, the corn harvest and the resulting transportation demand could be 2–4 weeks earlier than in 2008 or 2009.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 15, 2010, 10:03:58 AM
US predicts healthy corn crop 
[14 May 2010] The US corn crop this year could reach a record 13.37 billion bushel said the USDA. This will set a record corn supply of 15.118 billion bushels in the 2010/11 (September-August) marketing year — more than enough to cater to rising exports and ethanol use, with end stocks of 1.818 billion bushels, up 5% from last year. USDA predicted corn exports in 2010/11 at 2 billion bushels, compared to 1.95 billion bushels expected in 2009/10, which it raised on larger supplies and lower prices. Corn prices were seen down to a range of USD 3.20-3.80 per bushel in 2010/11 from a tighter range of USD 3.50-3.70 in 2009/10.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 24, 2010, 10:15:10 AM
Monsanto offers new GM corn varieties
[24 May 2010] Agricultural biotechnology firm Monsanto has applied with the Philippine government for approval to introduce its second generation Bt corn and Roundup ready corn. Dr Harvey Glick, Senior Director of Scientific Affairs for Asia said that field tests have already started in the company’s site in South Cotabato. He said Monsanto is also developing a “drought tolerant corn” variety, which they hope to be approved for use in the US in 2012. Last year, the Philippines targeted to plant 480,000 hectares of land for Bt corn, however, because of last year’s storm and the ongoing drought in the country, this is unlikely to be met. According to the Bureau of Agricultural Statistics, total corn production in the country actually contracted by 16.8% to only 1.6 million tonnes during the first three months of the 2010 compared to the same period last year.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 26, 2010, 11:22:48 AM
CME: 2010 Corn Planting Substantially Complete
US - USDA’s weekly Crop Progress report indicates that 2010 corn planting is substantially complete as of Saturday with 93 per cent of intended acres planted, write Steve Meyer and Len Steiner.

That figure rivals the 2005 planting clip as of this week (95 per cent) for the fastest ever but the bulk of this year’s acres were planted earlier than those of 2005, driving high expectations for 2010 yields. As can be seen, this year’s pace is FAR AHEAD of 2009 when just over 60 per cent of corn acres had been planted by this date. While yields were record-large last year, late planting and cool summer weather negatively impacted the quality of last year’s corn crop and the performance of livestock this crop year.


Though corn planting was the fastest ever this year, corn emergence is still lagging the best-ever pace of 2000. As of May 23, 71 per cent of corn had emerged. That compares with 30 per cent last year, a computed 5-year average of 51 per cent and USDA’s published 5-year average of 62 per cent. The linear increases of 16 per cent per week over the past two weeks underscore the impact of cool, overcast, generally rainy weather in many major corn growing regions. The recent weather pattern has kept corn crop condition ratings near historical levels in spite of the record planting pace. 71 per cent of corn acres were rated good or excellent this week, up from 67 per cent last week. There was no rating for corn in last year’s concurrent week. This week’s 71 per cent good-excellent tied for fourth in the historical data with 1994’s 78 per cent being the highest on record.


Soybean planting is progressing at a far slower pace due to continuing wet weather in many areas. Only 15 per cent of total acres were planted last week, bringing the season-to-date total to 53 per cent. That compares to 48 per cent for the same week last year and a computed average of 66 per cent over the past 5 years. 24 per cent of soybeans had emerged as of Saturday. That number is sharply higher than last year’s 14 per cent but lower than the computed 5-year average of 27.2 per cent.

It is safe to say that the 2010 crop is progressing well at this point. Slower-than-average soybean planting poses little problem — at this point in time.

DLR readers are reminded of CME Group’s webinar regarding dried distillers’ grains (DDGs) coming up Wednesday, May 26 at 2:00 p.m. CDT. Readers can attend the session in-person at the Visito Center Auditorium at 141 W. Jackson St. or tune in on the internet by registering at www.cmegroup. com/ ddgwebinar. DLR author Dr Steve Meyer will be joined by Dr Darrell Mark of the University of Nebrasks to discuss the production, characteristics and uses of DDGs as well as the performance and costs impacts they have on livestock production.

For those who may not be familiar with DDGs — they are a primary co-product of ethanol production. Each bushel of corn that is fermented produces roughly 2.8 gallons of ethanol, 17 pounds of DDGs and 17-19 pounds of CO2. The trade of 56 pounds of corn for 17 pounds of DDGs is not necessarily a good one for the livestock and poultry sectors but that 17 pounds of usable feed ingredients has helped reduce diet costs from where they would have been had DDGs not been available. Since ethanol production converts the starch in corn into ethanol and CO2, DDGs are high in protein, fiber, fat and minerals. They still have a relatively high dietary energy content but that energy comes from fat instead of starch. Cattle and other ruminants can use the fiber and low-quality protein very efficiently. They can be added to hog and poultry rations but their relatively low-quality protein limits their usefulness to some degree. Tune in to learn more.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on May 31, 2010, 10:45:08 AM
Philippine corn output down 16.8%
[31 May 2010] Philippine corn production suffered a setback in the first quarter of 2010. Corn output from January- March only reached 1.6 million tonnes, down 16.76% from 1.9 million tonnes during the same period in 2009. The contraction is blamed on the hot weather that has been plaguing the country, with production areas in major corn producing regions like Cagayan Valley, SOCCSKSARGEN, Western Visayas, Northern Mindanao and CAR contracting during the first three months. Valuewise, the sector also posted a decline with gross receipts only reaching PHP 18.6 billion (USD 399.62 million), down 28.52% from last year’s PHP 26.02 billion (USD 559.07 million), as average farm prices also dropped to PHP 11.61/kg (USD 0.25) from PHP 13.52/kg (USD 0.29). The drop in prices has been attributed to the weak demand by processors for white corn, as well as the low quality of grains and availability of imported feed substitutes for yellow corn.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 03, 2010, 08:40:32 AM
Philippines import corn to fill local shortage 27 May 2010
Philippine feed millers imported 80, 000 tonnes of corn from Thailand to fill in the shortage caused by the El Nino, the Philippine Feed Millers Association Inc. said.
Related
The corn shipment arrived between the months of January to May at a price of $250 per ton.
 
Feed millers have also contracted 844,000 tonnes of feed wheat, a substitute for corn. A total of 500,000 tonnes of it have already arrived in the Philippines. The remaining volume is expected to arrive in the country in or before October.
 
Local corn production declined 16.8% to 1.8 million tonnes in the first quarter because of the El Nino, according to the Bureau of Agricultural Statistics (BAS).
 
BAS expects that, with the El Nino expected to last until June, corn production will decline further. For the period of January to September, BAS forecasts corn production to fall 17% to 4.6 million tonnes.
 
The Department of Agriculture said the dry spell has damaged around 500,000 tonnes of corn.
 
Feed millers face bad year
Feed millers are no longer keen on importing corn despite a drop in domestic output, because of weak demand from animal feed suppliers.
 
“The industry is not keen on bringing in more corn. We’re done importing [for 2010]," said an official of the Philippine Association of Feed Millers Inc.
 
The demand by pig and poultry feed suppliers has weakened, forcing many feed millers to pare production and plug their losses, the association official said.
 
Animal feed production is expected to decline by 10% to 4.9 million MT this year.
 
The association has booked up to 800,000 MT of feed wheat — a cheaper corn substitute — for delivery toward September 2010 to cover for the slack in imported corn. The landed cost of feed wheat is lower than that of corn.
 
This might be the most difficult year for feed millers, “probably because of the climate change factor. Animals are getting stressed. Raisers have started cutting down on volume," he said.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 08, 2010, 06:24:36 AM
Higher corn output likely to ease Chinese price hike
[7 June 2010] China produced 163.97 million tonnes of corn in 2009, down 1.17%, according to data from the National Bureau of Statistics cited by the China National Grain and Oils Information Center (CNGOIC).  The figure was in line with CNGOIC's own estimate but higher than the expectation by some independent institutions due to drought. Many traders have ignored the CNGOIC estimate saying it may have been encouraged by overly-optimistic forecasts from local government officials. Expectations of a scant supply coupled with a recovery of demand from feed and corn processing industries, have pushed up China’s corn prices in some areas to a record level and prompted large imports from the US. Prof Cheng Guoqiang, a researcher with the State Council's Development Research Center pointed out that the price rise was partly due to the country’s reserves and poor logistics for transporting corn from the major growing areas in the northeast.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on June 18, 2010, 10:15:15 AM
SMC takes over grains terminal
[17 June 2010] San Miguel Corporation (SMC) is taking over the operations of the Mariveles Grain Terminal, the most modern grain handling facility in the Philippines, after it acquired Mariveles Grain Corporation (MGC) from Asian Terminals Inc (ATI). MGC holds a permit to operate the Mariveles Grain Terminal until February 2033. It offers unloading, conveying, storage, outloading, weighing, bagging and sampling services and handles bulk cargo of commodities like wheat, soybean meal, corn and soybeans. The terminal can accommodate vessels of up to 70,000 deadweight tonnes, discharge cargo of up to 10,000 tonnes daily and store 180,000 tonnes of soybean meal and grain. SMC has been keen on acquiring MGC as this would help the company become a distribution and logistics powerhouse, as well as help SMC to expand the 500,000 tonnes annual capacity of its feed mill located near the grains terminal.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 03, 2010, 10:34:36 AM
Smaller Planted Corn Acreage Surprises Trade
US - The Agriculture Department yesterday released the 2010 Acreage report, and the numbers point to less corn acres than markets had expected.



The new number should be favorable to the corn market, according to John Anderson, an economist with the American Farm Bureau Federation.

“Today’s acreage report is watched very closely by the trade because it is the first official estimate of actual planted acreage,” Dr Anderson said. “According to USDA’s National Agriculture Statistics Service (NASS), planted corn acreage is estimated at 87.9 million acres. This is much lower than anybody expected. Most in the trade were expecting more than 89 million corn acres. This is very supportive of the corn market.”

Planted soybean acreage, on the other hand, is generally on the high side of what many in the trade expected. NASS estimates 2010 soybean plantings at 78.9 million acres. This is a 1.4 million acres or 2 per cent increase from 2009, when soybean plantings totaled 77.45 million acres. Soybean planted acreage this year set a new record.

And while corn acreage is less than forecast, plantings are still near historic highs. Planted corn acreage in 2010 is up 1.4 million acres from last year. This marks the second consecutive increase in planted acreage to corn and the second highest acreage on record since 1946, only behind 2007.

Dr Anderson said good planting conditions for both corn and soybeans and generally favorable growing conditions point to favorable harvests.

“Crops look very good right now, and it is still possible that we could see record corn and soybean crops this year,” he said.

USDA also released its quarterly grains stocks report yesterday, showing corn stocks up 1 per cent from June 2009 and soybean stocks down 4 per cent. Corn stocks were lower than what the trade expected, which means more corn is being used than anticipated.

“Last year at harvest we had some problems with grain quality in corn. There has been quite a bit of discussion in the market about low test weight corn not going as far in livestock rations. For whatever reason, whether due to quality issues or just higher demand from the livestock and poultry sector, today’s corn stocks estimate suggests that feed use of corn has been larger than expected,” Dr Anderson said.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 06, 2010, 12:10:48 PM
More corn and soybean planted
[5 July 2010] The USDA's hal yearly report estimates that U.S. farmers planted 87.872 million acres of corn and a record 78.868 million acres of soybeans in 2010, both 2% higher than last year. Compared to 2009, the largest increases in planted corn acreage were in Illinois and Kansas. Record high soybean acreages are estimated in Kansas, Nebraska, New York, and Pennsylvania and tie with the previous record highs in Minnesota and Oklahoma. Wheat acreage is estimated to be 54.3 million acres, down 8% from 2009. If the acres planted and trend yields are realized, the fall soybean and corn harvest may reach near-record levels, requiring more storage and/or transportation demand than normal.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 13, 2010, 11:28:42 AM
Lower corn exports from China
[13 July 2010] Data from China Customs' suggest that the country’s total corn exports in June was 9,421 tonnes, down 41.56% from the previous month; while total exports for the first six month this year was 80,391 tonnes, an increase of 35% year-on-year. Meanwhile, China started to import more corn in April, with a large volume imported by Liuhe Group in June. A USDA report said that corn production in 2009/10 is estimated to drop 9% from the previous year to 150 million tonnes although government agencies reported a bumper harvest for the sixth consecutive year. Previous field observations in most of the major corn producing provinces in the northeast and the North China Plain revealed that corn yields were substantially impacted by adverse weather patterns.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 14, 2010, 05:56:52 AM
Expectations Change on Supply and Consumption
US - Changing supply and consumption expectations were noted in the latest World Agricultural Supply and Demand Estimates report.



The USDA's July report of World Agricultural Supply and Demand Estimates contained a number of changes from the June report. Some of those changes were driven by information in the USDA's June 30 Acreage and Grain Stocks reports and some were driven by changing US and world production prospects.

For corn, the USDA lowered the projection of domestic stocks on 1 September 2010 by 125 million bushels, reflecting the smaller than expected 1 June inventory reported earlier. The change was accommodated by a 175 million bushel increase in the projection of feed and residual use and a 50 million bushel reduction in the projection of ethanol use of corn. For the 2010-11 marketing year, the projection of production was reduced by 125 million bushels, expectations for exports were reduced by 50 million bushels, and the projection of ending stocks was reduced by 200 million bushels. Those ending stocks are projected at a four year low of 1.373 billion bushels. That projection represents 10.3 per cent of projected use, the lowest in seven years. The projection of coarse grain production in Russia was reduced by 11 per cent from the June projection. World coarse grain production in 2010-11 is still expected to be record large. World stocks are expected to decline modestly during the year ahead and are projected at a three year low.

For wheat, the estimate of use during the 2009-10 marketing year that ended on 31 May was reduced by 44 million bushels to accommodate the larger-than-expected 1 June inventory estimate released on 30 June. About half of the reduction was in exports and half in the feed and residual category. For the 2010-11 marketing year, the forecast of domestic production was increased by 149 million bushels, reflecting a larger winter wheat forecast and the first forecast of spring wheat production. The 2010 wheat crop is now expected to equal the 2009 crop even though seeded acreage declined by 4.8 million acres. The large crop forecast reflects fewer unharvested acres than last year and a record US average yield of 45.9 bushels per acre.

The 2010-11 marketing year projection of US wheat exports was increased by 100 million bushels to a total of one billion bushels. That projection is 135 million above the last year's exports and reflects a large reduction in production prospects outside the US. Foreign wheat production in 2010-11 is projected at 22.074 billion bushels, 422 million smaller than the June projection and 690 million bushels smaller than last year's crop. Large year-over-year declines are expected in Canada (220 million), Russia (320 million) and Kazakhstan (110 million). The US share of the world export market is projected at 20.7 per cent, up from 18.3 per cent last year.

Year ending domestic stocks of wheat are projected at a 23-year high of 1.093 billion bushels. Only the stocks of soft red winter wheat are expected to decline. That decline reflects a 34 per cent year-over-year reduction in production. World wheat stocks are expected to decline modestly from the very large level of a year ago.

For soybeans, the projections of both the domestic crush and exports during the current marketing year were increased by five million bushels and the projection of year ending stocks was reduced by 10 million bushels, to a total of 175 million. The projection of 2010 production was increased by 35 million bushels, reflecting the larger acreage estimate released on 30 June. The projection of 2010-11 year ending stocks was unchanged at 360 million bushels as a result of a five million-bushel increase in the projection of crush and a 20 million-bushel increase in projected exports.

Changes for soybeans in the rest of the world were minor, with an 18 million bushel increase in the estimated size of the 2010 Argentine crop. Stocks in the rest of the world are expected to decline modestly during the upcoming marketing year, but to remain at very large levels.

From the lows on 29 June to the post-report highs, December 2010 corn futures increased by $0.55, November 2010 soybean futures increased by $0.51, and September 2010 wheat futures increased by $0.935. As of the close on 9 July, prices were off those highs, with the largest decline coming in wheat prices. Winter wheat producers likely benefited the most from the price rally since a large portion of the crop is typically sold in the immediate post-harvest period.

Taken together, the USDA reports appear to be most constructive for corn prices. The market will now anxiously anticipate the corn and soybean production forecasts to be released on 12 August. There are very mixed ideas about the effect of an extremely wet June and very mixed July weather conditions on the potential size of the crop.


Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 15, 2010, 10:00:45 AM
China’s grain output expected to fall slightly
[15 July 2010] An agricultural expert has warned of a "slight drop" in China's total grain output this year as a result of frequent natural disasters. Lu Bu, a researcher from the Institute of Agriculture Resources and Regional Planning at the Chinese Academy of Agricultural Sciences, said 1% to 2% of grain loss is foreseeable, adding that fortunately, the decrease will be minimal compared with the total grain yield of the country.  The flood-plagued six provinces are not major grain producing regions, he added. By June 20, a total of 1.3 million hectares of crops had been damaged by heavy rains in five provinces, including Zhejiang, Fujian, Jiangxi, Hunan, Guangdong and Guangxi, according to the Ministry of Agriculture.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 15, 2010, 10:01:56 AM
China buys nearly 1 million tonnes of US corn
[15 July 2010] As of July, China has purchased nearly 1 million tonnes of corn from the US since April, a record high for the same period since 1995. Liuhe Group, one of China’s largest feed producers has completed the customs procedures for some 115,000 tonnes of corn imported from the US, a source close to the deal told Asian Poultry Magazine. China has ample corn reserves after bumper harvests for several years running and is able to keep domestic corn prices under control, according to the Sate Administration of Grain. Chinese corn prices have reached new highs as a result of the severe drought in corn producing areas in China since 2009, said an industry analyst. Currently, the price of US No.2 yellow corn after tariff payment is around CNY 1,860 (USD274)per tonne, which is CNY 90-180/tonne lower than domestic ones.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 15, 2010, 10:30:32 AM
US Feed Outlook - July 2010
US feed grain production in 2010 is expected to be down from last month reflecting lower planted acreage as forecast in the June 30 Acreage report, according to the USDA Economic Research Service.

 

Feed grain production is projected up from 2009 as planted and harvested area are up from last year for corn, more than offsetting year-to-year reductions for sorghum, barley and oats. Adjustments are made in 2009/10 use this month to reflect 1 June stocks. The resulting changes lower 2009/10 ending stocks and 2010/11 supplies. Forecast 2010/11 prices for all four feed grains are raised this month, as feed grain ending stocks are projected lower. US corn exports for 2010/11 are decreased based on stronger US prices. Foreign coarse grain ending stocks for 2010/11 are down slightly more than US stocks, mostly due to reduced barley production prospects. During 2010/11, world coarse grain stocks are projected to decline five per cent.

 
Feed Grain Production Prospects Lowered
US feed grain production in 2010/11 is projected at 350.6 million metric tons, down 3.5 million tons from a month ago and up 1.6 million from 2009. The 30 June Acreage report showed planted acres decreased from earlier intentions for all four feed grains. The first survey-based production forecast for barley is down eight million bushels from the previous projection, which was based on trend yields and intended plantings. The lower barley production forecast reflects lower planted and harvested area, which is partially offset by an above-trend yield forecast. The first survey-based oats production forecast is down two million bushels from the June projection, reflecting lower harvested area but yields are expected to be higher than trend. USDA will make its first survey-based forecasts for corn and sorghum in the 12 August Crop Production report.

Feed grain supply in 2010/11 is projected at 394.6 million metric tons, down 7.2 million from last month and down 3.7 million tons from 2009/10. Feed grain imports are decreased 300,000 tons from last month and are down 200,000 tons from 2009/10. Beginning stocks in 2010/11 were lowered 3.4 million tons this month to 41.9 million because of higher use in 2009/10.

Projected total use of feed grains in 2010/11 is decreased 1.4 million tons this month, reflecting lower feed and residual use and exports. Ending stocks for 2010/11 are projected at 38.5 million tons, down 5.8 million tons from last month and down 3.4 million tons from 2009/10.

Feed and residual use of all feed grains in 2010/11 is expected to total 141.6 million metric tons and account for 39.8 per cent of total use. When converted to a September-August marketing year, feed and residual use for the four feed grains plus wheat is projected to total 147.57 million tons, down from the 2009/10 forecast of 150.28 million. Corn is projected to account for 92 per cent of total grain feed and residual use, down from a forecast 93 per cent in 2009/10.

The index of grain-consuming animal units (GCAUs) for 2010/11 is expected to be down slightly from the 2009/10 forecast of 91.5 million units. The grain used per GCAU would be 1.61 tons, down from 1.64 tons in 2009/10. In the index components, GCAUs for all types of poultry and hogs are up, while those for the other categories are down slightly, with cattle on feed being down the most. Cattle on feed in feedlots with capacity of 1,000 or more head totaled 10.5 million head on 1 June 2010. The inventory was one per cent above 1 June 2009. But, current feed use by cattle in feedlots is expected to decline in 2011. Beef production in 2011 is forecast at 25.2 billion pounds, down from 25.8 billion in 2010. In addition, some of the feed needs may be satisfied by increased use of distiller’s spent grains produced by the expanding ethanol industry.

Pork production in 2011 is expected to increase two per cent from the 22.3 billion pounds expected in 2010. Hog farmers responding to the June 2010 survey intend to have 2.89 million sows farrow during the June-August 2010 quarter, down two per cent from the actual farrowings during the same period in 2009 and down six per cent from 2008. Intended farrowings for September-November 2010, at 2.90 million sows, are down one per cent from 2009 and down four per cent from 2008. However, continued gains in pigs per litter result in larger supplies of slaughter hogs in 2011.

The broiler production forecast for 2011 is also raised as hatchery data indicate continued growth in bird numbers and increasing weights. Broiler production in 2011 is expected to increase three per cent from the projected 2010 production. Forecast turkey production in 2011 is up 1.9 per cent from 2010. Egg producers are expected to produce 7.62 billion dozen eggs in 2010, up 0.5 per cent from the projected 2010 output. Milk production in 2011 is forecast at 193.5 billion pounds, up from 191.2 billion pounds expected in 2010. These forecast increases in 2011 production will likely increase feed use.

Corn Production Decreases From Last Month in 2010/11
The projection for 2010/11 corn production was decreased one per cent from last month as a result of decreased plantings. Producers decreased plantings 926,000 acres from their March intentions to 87.9 million acres. Plantings are up from 86.5 million in 2009. Forecast harvested area is decreased 754,000 acres month to 81.0 million acres. The largest year-to-year increases in planted area were recorded in Illinois and Kansas, both up 600,000 acres from last year. Other notable increases were shown in Indiana, up 400,000 acres; Missouri, up 300,000 acres; and Ohio, up 250,000 acres. The largest declines occurred in Iowa, down 400,000, and Nebraska and South Dakota, both down 350,000 acres from last year. The national average yield projection remains unchanged from last month at 163.5 bushels per acre, down from 164.7 bushels per acre in 2009/10. As of 4 July, 71 per cent of the corn crop was rated in good to excellent condition, the same as this time last year.

 


 
Projected corn use for 2010/11 is down 50 million bushels this month to 13.36 billion. Feed and residual use and food, seed, and industrial (FSI) use remain unchanged at 5.35 billion and 6.06 billion bushels, respectively. Expected corn use for ethanol also remains unchanged this month at 4.7 billion bushels. Exports for 2010/11 were decreased by 50 million bushels to 1.95 billion bushels, as tighter domestic supplies, strong demand from ethanol production, and rising prices reduce the export competitiveness of US corn. As a result, 2010/11 ending stocks were projected 200 million bushels lower at 1.373 billion.

For 2009/10, projected corn use is up 125 million bushels from last month to 13.315 billion bushels. Feed and residual is raised 175 million bushels from last month to reflect higher-than-expected third-quarter (March-May) disappearance as indicated in the 30 June Grain Stocks report. FSI use is lowered 50 million bushels this month, as corn used for ethanol is lowered 50 million bushels, reflecting the latest ethanol production data from the Energy Information Administration (EIA). Although daily ethanol disappearance set another record in April, daily production slipped below March’s record pace. EIA’s new weekly ethanol production data series (first reported for the week ending June 4) suggests June production, while up from April, will not reach the pace seen in March. Corn exports for 2009/10 remain unchanged this month at 1.95 billion bushels.

With 2010/11 ending stocks projected lower this month, prices are projected higher. The marketing-year average farm price for 2010/11 is projected at $3.45 to $4.05 per bushel, up 15 cents on both ends of the range. The 2009/10 marketing-year average price is expected to be $3.50 to $3.60 per bushel.

Sorghum Production Prospects Trimmed in 2010/11
Sorghum production in 2010 is projected at 350 million bushels, down five million from last month and down 33 million bushels from last year, as producers in Texas and Kansas decreased their planted area by 11 per cent in both states. Sorghum planted and harvested acreage is forecast at 6.0 million and 5.2 million acres, respectively. Planted area is down 360,000 acres from March intentions. The projected yield is increased from last month to 67.6 bushels per acre, reflecting adequate to abundant soil moisture in the Southern and Central Plains. As of 4 July, 71 per cent of the sorghum crop was rated in good to excellent condition, compared with 51 per cent last year at this time.

Sorghum supplies in 2010/11 are expected to decrease from last month because of decreased production and lower carry-in. For 2010/11, total use is lowered five million bushels because of smaller expected supplies. The decrease was reflected in feed and residual use, which was lowered five million bushels to 105 million.

For 2009/10, feed and residual was raised five million bushels because of increased use indicated by the 1 June stocks. Exports remain unchanged at 170 million bushels. As a result, ending stocks for 2009/10 are lowered five million bushels this month to 28 million.


 
The forecast farm price for sorghum in 2010/11 is $3.15 to $3.75, which is 91 to 93 per cent of the corn price. The projected price for 2009/10 is $3.10 to $3.20 per bushel.

Barley Production Down in 2010/11
The first survey-based forecast of 2010 barley production is 182 million bushels, down eight million from the previous projection and down 45 million from the 2009 crop. Planted area was down 301,000 acres from earlier intentions and down 595,000 acres from 2009. Harvested acreage is estimated at 2.5 million acres and is down 567,000 acres from 2009. The expected decline in production is a result of the lowest planted acreage on record and the lowest expected harvested acreage since 1883. The average barley yield is forecast at 71.6 bushels per acre, up from last month's trend-based projection of 66.9 bushels. If realised, the 2010 yield would be second only to last year’s record of 73.0 bushels per acre. As of 4 July, 85 per cent of the crop was rated in good to excellent condition, compared with 77 per cent last year at the same time.

Total barley use in 2010/11 is unchanged from last month and up seven million bushels from 2009/10. Imports in 2010/11 are lowered five million bushels this month as a result of low planted area in Canada. This is down two million bushels from the prior marketing year. Small changes were made in 2009/10, reflecting the 1 June Grain Stocks, which finished the marketing year for barley. Imports were unchanged at 17 million bushels. Feed and residual use was lowered one million bushels, and food, seed, and industrial use was lowered one million bushels. Ending stocks were reported at 115 million bushels, up from the earlier estimate of 113 million for 2009/10.

Prices received by farmers for barley in 2010/11 are expected to average $3.50 to $4.10 per bushel, up 15 cents on both ends of the range. The 2009/10 season average price for barley is raised one cent to $4.66 per bushel, due to historical revisions in monthly prices from USDA’s National Agricultural Statistics Service. The spread between malting barley and feed barley prices is projected to be down from last year, as contract prices for malting barley were not as high as seen last year. In 2009/10, the spread was $2.41 vs. $1.89 in 2008/09.

 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 15, 2010, 10:32:09 AM
Oats Production at Record Lows
According to the first survey results, oats production is forecast at a record low of 88 million bushels for 2010, down two million bushels from last month’s projection and down five million from 2009. Planted acres are down 188,000 acres from the March intentions, and harvested acres are also down from last month’s projection. Yields are forecast at 66.7 bushels per acre, up 1.2 bushels from the trend yield used last month but down 0.8 bushels from 2009. At the forecast, yields for 2010 would be second only to last year’s record 67.5 bushels per acre. As of 4 July, 81 per cent of the crop was rated in good to excellent condition, compared with 59 per cent last year at the same time.

Beginning stocks for oats are estimated at 80 million bushels for 2010/11, down seven million bushels from last month based on 11 June stocks. Despite decreases in supply, total use in 2010/11 remains unchanged this month, resulting in a 19-million bushel decrease in ending stocks.

For 2009/10, feed and residual use was raised five million bushels to account for reported 1 June ending stocks. Imports were also lowered three million bushels to 95 million. Ending stocks are estimated at 80 million bushels for 2009/10. Oats farm prices are projected at $2.10 to $2.70 per bushel for 2010/11, which was raised 25 cents on both end of the range, as prices for all feed grains have increased with decreasing supplies. In 2009/10, the season-average farm price for oats is estimated at $2.02 per bushel.

 
Hay Acreage Down in 2010/11
Producers expect to harvest 59.7 million acres of all hay in 2010, down slightly from 2009. Expected harvested area of alfalfa and alfalfa mixtures, at 20.7 million acres, is down 495,000 acres from 2009. Expected area for harvest of all other types of hay totals 38.9 million acres, up 396,000 acres from 2009.

Harvested area for alfalfa and alfalfa mixtures is expected to decrease or remain unchanged from last year in all states except Arizona, Montana, New York, Oregon, Texas and Utah. While Montana acreage is expected to increase 100,000 acres, large decreases are expected in North Dakota and Minnesota, down 180,000 and 100,000 acres, respectively.

Compared with amounts last year, area harvested for all other types of hay is expected to increase by 100,000 acres or more in Missouri, Montana, Texas, Virginia, and Washington. Texas is expecting the largest increase in acreage as producers look to replenish hay supplies after last year’s severe drought. However, decreases of 100,000 acres or more are expected in Kansas, Kentucky, New York, Oklahoma and South Dakota.

World Coarse Grain Production Prospects Cut This Month
Global coarse grain production forecast for 2010/11 is reduced 10.8 million tons to 1,117.6 million, a cut of about one per cent this month. Much of the decline is in other countries, down 7.3 million tons to 766.8 million, and in barley, with foreign production prospects cut 6.7 million tons to 131.6 million. Foreign oats production is reduced 0.8 million tons, corn and rye are trimmed 0.2 million each, and sorghum is virtually unchanged, but mixed grain is increased 0.6 million due to improved prospects in Germany and Hungary.

Foreign corn production prospects are reduced slightly to 495.9 million tons this month. Russia’s projected production is reduced 0.5 million tons to 5.0 million as planting reports indicate that harvested area will not expand as much as previously forecast. In the EU, a 0.3-million-ton increase in corn production prospects is caused by small improvements in prospects for several countries, more than offsetting a decline in corn area for France.

Global barley production prospects for 2010/11 are cut five per cent this month to 135.5 million tons. The largest drop is for Russia, down 2.5 million tons to 13.0 million. Serious drought and severe high temperatures in the spring grains areas of the Volga region and the Urals, with dryness extending into parts of Siberia and the Central production region, are sharply curtailing spring barley production prospects. The same drought extends into Kazakhstan, where expected barley production is cut more than 30 per cent this month to 1.8 million tons.

 
Canada’s barley production prospects are cut 1.1 million tons this month to 8.4 million as excessive rains and below-normal temperatures during the second half of May and the first half of June in the Prairie Provinces (especially in parts of Saskatchewan) left many fields too wet for field work and planting. Canada’s barley area is cut 12 per cent due to the planting problems. The same wetness prevented oats planting, cutting Canada’s oats area 26 per cent and slashing production prospects 0.9 million tons to 2.8 million.

The EU has suffered from excessive rains in the east, disrupting barley harvests in the Balkans, but below normal precipitation in England, northern France, across the low countries, and into northern Germany. EU barley production is reduced 2.4 million tons this month to 56.4 million. The largest reductions are for France and Finland, with smaller declines for Germany, Spain, Hungary, Italy, the Czech Republic, Sweden, Austria and Portugal.

Forecast 2010/11 global beginning stocks of coarse grains are reduced 4.1 million tons this month, contributing to tighter supplies, but most of the reduction is for the United States. Foreign beginning stocks are down only 0.7 million tons to 146.8 million. EU coarse grain beginning stocks are reduced 0.5 million tons, mostly due to increased 2009/10 barley exports and a slight reduction in 2009/10 production. Brazil’s 2010/11 beginning stocks are reduced 0.5 million tons this month because of increased 2009/10 corn exports. Russia’s barley beginning stocks are trimmed 0.4 million tons due to increased 2009/10 exports. Partly offsetting the reductions are increased beginning stocks of corn, oats and barley for Canada, and barley for Saudi Arabia.

 
Coarse Grain Consumption Prospects, Ending Stocks Trimmed
Projected global 2010/11 coarse grain use is down 3.2 million tons this month to 1,126.2 million. Russia, with reduced production, is forecast down 2.5 million tons to 26.9 million. The largest cut in use is for barley, down 1.7 million tons, with corn reduced 0.5 million and rye 0.3 million. The reduction in feed and residual use of 2.0 million tons is offset by an increase in expected wheat feeding, as meat production prospects in Russia continue to be for strong growth. EU coarse grain use is forecast down 0.8 million tons, with feed use of corn and barley each reduced 0.5 million tons and a small reduction in oats, partly offset by increased feed use of mixed grain. Meat production prospects in the EU are stagnant for 2010/11. There is also a small reduction this month in forecast feed use in Kazakhstan, as well as small increases for Brazil, Turkey, and Serbia.

World coarse grain ending stocks forecast for 2010/11 are down 11.8 million tons this month to 180.2 million. More than half the decline is in foreign stocks, down 6.0 million tons to 141.6 million. The largest decline is for the EU, down 2.5 million tons to 16.7 million. EU barley stocks are reduced 3.9 million tons this month to 8.3 million. With intervention no longer available for barley, its price is expected to decline compared to that for other grains, encouraging use, but grains prices are expected to be high enough to facilitate some reduction in stock levels. EU corn, rye and mixed grain projected ending stocks are up this month, partly offsetting the barley reduction. Canada, with reduced production, has coarse grain ending stocks reduced 1.0 million tons this month to 4.0 million. Kazakhstan, with reduced barley production, has ending stocks cut 0.6 million tons. With higher corn price prospects, Mexico is not expected to import as much corn to build stocks, trimming corn stocks 0.6 million tons. Brazil, with strong 2009/10 corn exports trimming 2010/11 beginning stocks, is projected to have ending stocks of corn 0.5 million tons lower. Ukraine, with increased corn export prospects, has ending stocks reduced 0.5 million tons this month. Russia’s barley ending stocks are reduced 0.4 million tons this month. Australia’s barley stocks are reduced 0.3 million tons as export prospects improve with reduced competition. Barley stocks are increased 0.3 million tons this month for Saudi Arabia due to increased 2009/10 imports.

US Corn Export Prospects for 2010/11 Reduced This Month
US corn exports for October-September 2010/11 are reduced 1.5 million tons to 49.5 million (down 50 million bushels to 1.95 billion for the September-August local marketing year). Tighter supplies and strong domestic demand are expected to increase corn prices, limiting the competitiveness of US corn exports. World corn trade for 2010/11 is projected down 0.5 million tons to 89.7 million, as increased corn prices trim Mexico’s imports 0.5 million tons to 9.1 million. Ukraine and Brazil are expected to benefit from reduced US competition, and corn exports are raised 0.5 million tons each.

Barley world trade projected for 2010/11 is increased 0.4 million tons to 16.5 million. China’s imports are up 0.4 million based on strong demand for malting barley to meet beer demand. Reduced production prospects slash Russia’s exports 0.8 million tons to 1.0 million and cut Canada’s exports 0.4 million tons to 1.0 million. There is also a small reduction in Kazakhstan’s exports. With large stocks, EU barley exports are increased 1.4 million tons despite reduced production. Reduced competition is also boosting export prospects for Australia.

US corn exports for 2009/10 are unchanged this month at 49.0 million tons. Census exports for October 2009 to May 2010 reached 31.5 million tons, and June grain export inspections of corn reached 4.1 million tons. As of 1 July 2010, outstanding export sales for shipments in 2009/10 reached 9.9 million tons. However, the pace of recent shipments indicates that a larger-than-usual share of the 1 July outstanding sales are likely to get carried into the next marketing year. World corn trade in 2009/10 is increased slightly this month to 85.9 million tons mostly due to a small increase in corn exports for Ukraine. Corn imports for South Korea are increased 0.4 million tons to 8.2 million. 

July 2010
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 21, 2010, 09:42:07 AM
Weekly Outlook: Focus on Weather and Crop Size
US - Corn and soybean prices managed an impressive rally during the first half of July, writes Darrel Good, agricultural economist at the University of Illinois.



That rally was initiated by smaller than expected June inventories and smaller than expected corn acreage revealed in USDA's 30 June reports. The rally was supported by strength in wheat prices that reflected declining wheat crop prospects in a number of important production areas.

Strength in corn and soybean prices late last week reflected concerns about the potential impact of the forecast for widespread and lingering high temperatures across the US Updated forecasts for more widespread and abundant precipitation this week moderated some of last weeks' yield concerns. Most of the crop concern is centered on corn due to prospects for relative small stocks at the end of the current marketing year and prospects for a continuation of a high rate of consumption during the 2010-11 marketing year. Consumption next year is expected to be supported by increasing use of corn for ethanol production, although there is some concern about reaching the blend wall in early 2011. Most remain optimistic that the Environmental Protection Agency will approve a higher ethanol blend, at least for some vehicles, that would expand the potential market for mid-level blends. There is also concern that the $.45 per gallon blender's tax credit for ethanol which expires at the end of this year will not be renewed, or more likely, will be renewed at a lower rate. Current price relationships in the ethanol and gasoline markets suggest that a lower tax credit rate would not reduce the incentive for blending. The concern would be that the price relationships change so that a lower tax credit rate would reduce those incentives. A case might be made for a variable tax credit rate that reflects changing price relationships and blending economics.

The other sectors of the corn market are expected to experience stable consumption patterns. The USDA currently forecasts non-ethanol processing uses of corn during the year ahead at 1.36 billion bushels, only 20 million bushels above the forecast for this year. Feed and residual use is projected at 5.35 billion bushels, 175 million less than the inflated projection for the current year resulting from the small estimate of 1 June inventories. US corn exports during the year ahead are forecast at 1.95 billion bushels, equal to the forecast for the current year.

There is a fair amount of uncertainty about export demand for US corn. Through 15 July, the USDA reports cumulative export inspection during the current marketing year at 1.608 billion bushels. Through May, cumulative Census Bureau export estimates exceeded inspections by 77.7 million bushels. If that margin has been maintained, exports during the last 6.7 weeks of the year need to total 264 million bushels, an average of 39.4 million bushels per week, to reach the USDA projection of 1.95 billion bushels. Inspections over the 11 weeks ended July 15 averaged 40.8 million per week. It appears that shipments are on pace to reach the projection. Unshipped sales of US corn for delivery during the current marketing year stood at 373.8 million bushels on 8 July, well above that needed to reach the USDA projection. Export sales for delivery during the 2010-11 marketing year stood at a relatively small 101 million bushels as of July 8, including only 2.4 million bushels to China. Export sales for next year, however, could accelerate if world wheat production prospects continue to decline.

There is a little less concern about the US soybean crop even with small inventories due to prospects for reduced consumption of US soybeans during the year ahead and the 1.4 million acre increase in US planted acreage this year. With a trend yield in 2010, the USDA expects 2010-11 marketing year ending stocks of US soybeans to reach a four-year high of 360 million bushels. An average yield slightly below trend would still leave expected stocks at a relatively high level.

In general, expectations for the US average corn yield this year have declined slightly, but are still relatively high. The wide range of yield expectations reflects the differing assessments of the impact of weather conditions to date and uncertainty about upcoming weather. Record or near record June rainfall in much of the Midwest may have had a negative impact on yield potential, but that is not accepted by all analysts. Even more subtle is the likely net impact of July temperatures slightly above average this year compared to the record or near record low temperatures of 2009. The USDA will release the first forecast of yields based on surveys and field observations on 12 August. The price impact of that forecast could be significant.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on July 26, 2010, 10:48:48 AM
Thailand faces severe cassava shortage
[26 July 2010] Thailand is facing a severe shortage of cassava as the production in 2010/2011 crop year is estimated to plummet sharply from last season, according to a recent crop survey by the Thai Tapioca Trade Association. Growing area for this crop has reduced to 7.3 million rais (1.17 million hectare) from 7.8 million rais (1.25 million hectare), decreasing cassava output for this crop to about 15 million tonnes from around 21 million tonnes. Businesses that use tapioca as raw material for feed will be affected by the situation, the association said.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 10, 2010, 12:02:18 PM
Price of barley up
[10 August 2010] The price of barley, in the last six weeks, has more than doubled to €210 a tonne (USD 279), up 130% from €90 a tonne. Barley now is trading at par with milling wheat. This comes after the drought affecting Russia and Ukraine, and it may prompt the cost of meat and poultry to rise to about 15%. Barley production is also down in the European Union and Canada.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 10, 2010, 12:23:07 PM
Wheat Prices Set to Remain High for a Decade
NETHERLANDS - High wheat prices are not a one-off, according to a senior Rabobank official.



Wheat prices will remain high for the next ten years, says Rabobank's Director of Commodities, Dirk Jan Kennes. The current price peak is not only down to the Russian drought, it signals a structural change in the market. The US could offer short-term solutions. But long-term the food industry must improve efficiency, or charge consumers more for bread, beer and meat.

Wheat prices have risen by more than 50 per cent since the end of June, topping EUR 200 per tonne, according to Rabobank. The immediate cause of the spike is the continuing drought in Russia, Ukraine and Kazakhstan, which is devastating crops. EU producers France and Germany are also bracing for poor harvests. Prices rose even further this week as President Putin announced a ban on grain exports from 15 August to the end of the year.

Demand rising
Mr Kennes said: "On the surface, this situation feels like the food crisis of 2007 and 2008. "Poor harvests are once again driving the price-spike. But global stock levels are much higher right now than at that time. So this time round, we should be able to cope better with the production declines."

For the first time since the 2008 food crisis, we are producing less wheat than we consume. Growing populations and rising prosperity are causing this growth in demand. Changing consumption patterns in countries like China and India mean more people are eating wheat-based products. And as people become more prosperous, they start to eat more meat.

Mr Kennes explained: "Not everyone makes the connection between meat and wheat. But grains are essential elements of animal feeds. For every kilogram of chicken you buy in the shop, you need two kilogrammes of animal feed."

Global stocks falling
Although stock levels are currently high, the world probably does need to deal with lower average stocks. "Tighter grain markets on the one hand, and a more liberal EU agricultural policy on the other will leave less room to buffer potential production shortages. So prices will fluctuate much more. Stocks are now around the same level as just before the food crisis in 2007. But if you adjust the figures for India and China, global stocks are lower," says Mr Kennes.

After the EU, China is the biggest wheat producer in the world. But, like India, it uses most of its harvest to feed its own enormous population. Self-sufficient countries that do not bring their product to market have a limited impact on the world price.

Shift in wheat production
In the last three years, wheat production has increased by 15 per cent, from 600 million tonnes in 2007 to 680 million tonnes in 2008 and 2009. The bulk of the extra wheat came from countries in the former Soviet Union and the EU, picking up the slack left by US farmers as they switched their wheat acreage to corn and soybeans. But as harvests fail in Europe, there may still be relief in sight from the US.

Mr Kennes explained: "Although wheat acreage has shrunk, we are expecting big export volumes in the US. This could meet demand and prevent further reduction of stocks. India currently holds strategic stocks of 14 million tonnes, in contrast to their normal level of eight million tonnes. So if the US harvest does disappoint, the solution may lie in the East."

Risk management for food industry
On the production side, it is not enough for farmers to bring new land into operation. They also need to improve their yields. This all brings higher costs, which in turn pushes up prices. If wheat price volatility stays at structural high levels, it will have a significant impact on margins and risk distribution in the food supply chain.

Mr Kennes concluded: "Companies in the food supply chain responded to the price volatility in 2007 and 2008 by taking positions on the futures markets and hedging their risks. They should still take these operational measures and keep a very close eye on the commodities markets, bearing in mind that timing is all-important. But they also need to consider strategic options such as consolidation. The industry must improve its operating efficiency to absorb the rise in cost prices. Otherwise, the cost of bread, beer and even meat, could rise in the shops."

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 10, 2010, 12:37:37 PM
How the Global Wheat Shortage May Impact the Pig Industry
Based on current price predictions, the UK pig industry will experience a return to negative returns from November this year, according to a briefing document from BPEX. Other countries are likely to be hit just as hard, either directly from the price rises in wheat, barley and soybeans or indirectly from competition for other feed ingredients.

 

Introduction
At present feed represents between 55 to 60 per cent of the total cost of production of pig meat for all European pig industries. Within the cost of feed the principal ingredients are the cereals (wheat and/or barley) and soybean meal, which can account for up to 80 per cent of the ration. Clearly, therefore, the cost of pig feed rations and the total cost of pig production is highly sensitive to changes in the raw material prices of these commodities on the world market.

As has been well-documented in recent weeks and days, wheat prices have risen at their fastest rate since 1973 with markets witnessing the biggest jump in July from £103 to £143 per tonne due to concerns of drought conditions throughout the major cereal-growing areas of Europe and Russia and the resultant impact on yields.

This short briefing note aims to quantify the impact of recent price rises on the cost of pig meat production and forecast future movements in commodity prices and how this may impact upon the pig meat supply chain.

Summary
Feed represents up to 60 per cent of the current costs of pig production of which the main ingredients are wheat, barley and soya. During July, global and domestic wheat prices increased almost 40 per cent and further quoted prices forecast further increases.

Based on current and forecast prices for wheat, barley and soya – which are the main ingredients in pig feed – it is anticipated that the cost of English pig production will rise from 137.2p per kg in June 2010 to 146.35 per kg in November 2010.

The impact of these increases in cost of production is that English pig producers will move into negative returns for every pig slaughtered subject to future movements in the DAPP.

This situation is not unique to the English pig industry. All European pig industries are faced with the same challenges from the global feed market and the impact on their profitability is identical, subject to their individual pig price movements in the near future.

Overview of Commodity Markets – Wheat, Barley and Soybeans
Wheat
At the start of 2010, the global wheat market was in a heavily supplied bearish state. With ending stocks for the '09/10 season estimated at near 200 million tonnes and a forecast third-highest harvest on record, the supply side dominated the market. However, the weather has yet again thrown a spanner in the works. With the worst drought for 130 years hitting Russian grain crops, the world has become very nervous in a short space of time about the availability of wheat from Russia and the Black Sea region. Information from the region is not particularly transparent and so rumour and conjecture on the impact of the heatwave on grain crops have been key market drivers. The nervousness in the market has been spurred on by increased investment fund activity and a weaker US dollar over the past month.

The main driver has been the European market with MATIF wheat in Paris up €57.50 per tonne over the past month, to close on 2 August at €207.25. UK prices have followed with new-crop LIFFE wheat futures for November 2010 gaining over £40 per tonne through July alone. Wheat futures prices for July 2011 delivery increased by 36 per cent since the start of June.

Wheat prices in the US hit near two-year highs recently, with CBOT wheat standing at $254.7 per tonne on 2 August, some $75 higher than a month earlier. The wheat prices have surged above the maize price in the US, with wheat now at a $106 per tonne premium above maize. As a result, this price spread makes wheat in the US less attractive into feed rations and there is the potential for feed wheat demand to lessen.


Barley
The barley market has very much followed the price surges in the wheat market over recent weeks. The concerns over the poorer-than-expected yields in Europe and the expected lower crops in the Black Sea region have prompted feed compounders across Europe to lobby the EU to release barley stocks from intervention to alleviate the expected lower supply. However, in mid-July, the EU announced that it had no plans to allow the release of barley intervention from stocks but that it would continue to monitor the situation.

The latest estimates of barley production in Europe are at 54.1 million tonnes, well down from 61.8 million tonnes produced a year ago. The main reason for the lower production is firstly a lower planted area from barley with gross margins looking poor in comparison to feed wheat and oilseed rape; and secondly, the heat-wave through June and July reducing the crops yield potential. Europe is still expected to carry in over 11 million tonnes of barley in commercial stocks.

Soybean meal
The soybean meal market has been supported by spill-over support from buoyant grain prices over recent weeks. The market has also seen support from tight supplies in North America and a strong demand for raw bean imports into China. Soybean meal prices have been on an upward trend since mid-March, hitting highs of $350 per tonne in early July. The UK market, and subsequent prices, will be very much influenced by these global factors. soybean meal prices in the UK have gained from £275 per tonne in early March to £300 in late July. However, the strengthening of UK sterling against the US dollar over recent weeks will have the effect of making US dollar denominated imports into the UK cheaper in sterling terms and as such will partly negate the price rises seen in US markets.

Looking forward, the soybean market is expecting a record US crop this year, with the 2010 harvest currently estimated at between 91 and 93 million tonnes. The US has seen very beneficial growing conditions this season and the crop is currently forming yield with very little weather concerns. The soybean market now awaits the final size of this US crop to then gauge the relative supply availabilities through 2010/11. However, the global supply and demand within the soybean market remains robust. As in 2010/11, global soybean production is estimated at 251 million tonnes (259 million tonnes in 2009/10); demand is seen 12 million tonnes higher than the season prior at 247.6 million tonnes, with Chinese import demand seen at one-fifth of world production at 50 million tonnes. So, the potential record bean crop in the US gains more significance as demand is forecast to increase in 2010/11.


Current and Forecast Cost of Production

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*
"Even if producer prices maintain their current value, the industry is forecast to be making a loss by the final quarter of 2010." 

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The cost of production in the pig industry improved during 2009 mainly due to reduced input costs of feed and improvements in physical performance. During 2009, the average cost of pig production was 127.9p per kilo, a seven per cent reduction compared with a year earlier. Despite efficiencies in terms of breeding herd prolificacy and growth rates, the industry has been exposed to higher energy, labour and building costs. Following a prolonged period of negative margins for the industry, returns achieved during 2009 allowed the opportunity for greater investment in new buildings.

However, costs of production remain dominated by feed. Costs of production have increased during 2010 and in July the estimated cost of production was 137p per kg.

During 2009, feed accounted for 52 per cent of production costs, a reduction from 56 per cent a year earlier. However, in July 2010, feed was estimated to account for 57 per cent of total pig production costs.

As new feed contracts are being negotiated, there is concern that the industry will once again become loss-making as, at the time of writing, futures prices continue to rise at a time where the producer price has fallen for five consecutive weeks, following a seasonal trend. Taking into account the futures prices and the likely knock-on effect to feed rations, the return to producers is important in terms of maintaining a sustainable business. Even if producer prices maintain their current value, the industry is forecast to be making a loss by the final quarter of 2010.

This current situation is not limited to the UK industry. The grain market is global and other European pig producing nations are experiencing a concentrated impact of increased input costs. EU member states have not experienced similar profitability that the UK has experienced over the last 18 months. As a result, the sustainability of many European pig producers will come into question if higher feed prices are realised.


Conclusions
Based on current and forecast prices for wheat, barley and soya which are the main ingredients in pig feed, it is anticipated that the cost of English pig production will rise from 137.2p per kg in June 2010 to 146.35p per kg in November 2010.

The impact of these increases in cost of production is that English pig producers will move into negative returns for every pig slaughtered subject to future movements in the DAPP.

This situation is not unique to the English pig industry. All European pig industries are faced with the same challenges from the global feed market and the impact on their profitability is identical, subject to their individual pig price movements in the near future.

August 2010
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 14, 2010, 01:50:06 PM
Japan plants more feed rice
[12 August 2010] Producing rice for animal feed is attracting farmers' interest in Japan recently. Soaring prices of imported feeds plus the fact that it is easy to grow and generates a higher yield has made it attractive. The production increase also has been boosted by a subsidy system introduced this fiscal year by the  government to improve the nation's self-sufficiency in food through efficient use of rice paddies. Under the system, a farmer is granted JPY 80,000 (USD 940) per one-tenth of a hectare for growing rice for animal consumption or other crops. According to the Agriculture, Forestry and Fisheries Ministry, 1,611 hectares were planted with feed rice in 2008, a sharp increase from 292 hectares in 2007. The figure was expected to reach 4,129 hectares in 2009.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 14, 2010, 01:51:20 PM
USDA predicts higher corn and soy prices
[13 August 2010] Despite the USDA's forecast of record corn and soybean crops this year, prices are epected to rise on global demand. The higher price is being driven by lower foreign production which will more than offset the higher U.S. output.The average corn prices for the 2010/11 marketing year beginning September is at USD 3.50 - 4.10 per bushel, up five cents on each end of the range from a month ago. US soybean prices for the same period is expected to be in a range of USD 8.50 - 10.00 per bushel, a 40-cent increase on each end of the range.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 14, 2010, 01:55:37 PM
Friday, August 13, 2010
CME: USDA Expects Largest Average Corn Yield
US - Steve Meyer and Len Steiner comment on the latest Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports in their Daily Livestock Report (DLR) for 13 August 2010.



USDA’S monthly Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports, released this morning, contained forecast yields and crop sizes for corn and soybeans that were all higher than last month’s USDA estimates and higher than the averages of analysts pre-report estimates — and corn, soybean and soybean meal prices all closed higher for the day. That relationship is not what one would expect if the pre-report estimates are providing an accurate picture of the information that is “in the market” before the report.

We are loathe to believe — and are not at all suggesting — that analysts would provide numbers that are not what the indeed expect to happen but in this instance it appears those numbers were not representative of “market” expectations. The pre-report estimates usually do a better job of representing market sentiment — but not this time. The table below contains the estimates published in Wednesday’s DLR with the actual figures added in the shaded column. 2010-crop corn futures closed 8-1/4 to 10-3/4 cents/bushel higher today while 2010- crop soybean futures rose 9-1/2 to 13-1/2 cents/bushel.


USDA is now expecting the largest average national corn yield and largest US corn crop in history at 165 bu./acre and 13.365 billion bushels, respectively. Those eclipse last years’ records of 164.7 bu./acre and 13.110 billion bushels. USDA’s forecast for this year’s soybean yield (44.0 bu./acre) matches last year’s record while forecast soybean production of 3.433 billion bushels would, like the corn crop, break last year’s record, 3.359 billion bushels.

All of those records, however, are of little solace to livestock and poultry growers. The reason is apparent from the chart and the supply and utilisation (S&U) table for corn. While the 2010 corn crop may well be record large, USDA changed its estimates of three corn uses for the current crop year with the net effect of reducing projected 2010 carryout stocks to1.426 billion bushels. That reduction plus increases in Non-ethanol food, seed and industrial (FSI) usage (30 million bushels) and exports (100 million bushels) in the coming crop year pushed projected 2011 carryout stocks to 1.312 billion bushels, their lowest level since 2006. Perhaps more important is this fact: 1.326 billion bushels of corn just ain’t what it used to be!! That level of year-end stocks represents just 9.7 per cent of total 2010-2011 usage and would be the fourth smallest year-end stocks-to-use ratio since 1970 and over 2 per cent smaller than the ratio in 2006, the year that marked the launch of the biofuels era for corn prices. USDA raised both ends of its forecast range for the season- average corn price by 10 cents/bushel. The range is now $3.50 to $4.10/bu.

 


USDA’s forecasts for record soybean yields and crops were also offset by increases in usage estimates for both this and next crop years. Larger exports and crushings pushed already-tight 2010 year-end stocks to an even tighter 160 million bushels. That is still larger than last year’s level but not by much — 4.8 per cent S/U ratio this year vs. 4.5 per cent last year. About the only factor keeping near-term soybean and soybean meal futures from moving sharply higher on these tight year-end stocks is the better prospect this year of an at-least timely harvest. The impact of last year’s tight supplies was exacerbated by late planting and cool summer temperatures that delayed soybean maturity. This year’s soybean planting pace was not much better than that of 2009 but the growing season has provided more heat units and, in most areas, ample moisture that has 8 per cent more acres blooming and 19 per cent more acres setting pods this year versus last as of August 8. USDA added 40 cents/bu. to both ends of its forecast range for soybeans to put it at $8.50 to $10.00. They also added $10/ton to both ends of the soybean meal range, putting it at $250 to $290/ton — pricey but still much lower than last year’s average of $310/ton.


While not having much DIRECT impact on US producers, world wheat supplies and prices remain a key driver of these grain markets. USDA lowered projected world wheat production by 15.3 million tonnes to 645.3 million. Russia (-8.0), Kazakhstan (-2.5), Ukraine (-3.0)and EU-27 (-4.3) accounted for all of the decrease. The decline in world wheat output drove projected world wheat trade down by 5.7 million tonnes. US wheat exports were increased by 200 million bushels (5.4 million tonnes), up 20 per cent from July.



Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 14, 2010, 01:57:30 PM
Friday, August 13, 2010 US Stands to Pick Up Wheat Forfeited by Russia
US - The United States stands to gain a good share of the wheat export market that Russia is forfeiting due to the Russian government’s decision to halt grain exports until the end of the year, according to John Anderson, an economist with the American Farm Bureau Federation.



The Agriculture Department yesterday released its August World Agricultural Supply and Demand Estimates or WASDE report. In the report, USDA projected a huge drop in Russian wheat exports for the 2010-2011 marketing year: 3 million metric tons, compared to 18.5 million metric tons, in the 2009-2010 marketing year. Russia decided to exit the grain export market this year because of a serious drought that is reducing crop prospects.

“This is a jaw dropping reduction in exports for Russia,” Dr Anderson said. “And because the United States is expecting a good wheat crop with good stock levels, our farmers stand to take up a big share of wheat exports that would have gone to Russia.”

US all wheat production is estimated at 2.26 billion bushels, up 2 per cent from the July forecast and up 2 per cent from 2009, according to the latest WASDE report. USDA is also projecting the highest US wheat yield ever at 46.9 bushels per acre, up 1 bushel per acre from July and up 2.5 bushels per acre from last year.

The US stands to pick up export business because of expectations for a good crop and large wheat stocks, at just under 1 billion bushels.

“The United States should pick up almost half of the wheat exports that would have gone to Russia,” Dr Anderson said. “We have wheat when the other major exporters don’t have as much wheat.”

Dr Anderson said it is important to note that global wheat stocks are still strong.

“We don’t have to worry about a global shortage of wheat right now, despite the difficulties in the Russian wheat market,” he said. “Overall, global wheat stocks aren’t all that tight, and the winter wheat crops in Argentina and Australia, who are big producers and exporters in the Southern Hemisphere, are looking pretty good so far. Futures have already retreated quite a bit from the highs set on the day of the Russian export ban announcement. Markets will begin to calm down over the next few days as everyone comes to terms with these adjustments.”

In addition to the import news impacting the wheat crop, Dr Anderson said the August WASDE report is important for the corn crop, and it is being closely studied by the market.

“The big news is USDA is forecasting a record corn crop, a record yield and record use,” Dr Anderson said.

In addition to more corn going in to ethanol production, USDA is forecasting more corn to go in the export market, to make up for the lost Russian grain exports.

“Wheat is used as a feedstock for livestock in many countries, and because not as much wheat will be available for export, many countries will turn to corn to meet the needs,” Dr Anderson said.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 25, 2010, 10:18:40 AM
Chinese buyers show strong interest in US soybeans
[25 August 2010] Chinese soybean buyers have maintained strong interest in back-month shipment of US soybeans due to positive crushing margins, said the state-run think tank China National Grain and Oils Information Center (CNGOIC).  American soybeans scheduled to ship in December was quoted at USD 477/tonnes or CNY 3,810/tonne C&F, providing an anticipated margin of CNY 166/tonne from hedging on the domestic market, CNGOIC said in its weekly report. The record high June and July soy imports have driven up domestic inventory to 6.8 million tonnes, an increase of 3.3 million tonnes from the same period in 2009.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on August 31, 2010, 11:36:38 AM
Philippine corn production to drop 11.7% this year
[31 August 2010] Philippine corn production will go down 11.7% this year, government projections show. A report by the Bureau of Agricultural Statistics says that corn output will only reach 6.22 million tonnes for 2010 compared with 7.03 million tonnes last year. For the first half of the year, corn production was only 2.42 million tonnes, down by 25% from the same period last year due to lower yields and a decrease in harvested area.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 06, 2010, 10:43:44 AM
San Miguel corn program seen to hike corn production
[6 September 2010] Corn production in Eastern Visayas is expected to get a boost with the implementation of San Miguel Corporation (SMC)’s corn assemblers program. The program, a partnership between SMC, assemblers and corn farmers, has seen a 10% hike in the region’s corn output. Under the program, assemblers are to provide seeds and fertiliser to corn farmers and upon harvest, farmers are to pay the inputs with corn. The remaining corn yield will be bought by the assemblers, from whom SMC will consequently source the corn.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 09, 2010, 10:25:57 AM
Russia's Grain Export Ban Extended to 2011
RUSSIA - Russian President Vladimir Putin has extended his country's export ban on grain until at least the end of 2011, prompting further increases in wheat prices and fresh concerns about the impact on food prices.


Mr Putin said he could only consider lifting the export ban after next year's crop has been harvested and there is more clarity on grain levels.

Wheat prices have now risen by 50 per cent since the beginning of July.

Senior economist for the National Farmers Union of England and Wales, Phil Bicknell, said: "Although wheat prices have risen sharply over recent weeks, it's critical to remember that it's just one cost involved in producing and distributing foods. Any changes in retail price of products like bread tend to be relatively weak in comparison to the farmgate wheat price. We can also expect a time lag effect before rising raw material prices trickle down to the retail level.

"The bigger concern has to be rising wheat costs for animal feed. It is questionable to what extent these rising production costs will impact on farmgate prices. If the supply chain doesn't recognise higher feed prices, in the short term at least, rising production costs are more likely to result in tighter margins for farmers than increased farmgate prices."

Russia introduced the export prohibition on grain and flour on 15 August, following a devastating drought that destroyed around a quarter of the harvest.

NFU combinable crops board chairman, Ian Backhouse, said then that the decision emphasised the need to maintain productive agriculture at home.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 09, 2010, 10:27:46 AM
Weekly Outlook: Soybean Prices Remain Strong Too
US - Much of the attention in the crop markets in recent weeks has been focused on wheat and corn, writes Darrel Good, agricultural economist at the University of Illinois.



The wheat market has been dominated by the shortfall in production in Russia and the potential for a draw down in world wheat stocks. The corn market has been driven by strong domestic and world demand and by recent concerns about the size of the US harvest.

Soybean prices have traded in a wide range over the past two months, but fundamental developments have been less dramatic than in the wheat and corn markets. Over the next month, three USDA reports will add more clarity to the supply side of the soybean market. The first of those is the September 10 Crop Production report which will provide a new forecast of the size of the 2010 US harvest. A change in the forecast of harvested acreage is not expected, so the focus will be on the yield forecast. The USDA’s August Crop Production report forecast the US average yield at 44 bushels, equal to last year’s record and about 1.2 bushels above the calculated trend yield for 2010. Above average temperatures in many areas during August may have reduced yield potential, particularly in areas that also experienced below average precipitation during the month. For the most part, expectations are that the US average yield potential has not been reduced enough to alter the prospects for a record large harvest.

The second report is the 30 September Grain Stocks report which will reveal the level of old crop soybean stocks on 1 September, the beginning of the 2010-11 marketing year. Based on available data, it appears that soybean exports during the 2009-10 marketing year that ended on August 31 exceeded the USDA projection of 1.47 billion bushels. Cumulative export inspections through 31 August were reported at 1.46 billion bushels. From September 2009 through June 2010, cumulative exports as estimated by the Census Bureau exceeded inspections by 44 million bushels. If that margin continued through August, marketing year exports would have totaled 1.504 billion bushels.

In contrast, the 2009-10 marketing year domestic crush may fall just short of the USDA projection of 1.75 billion bushels. The crush during August needed to be 7 million bushels larger than during August 2009 to reach that projection. Monthly crush was below year ago levels from April through June and exceeded the year ago crush in July by only 300,000 bushels. On the surface, it appears that the inventory of soybeans on 1 September 2010 may have been smaller than the projection of 160 million bushels. However, the September stocks report has a reputation for containing some surprises and on occasion has resulted in a revision in the estimated size of the previous harvest.

The third report to provide supply information will be the USDA’s 8 October Crop Production report. In addition to providing a new forecast of yields, that report will also reflect administrative acreage information, primarily certified planted acreage data from the Farm Service Agency.

Prospects for export demand for the 2010 US crop will depend heavily on the strength of Chinese demand and the size of the 2011 South American crop. Currently, the USDA projects that China will import 1.91 billion bushels from all sources during the 2010-11 marketing year, up from 1.82 billion during the year just ended. While the 2011 South American crop is expected to be smaller than the huge 2010 crop, large inventories of the 2010 crop will keep supplies large and perhaps allow South America to capture more of the Chinese market. However, US export sales for the 2010-11 marketing year have started very strong. As of 26 August, the USDA reported sales for delivery during the current marketing year at 562.7 million bushels. New crop sales a year ago totaled 516.1 million bushels. Nearly 60 per cent of current outstanding sales are to China. Progress of the South American crop will become very important over the next few months as the developing LaNina weather pattern becomes important for the Southern Hemisphere.

Soybean futures prices remain above $10.00, resulting in cash prices at or above the upper end of the USDA’s projected range for the marketing year average price. Relatively high prices and a small carry in the futures market make harvest sales attractive for a portion of the crop.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 14, 2010, 09:50:51 AM
USDA raises corn price forecast
[13 September 2010] The USDA has raised its average corn price forecast to a range of USD 4.00-4.80 per bushel from USD 3.50-4.10 for the 2010/11 marketing year that began Sept. 1.The higher price forecasts came as it lowered its forecasts for U.S. corn production by 2% and lowered its corn ending stocks estimate based on expected lower yields and higher corn exports.Even though the corn crop, now predicted at 13.2 billion bushels, would still be a record, corn stocks as a percentage of total use could be the lowest since the 1995/96 crop year, USDA predicted in its World Supply and Demand Estimates and Crop Production reports.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 14, 2010, 09:52:26 AM
Soy prices to appreciate
[14 September 2010] The USDA raised its soybean crop forecast, but the prospects of stronger exports will deplete supplies, leading the agency to raise its projected 2010/11 average soybean price by USD 0.65 per bushel on both ends to a range of USD 9.15-10.65 per bushel. The agency raised its soybean meal price forecast by USD 20 on both ends to range of USD 270-310 per tonne.
Title: Re: Corn & Seed/Oil Commodities
Post by: jenny_pretty18 on September 15, 2010, 01:04:30 PM
Good day,
I would like to ask if what could be the possible crops, vegetable or fruit bearing trees to be planted here in Bulacan province wherein we could make a good profit? Who are my possible market? Thanks in advance and God bless..
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 16, 2010, 09:17:48 AM
All I know at this point is,market projections are saying higher livestock feed prices possible for 2011.
But as to what to plant and who is your market,thats the million dollar question.

Best of Luck
Title: Re: Corn & Seed/Oil Commodities
Post by: jenny_pretty18 on September 17, 2010, 03:29:05 PM
Actually we're alrready experiencing livestock feeds prices increase. Infact, our feeds distributor had already informed us that the increase of 40 php per bag was effective September 16. I hope we can still gain profit after this..

Thanks. Best of luck to you too..
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 18, 2010, 12:14:35 PM
Already started,livestock feed prices on the rise.

The BAI did suggest to some of the hog producers that the switch back to the native hog has some real possibilities for those affect by feed prices.

The BAI also stated that Trichantera mixed at 50% with commercial feeds was possible for growers and a cost cutter.

This is interesting.I wonder how many producers ever gave a second thought about mixing forages with commercial feeds to lower overhead costs while keeping more of the money in his/her own pockets?Maybe this is the future for the industry,experimenting with forages.

So true,profits margins are being squeezed out of the producer at every corner.
Best of Luck--remember,we are all in the same boat.
Title: Re: Corn & Seed/Oil Commodities
Post by: jenny_pretty18 on September 20, 2010, 01:49:15 AM
We are also giving our hogs some forages like ipil-ipil (leucaena glauca), malunggay, kangkong (ipomoea aquatica), camote tops and guava leaves but not as often as the BAI suggests. Usually, we gave these kind of forages to our gilts because these could help for good digestion especially to those gilts and sow that are constipated.
We all know that this practice could help minimize expenses. But what we are afraid is that could these forages lessen the weight of our fatteners?
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 23, 2010, 10:32:09 AM
US Feed Outlook - September 2010
A decrease in corn production for 2010 has been seen from last month, according to the USDA's Economic Research Service (ERS).

 

US feed grain supplies for 2010/11 are decreased this month with lower forecast corn and sorghum production, reflecting lower yields based on September 1 conditions. Corn feed and residual use is decreased with the larger crop, but exports are increased because of rising world demand for coarse grains. Global coarse grain supplies for 2010/11 are projected down, with reduced foreign and US production. With lower feed grain production, 2010/11 prices for corn, sorghum, and barley are projected higher.


Feed Grain Supply and Use Down
US feed grain production in 2010/11 is forecast at 349.1 million metric tons, down 5.4 million from a month ago and up slightly from 2009/10. Corn and sorghum production are both down from last month. Forecast beginning stocks are down 900,000 tons from last month and down 7.3 million from last year. Feed grain supplies in 2010/11 are forecast at 390.7 million tons, down 6.5 million from last month due to lower carryin for corn and decreased yield forecasts for corn and sorghum. Feed grain supplies are down 7.6 million tons from last year.

Total feed grain use in 2010/11 is projected down 1.3 million tons this month to 358.7 million. Total use is up slightly from 2009/10. Lower feed and residual use is partially offset by higher exports for both corn and sorghum. Feed grain use in food, seed, and industrial (FSI) use remains unchanged for 2010/11.

For 2009/10, feed grain use for FSI is raised 900,000 tons this month due to increased corn use for ethanol production. Exports are also raised slightly to 54.7 million this month,reflecting increasing shipments to date of corn, partially offset by lower sorghumexports. This lowers projected ending stocks to 39.7 million tons for 2009/10.

Feed Use
When converted to a September-August marketing year, feed and residual use for the four feed grains plus wheat in 2010/11 is projected to total 145.1 million tons, down 2.9 million from last month and down 3 per cent from the 2009/10 forecast of 149.7 million. Corn is estimated to account for 92 per cent of the feed and residual use in 2010/11, down from 94 per cent in 2009/10.

The projected index of grain-consuming animal units (GCAU) for 2010/11 is expected to slightly increase from the 2009/10 forecast of 91.5 million units. The grain used per GCAU in 2010/11 is expected to be 1.58 tons, down from 1.64 tons in 2009/10. In the index components, GCAUs are increased for dairy and beef but decreased for poultry from last month.

Milk producers continue to add cows to the herd, and inventories are forecast to increase into mid-2011; however, according to USDA’s 18 August Milk Production report, current inventories of milk cows still remain lower than those of last year. With increased milk production in 2011, feed use by the dairy industry is expected to be stronger.

The decrease in beef production is attributed, according to USDA’s 20 August Cattle on Feed report, to lower placements of cattle into feedlots and reduced cattle marketings. In addition, higher feed prices are encouraging cattle producers to keep cattle on forage longer, thus reducing feed needs for the cattle on feed relative to last month.

USDA’s Quarterly Hogs and Pigs report will be released on 24 September and will provide an indication of sow farrowing intentions into early 2011. Higher feed prices are expected to slow pork production gains and reduce feed use.

USDA’s Broiler Hatchery report on 8 September indicated that broiler-type eggs sets and chicks placed have been increasing. Cumulative placements of broiler flock are up 1 per cent from last year. However, with a shorter production cycle than red meats, broiler production is expected to respond more quickly to the higher grain prices and thus more quickly reduce feed needs. Inventory of egg-type chicks hatched that will produce table or market-type eggs has increased 5 per cent from last year, based on USDA’s 23 August Chickens and Eggs report. However, egg production in 2011 is projected to be unchanged from last month.

The lower feed prices in early 2010 have encouraged turkey producers to expand output for 2011 after reducing production in both 2009 and 2010. The increase in feed prices for 2011 is expected to temper production gains. Thus, feed use by the industry may be reduced slightly.

Corn Yield Cut, Record Crop Forecast
Corn production in 2010 is forecast at 13.160 billion bushels, down 205 million from last month but still 50 million bushels above 2009. Based on 1 September conditions, the average corn yield is forecast at 162.5 bushels per acre, compared with 165.0 bushels per acre last month and the estimated yield of 164.7 bushels per acre in 2009.

 


The 1 September corn objective yield data indicate the second highest number of ears per acre on record for the combined 10 objective yield States (Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin), only behind the record year of 2009. Record-high ear counts are forecast in Iowa, Missouri, Ohio, and Wisconsin.

Beginning stocks were lowered 40 million bushels this month to 1.386 billion. Forecast 2010/11 corn use was decreased 50 million bushels from last month to 13.440 billion, up 35 million from expected use in 2009/10. Exports were increased 50 million bushels to 2.100 billion as a result of reduced foreign supplies and increased global demand for feed grains. Feed and residual use of corn was lowered 100 million bushels to 5.250 billion because of lower supplies and higher prices. FSI use of corn remains unchanged at 6.090 billion bushels for 2010/11.

Projected corn ending stocks for 2009/10 are lowered 40 million bushels from last month to 1.386 billion. FSI use is raised 35 million bushels to 5.900 billion. This increase is in corn used for ethanol, based on record July and August production of gasoline blends with ethanol as reported by the Energy Information Administration.

Reflecting decreased supplies and tighter ending stocks, the forecast corn price for 2010/11 is raised 70 cents on the high end of the range and 50 cents on the low end of the range to $4.00-$4.80 per bushel. The 2009/10 season-average price received by farmers is expected to be $3.55 per bushel.

Sorghum Production Trimmed
Sorghum production is forecast at 376 million bushels for 2010/11, down 7 million bushels this month. Sorghum plantings and area to be harvested for grain for 2010/11 are unchanged this month but are down from last year. Based on September 1 conditions, sorghum yield is decreased 1.4 bushels per acre this month to 72.7 bushels per acre. In Kansas, the top producing State, producers are expecting a yield of 80 bushels per acre, down 2 bushels from last month and 8 bushels below the 2009 record yield. Producers in Texas, the second largest sorghum-producing State, expect the crop to yield 69 bushels per acre, down 1 bushel from last month but up 21 bushels from last year.

The decrease in production more than offsets the increase in beginning stocks, which are raised 3 million bushels to 31 million. Sorghum use for 2010/11 remains unchanged this month as decreased feed and residual use is offset by an increase in exports. Sorghum exports are forecast at 160 million bushels as global feed grain demand strengthens in 2010/11. Ending stocks for 2010/11 are projected at 37 million bushels, down 4 million from last month, reflecting changes in supplies.

 


In 2009/10, US sorghum exports are lowered 3 million bushels this month to 167 million based on trade data to date. This results in a 3-million-bushel increase in ending stocks to 31 million bushels.

For 2010/11, the projected sorghum farm price was raised 50 cents on the low end of the range and 60 cents on the high end of the range to $3.70-$4.40 per bushel, as tighter corn supplies strengthen feed grain prices. The season-average price for 2009/10 is expected at $3.20 per bushel.

Barley Unchanged, Oats Imports Down
Barley and oats production were not revised in the September Crop Production report. Any production revisions will be reported in the Small Grains 2010 Summary to be released 30 September 2010. No changes are made this month in barley supply and use. For oats, imports were lowered 10 million bushels to 80 million for the 2010/11 marketing year due to smaller oats production in Canada. This import reduction lowers total supply and ending stocks by 10 million bushels.

For the 2009/10 marketing year, season-average prices for barley and oats remain unchanged. The 2010/11 projected barley price was raised 15 cents on each end of the forecast range to $3.70-$4.30 per bushel. The 2010/11 projected oats price was lowered 5 cents on the high end of the range and raised 5 cents on the low end of the range to $2.20-$2.70 per bushel. Stronger corn prices for 2010/11 are expected to support other feed grain prices; however, a substantial portion of the 2010/11 oat crop has already been marketed at prices well below current levels.

World Coarse Grain Production Prospects Down 10 Million Tons
Global coarse grain production in 2010/11 is projected to be 1,097.7 million tons, down 10.3 million this month. While the largest decline is in the United States, foreign production is down 4.9 million tons, almost as much as in the United .States. The largest reductions in foreign production prospects are for the EU, down 3.5 million tons, and for Russia, reduced 1.2 million.

Foreign corn production prospects are down 0.3 million tons this month to 491.8 million. EU corn production prospects are reduced 1.2 million tons to 54.7 million. France and Germany forecast area and yields are lower, while Italy, Austria, Spain, and Greece face reduced yield prospects. These reductions more than offset improved prospects in Romania and some small producing countries. There is also a small reduction in corn production prospects this month for North Korea as excessive rains have trimmed both area and yield prospects. These declines are partly offset by increased prospects for Canada and Mexico, each up 0.5 million tons this month due to improved yields. In Canada, production prospects in Ontario are good as most areas have enjoyed favorable temperatures and precipitation. In Mexico, some areas along the Pacific coast have had flooding, but rains have been generally good and water supplies in reservoirs have been favorable for irrigation. There was also a significant revision for Brazil’s 2009/10 corn crop, up 1.8 million tons to a record 56.1 million as the safrina (second, dry-season) crop was bigger than expected.

Foreign barley production is forecast down 2.0 million tons this month to 121.9 million. The largest drop is in Russia, down 1.0 million tons to 9.0 million, as harvest reports indicate that the severe drought has cut both area and yields. In the EU, barley production is reduced 0.6 million tons to 54.2 million, as spring and summer dryness followed by excessive rains during harvest in Germany and Finland trimmed yields. Excessive rains also cut yield prospects in Belarus, reducing production 0.3 million tons to 1.6 million. Morocco, also with a much wetter-than-normal growing season, reported reduced barley yields, cutting production 0.2 million tons to 2.6 million. Statistics Canada reported reduced barley area, but more than offset that with improved yield prospects, increasing barley production prospects 0.1 million tons to 8.5 million.


World sorghum production prospects are down slightly due to the US reduction. Foreign production prospects are virtually unchanged at 54.5 million tons, with a small reduction in France lost in the rounding.

Foreign oats production is reduced 0.9 million tons this month to 20.4 million due to reductions for the EU, Canada, and Belarus. The EU is cut 0.4 million tons to 7.7 million mostly due to reduced yields in Finland and Germany. Canada reported sharply reduced area due to excessive rains during planting, cutting production prospects 0.4 million tons to 2.4 million. Belarus reported lower yields, trimming production 0.1 million tons to 0.7 million.

Foreign rye production is down 1.0 million tons this month to 12.6 million. The EU is reduced 0.8 million tons to 7.7 million, mostly due to reduced area and yield for Germany. Belarus rye is cut 0.2 million tons to 1.2 million due to lower yields. EU mixed grain production prospects are reduced 0.4 million tons this month to 14.7 million, mostly due to production problems in Germany. Russia’s millet yield is cut in half this month, reducing production prospects 0.2 million tons to 0.2 million.


Increased Beginning Stocks of Coarse Grain For 2010/11
Global coarse grain beginning stocks for 2010/11 are increased 1.5 million tons this month to 189.4 million. Much of the increase is for Brazil, with increased 2009/10 corn production boosting coarse grain stocks 1.3 million tons to 12.9 million. Other increases of note include China, up 0.3 million tons due to increased 2009/10 corn imports; Australia, up 0.3 million because of reduced exports and feed use of sorghum estimated for 2009/10; Canada, up 0.3 million based on the stocks report by Statistics Canada; and Ukraine, up 0.2 million due to lower corn exports estimated for 2009/10. These increases more than offset the decline for the United States and a 0.2-million-ton reduction for Argentina caused by increased sorghum exports for 2009/10.

Global Coarse Grain Use Decline Mostly in the United States
World coarse grain use is down 3.5 million tons this month to 1,120.3 million. However, most of the change is in the United States, with foreign use reduced 0.6 million tons to 818.9 million. Ukraine’s expected domestic use of corn in 2010/11 is reduced 0.5 million tons this month due to strong demand for exports. Belarus coarse grain use is cut 0.5 million tons because of lower production. Japan is trimmed 0.2 million tons due to animal disease problems. However, feed use of coarse grain in the EU is up 0.9 million tons this month because of reduced wheat production. Mexico’s corn feed use is boosted 0.3 million tons, with increased corn production. The increase in local marketing year world imports by 0.9 million tons more than the increase in global local marketing year exports cuts world disappearance by 0.9 million tons.

Drop in Projected World Stocks Mostly in the United States
Global coarse grain ending stocks in 2010/11 are projected down 5.3 million tons this month to 166.8 million. Foreign forecast stocks are reduced 0.1 million tons to 134.7 million, as increases and decreases mostly offset. EU coarse grain stocks are reduced 1.4 million tons this month and Belarus is down 0.3 million, both due to reduced production. Morocco is reduced 0.2 million tons for the same reason. Argentina’s ending stocks are reduced 0.2 million tons due to lower beginning stocks of sorghum. Brazil’s 2010/11 ending stocks are up 1.3 million tons this month because of increased 2009/10 corn production. China and Australia have higher projected 2010/11 coarse grain ending stocks, each up 0.3 million tons this month due to increased beginning stocks. Mexico’s ending stocks are up 0.2 million tons due to increased corn production. Changes for other countries are smaller.

World Corn Trade and US Exports Boosted This Month
Global corn trade forecast for 2010/11 (October-September) is increased 2.0 million tons this month to 93.4 million. The largest increase in projected imports is for the EU, up 2.0 million tons to 5.0 million. With reduced production of corn and other grains, the EU is expected to turn to additional corn imports, especially as internal prices result in a zero import duty. Russia’s corn imports are projected 0.7 million tons higher this month at 1.0 million to support meat production, as drought has reduced domestic grain production. These increases are partly offset by reduced corn import prospects for Canada, down 0.3 million tons to 2.2 million, due to increased domestic production; and for Japan, down 0.2 million tons to 16.1 million because animal disease problems are expected to trim feeding.

EU corn exports are projected at half the previous month’s forecast, down 0.5 million tons this month as tight grain supplies and strong internal prices are expected to discourage exports. Strong import demand and attractive prices for exports are expected to boost corn shipments by Brazil and Ukraine 0.5 million tons each. However, with strong early corn export sales, US 2010/11 corn exports are boosted 1.5 million tons this month to 53.5 million. Recent shipments leave the 2009/10 exports on a pace to reach the 50.0 million tons previously forecast.

US sorghum exports for 2010/11 are increased 0.2 million tons this month to 4.0 million. EU imports are increased to 0.2 million, with some reported purchases from Argentina.

For global barley trade, reduced export prospects for the EU and Russia are offset by increased barley export prospects for Canada. However, tight Canadian oats supplies are expected to limit exports, trimming US October-September oats imports projected for 2010/11 by 0.2 million tons to 1.4 million.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 27, 2010, 11:31:16 AM
Corn prices to remain high following poor Russian wheat harvest
[24 September 2010] The failure of the Russian wheat harvest will push corn prices as high as USD 6/bushel before the end of the year predicted Dr Paul Aho, an international consulting poultry economist, at the first meeting of the Arbor Acres Asia Association in Macau. Over 50 Arbor Acres breeders heard Dr Aho further predict that prices would ease a little in 2011 but never retreat to the levels of the early 2000s.


 
International seed giants expand in China
[24 September 2010] International seed industry giants, such as Pioneer Hi-Bred International, Inc. and Monsanto, are focusing heavily on the Chinese market. Pioneer Hi-Bred has already set up three seed breeding center in China's major corn production areas. One of its corn varieties has become one of China's major corn varieties in three years. In the first six months of this year, the seed sales of Pioneer Hi-Bred in China rose by 15%. Monsanto also operates three joint ventures, three fully-owned subsidiaries, and one research center in China's Mainland. Up to 10% of the company's revenues are used for R&D. 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 28, 2010, 08:59:17 AM
China to be net importer of corn
[28 September 2010] China will turn from a net exporter of corn to a net importer of the crop this year, said Fei Zhonghai, assistant to the general manager of the COFCO at the Fourth International Corn Industry Conference 2010 last week. China imported 600,000 metric tonnes of corn in January to August, and the ports are expected to see arrivals of 700,000 tonnes more, he said. The annual imports may come to 1.5 million tonnes in 2010, far higher than the country's exports, making China a net importer of corn, he added. An earlier report by the Ministry of Agriculture showed China exported 93,000 tonnes of corn in January to July, up 30.7%. It imported 282,000 tonnes of corn, a 56-fold surge.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on September 29, 2010, 10:18:22 AM
 Jim Sutter appointed as CEO of USSEC
[29 September 2010] Jim Sutter has been appointed CEO of the U.S. Soybean Export Council (USSEC). He will will lead USSEC’s efforts on behalf of U.S. soybean farmers to expand international markets for U.S. soybeans and soy products. Mr Sutter joins USSEC from Cargill, where he currently serves as Vice-President of Cargill’s Grain and Oilseed Supply Chain Business Unit.


 
US sbm exports to Southeast Asia escalate
[29 September 2010] US soybean meal exports to Southeast Asia jumped more than threefold to a record 2.4 million tonnes in the market year to September, according to the the American Soybean Association International Marketing (ASAIM). Driving the growth was growing imports from Vietnam that bought 500,000 tonnes in the year. For soybeans, the US shipped 2.3 million tonnes to Southeast Asia in the market year to August or a 27% increase year-on-year. Increase crushing in Thailand principally contributed to the rise in exports. 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 08, 2010, 09:20:59 AM
Soy prices continue upward trend
[8 October 2010] Soybean prices continue rising as demand for supply from the US grows. The US Department of Agriculture said that US exporters sold 225,000 tonnes to China, the world’s largest consumer. Global demand for soybean and soybean products continue to grow and China’s dependence on US supplies is driving the market up.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 13, 2010, 11:20:56 AM
NFA inaugrates third corn processing center
[12 October 2010] The Philippines National Food Authority's (NFA) third corn processing center commenced operations last week. The PHP 25.57 million corn processing center is in Echague, Isabela. The other two centers earlier established by the NFA are located in Wao, Lanao del Sur and in Alfonso Lista, Ifugao. The Agriculture department said that the corn processing center in Echague, Isabela is expected to benefit 6,000 corn farmers and traders. The center is capable of processing 150 metric tonnes of fresh corn on cobs per day. Isabela is among the top corn-producing provinces in the country, with average annual production of 15.01 million bags or 750,260 MT, the department said.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 13, 2010, 11:24:11 AM
Vietnam urged to launch campaign on GM crops
[12 October 2010] Reynaldo V. Ebora, director of the National Institute of Molecular Biology and Biotechnology at the University of the Philippines Los Banos College says that Vietnam should have a proper campaign to inform the public of the economic benefits of genetically modified (GM) crops and address concerns about this biotechnology,to clarify the science behind the technology.Mr Ebora said available analyses and scientific studies on food safety and proteins proved GM crops including corn were as safe for use as conventional products, and there had not been problems reported since the commercial introduction of agricultural biotech in 1996.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 15, 2010, 10:42:20 AM
Cargill nets 68% in profits
[14 October 2010] The world’s largest agricultural commodities trader Cargill recorded a 68% increase in net profits to USD 883 million in the first quarter ended August 31, from USD 525 million a year earlier, thanks to soaring grain prices. It said its trading and processing segment was the fastest-growing contributor to earnings.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 18, 2010, 09:30:26 AM
 USGC confirms adequate supply of US feed grains
[18 October 2010] The U.S. Department of Agriculture recently released its World Agricultural Supply and Demand Estimates (WASDE) reflecting the third-largest corn crop and yield on record. While this month’s report lowers U.S. corn yield and production estimates from the previous month, U.S. Grains Council President and CEO Thomas C. Dorr said these market challenges will be addressed. “U.S. farmers have always responded to market signals and have been able to produce an adequate supply to meet market demand. The US is a reliable, long-term supplier of coarse grains and co-products,” said Mr Dorr. In 2008, the United States produced 12.1 billion bushels of corn with an average yield of 153.9 bushels per acre. USDA forecasts 12.7 billion bushels with an average yield of 155.8 bushels per acre.
 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 21, 2010, 10:03:41 AM
US Feed Outlook - October 2010
Corn planted and harvested area are both increased this month, but a 6.7-bushel-per-acre decrease in yield lowers forecast corn production 496 million bushels. Production also is decreased for sorghum, barley, and oats, according to the USDA's Economic Research Service (ERS).

 

Corn feed and residual use is raised because of a slight rise in grain-consuming animal units and earlier-than-usual harvesting before the start of the crop year. US corn exports are reduced mostly due to higher prices and competition from Argentina. World coarse grain production is reduced this month and use is increased, leaving global stocks slightly lower. Corn, sorghum and barley prices are increased this month but the projected range for oats is unchanged.

 
Domestic Outlook

Feed Grain Production Down Sharply in 2010/11
US feed grain production for 2010/11 is forecast at 335.4 million tons, down from 349.1 million last month. The month-to-month decrease reflects reduced forecast production for corn and sorghum and smaller production estimates for barley and oats from the Small Grains 2010 Summary report. Planted area for the four grains is decreased 400,000 acres this month, and acres harvested for grain were decreased 300,000 acres. Yields per harvested acre for the four grains combined are decreased to 3.74 metric tons per acre, compared with 3.88 metric tons last month. Beginning stocks in 2010/11 are raised to 48.1 million tons, based on the September 30 Grain Stocks report. Total 2010/11 feed grain supply is forecast at 385.5 million tons, down from 390.7 million last month and 398.3 million in 2009/10.

Total 2010/11 feed grain utilisation is projected at 359.0 million tons, up from 358.7 million last month and 350.2 million in 2009/10. The month-to-month increase is mostly from higher corn feed and residual use but is partly offset by lower corn exports and lower sorghum domestic use. Total projected feed grain ending stocks for 2010/11 are lowered 5.5 million tons to 26.5 million, mainly reflecting tight corn supplies.

Feed Use
On a September-August marketing year basis for 2010/11, feed and residual use for the four feed grains plus wheat is projected to total 147.26 million tons, up 5.29 million from the revised total of 141.97 million tons in 2009/10. Corn is estimated to account for 93 per cent of feed and residual use in 2010/11, up from 92 per cent in 2009/10.

 
The projected index of grain-consuming animal units (GCAU) in 2010/11 is 92.1 million units, up from the revised 91.5 million in 2009/10. Feed and residual per GCAU in 2010/11 is estimated at 1.60 tons, up from 1.55 in 2009/10. In the index components, GCAUs are increased for dairy, pork and poultry but decreased for beef.

With higher prices forecast for feed grains this month, most of the 2011 production forecasts for meat, milk and eggs are reduced. However, feed and residual use for 2010/11 is increased this month because it is calculated as the residual and about twice as much corn as usual was harvested before the 1 September start of the marketing year. September 1 corn stocks (2009/10 ending stocks) are reported for ‘old crop’ (harvested in 2009) stocks by respondents to the NASS survey. ‘New crop’ (harvested in 2010) corn harvested and used before the start of the marketing year is expected to show up as residual usage during the first quarter of the new marketing year. Early new-crop usage showed up as higher first quarter feed and residual use in the September-November quarter of 2007/08, the last time the corn harvest was early.

USDA’s September 17 Milk Production report indicated milk production in the 23 majors states during August totalled 15 billion pounds, up 2.8 per cent from August 2009. Production per cow averaged 1,796 pounds for August, 51 pounds above last year. However, the number of milk cows on farms declined by 10,000 head from August 2009 to 8.36 million. Milk production for 2010 is raised slightly from last month as higher milk per cow more than offsets lower cow numbers. The forecast for 2011 is reduced as higher feed prices are expected to slow the rate of growth in cow numbers and milk per cow compared with last month; with lower milk production, feed needs would be reduced.

US hog breeding inventory on the third quarter of 2010 was at 5.77 million head, down two per cent from last year and down slightly from the previous quarter according to USDA’s September 24 Quarterly Hogs and Pigs report. Market hogs inventory, at 59.2 million head, was also down three per cent from last year. As the result of lower market inventory, lower slaughter and slower growth in slaughter weights, 2010 pork production forecast is reduced. Intended farrowings from December 2010 to February 2011, at 2.89 million sows, are up slightly from the same period a year earlier but down four per cent from the period December 2008 to February 2009 based on the report. Pork production for 2011 is lowered from last month as relatively high feed prices are expected to keep the growth in sows farrowing modest and dampen hog weights requiring slightly less feed.

USDA’s Broiler Hatchery report on 6 October indicated that broiler-type eggs sets and chicks placed have been increasing. Cumulative placements of broiler flock are up from the same period a year earlier. For these reasons, the broiler production projection is increased for the last quarter of 2010 but reduced for 2011 as producers are expected to respond to rising feed prices, slowing the expansion and reducing feed use relative to last month’s forecast.

Egg-type chicks hatched and pullet chicks for future hatchery supply have been decreasing based on USDA’s September 21 Chickens and Eggs report. Rising feed prices are also expected to reduce egg production for 2011. If realised, lower production would weaken feed use by the egg industry.

USDA’s September 15 Turkey Hatchery report indicated that during August 2010, turkey poults hatched were down two per cent from a year earlier but net poults placed were 80,000 above August 2009. Turkey production projection for 2010 remains the same as that of last month but the turkey meat forecast for 2011 is lowered from last month as higher feed prices slow growth and weaken feed needs.

USDA’s September 17 Cattle on Feed report indicated placements and marketings of feed cattle during August both increased seven per cent above 2009. Beef production forecasts for 2010 are raised as second half production is higher than previously expected. The 2011 beef production forecast is also raised primarily in the first quarter as larger-than-expected third quarter 2010 placements are marketed. Thus, feed needs by the cattle feeding industry are expected to remain strong but will partly be met by plentiful supplies of spent distillers’ grains.

Minor Changes Made to 2009/10 Crop Year
The following changes are made to the 2009/10 balance sheets:

Corn: feed and residual use is lowered 358 million bushels to 5,167 million this month based on 1 September stocks; food, seed and industrial (FSI) use is raised 30 million bushels, reflecting an increase of 25 million bushels for corn used for ethanol and small increases in other FSI uses; exports are raised seven million bushels to 1,987 million bushels based on trade data; ending stocks are raised 322 million bushels, to 1,708 million bushels, based on the 1 September stocks estimate.

Sorghum: FSI use is lowered 10 million bushels to 90 million due to tighter supplies; exports are also lowered one million bushels to 166 million based on trade data; ending stocks are raised 10 million bushels to 41 million based on the 1 September stocks estimate; and the farm price per bushel was raised from $3.20 to $3.22.

Barley: feed and residual use was lowered slightly, which lowered total use one million bushels to 217 million.

Oats: no changes were made.

Corn Crop Down Sharply in 2010/11
Corn production is forecast at 12,664 million bushels for 2010/11, down 496 million from last month. The forecast was lowered because of lower expected yield, down 6.7 bushels per acre from last month to 155.8 per acre. As forecast, this year’s production would be the third highest on record behind 2009 and 2007. Based on administrative data, 2010/11 planted area is raised 350,000 acres to 88.2 million and area harvested is up 258,000 acres to 81.3 million. Beginning stocks are raised to 1,708 million bushels, up 322 million from last month. Larger-than-expected carryout of old-crop corn, combined with an unusually early start to this year’s harvesting, suggests heavy new crop corn use before the 1 September beginning of the 2010/11 marketing year. Individual state harvest progress reports suggest that 600 to 700 million bushels of corn were harvested across the South, Southern Plains and southern Corn Belt before 1 September. This is double the level of the last two years and similar to what happened between the 2006/07 and 2007/08 marketing years. New crop corn usage ahead of 1 September 2007 lowered feed and residual disappearance during the June-August quarter of 2006/07 and boosted feed and residual disappearance during the September-November quarter of 2007/08.

 


 
The 1 October corn objective yield data indicate the second highest number of ears per acre on record for the combined 10 objective yield States (Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin), behind only the record year of 2009. Record high ear counts are forecast in Iowa, Ohio and Wisconsin.

Feed and residual use is raised 150 million bushels to 5,400 million, reflecting the expected impact of new crop corn usage before 1 September on indicated disappearance during the current marketing year. Exports are lowered 100 million bushels to 2,000 million as a result of smaller supplies, higher prices and increased export competition from Argentina. Corn used for ethanol production in 2010/11 was unchanged this month at 4,700 million bushels, even though ethanol production in July (latest numbers available) was 1,116 million gallons, a new record. Corn used for high-fructose corn syrup (HFCS) was decreased 10 million bushels this month due to weak domestic demand. Total utilization is projected at a record 13,480 million bushels, up 40 million from last month and 396 million from 2009/10.

Ending stocks are lowered sharply this month by 214 million bushels. At a projected 902 million bushels, 2010/11 ending stocks would be the lowest since 1996/97. Projected stocks drop to less than 24 days of expected use. Tight supplies and strong demand boost expected corn prices 60 cents on both ends of the range to $4.60 to $5.40 per bushel, compared with $3.55 per bushel for 2009/10.

Sorghum Production Cut
Production is forecast at 337 million bushels, down 39 million bushels from last month and 46 million from last year. Based on updated administrative information, acreage changes were made in several states. Planted area is estimated at 5.4 million acres, down 598,000 acres from the previous forecast and 1.2 million from 2009. Planted acreage for 2010 is the lowest on record. Harvested area is forecast at 4.7 million acres, down 518,000 acres from the previous forecast and 862,000 acres from last year. If realised, this will be the lowest harvested acreage on record since 1936. Based on 1 October conditions, yield is forecast at 72.4 bushels per acre, down 0.3 bushels from September but up 3.0 bushels from last year. Record high yields are forecast in Louisiana and Texas. With a 10-million bushel increase in beginning stocks, total supply for 2010/11 is projected at 378 million bushels, down 29 million from last month, reflecting decreased production.

Projected total utilisation is 340 million bushels, down 30 million bushels from last month and 56 million from 2009/10. Feed and residual use is expected to be 20 million bushels lower this month and FSI use is expected to be 10 million bushels lower than last month, as strong prices and export demand limit sorghum feeding and processing use. Exports remain unchanged this month and are expected to total 160 million bushels, down from 166 million in 2009/10. Ending stocks for 2010/11 were raised one million bushels this month to 38 million.

The expected sorghum season average price was increased $1.10 on the low end of the range and $1.20 on the high end of the range to $4.80 to $5.60 per bushel, compared with $3.22 per bushel for 2009/10. This sharp increase in expected price reflects the smaller corn and sorghum crops, while export demand remains strong.

 


 
Barley Crop Forecast at 182 Million Bushels
Barley production for 2010/11 is forecast at 182 million bushels, down 2 million from August and 45 million from 2009/10. Average yield per acre, at 73.6 bushels, is up 1.3 bushels from last month and 73 bushels from last year. Area harvested for grain is estimated at 2.5 million acres, unchanged from last month and down 642,000 from 2009/10. Total supply of barley is projected at 312 million bushels, down 2 million from last month and 21 million from 2009/10. Imports were unchanged from last month’s projection of 15 million bushels.

 


 
Projected barley use was unchanged from last month. Ending stocks for 2010/11 were lowered by two million bushels to 87 million and are down 28 million from last year. Barley prices were increased by 10 cents on both the high and low ends of the range to $3.80 to $4.40 per bushel, compared with $4.66 in 2009/10.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on October 21, 2010, 10:05:19 AM
Oats Production at Record Lows
Production of oats for 2010/11 is estimated at a record low 82 million bushels, down five million from last month and 11 million from 2009/10. The estimated yield was lowered 1.7 bushels per acre from last month to 64.6 bushels. Compared with last year, yields were down 2.9 bushels per acre. Area planted to oats is estimated at 3.1 million acres, down slightly from last month and down 266,000 acres from 2009/10. The largest decline occurred in North Dakota, where planted area decreased 70,000 acres from last year and is a record low for that state. Harvested area is estimated at 1.3 million acres, down slightly from last month and down 111,000 acres from last year, making it the smallest acreage harvested for grain on record.

Total supply is forecast at 242 million bushels, down six million from last month. Ending stocks were lowered by six million bushels this month to 48 million, down 32 million from 2009/10. Prices for 2010/11 are unchanged this month at $2.20 to $2.70 per bushel, compared with $2.02 last year.


 


 
Hay Production up in 2010/11
All-hay production in 2010 is forecast at 152.3 million tons, up from 147.4 million in 2009. This increase stems partly from a 3.2 per cent rise year-to-year in yield at 2.55 tons per acre. Total hay harvested area for 2010/11 decreased slightly to 59.7 million acres from 59.8 million last year. Roughage-consuming animal units (RCAU) in 2010/11 are projected to be 69.5 million units, down from 70.2 million in 2009/10. With hay production up and RCAUs down, hay supply per RCAU is 2.49 tons in 2010/11, compared with 2.41 tons in 2009/10.

Production of alfalfa hay and alfalfa mixtures is forecast at 71.3 million tons, down two per cent from the August forecast but up slightly from last year. Based on 1 October conditions, yields are expected to average 3.44 tons per acre, down 0.05 tons from August but up 0.09 ton from 2009. Harvested area is forecast at 20.7 million acres, unchanged from August but down two per cent from the previous year's acreage.

Other hay production is forecast at 81 million tons, down one per cent from the August forecast but up six per cent from 2009. If realised, this will be the third highest production level on record. Based on 1 October conditions, yields are expected to average 2.08 tons, down 0.01 tons from the August forecast but up 0.10 tons from last year. If realised, this will be a record-high yield, surpassing the 2.06 tons per acre in 2004. Harvested area, at 38.9 million acres, is unchanged from August but up one per cent from the previous year.

 
International Outlook

Foreign Coarse Grain Production Prospects Increased This Month
World coarse grain production in 2010/11 is projected down 8.9 million tons to 1,088.8 million because of the large US cut. However, foreign coarse grain production changes this month are partly offsetting, up 4.8 million tons to 753.2 million. Foreign corn production is up 6.2 million tons to 498.0 million boosted by increases for Argentina and Sub-Saharan Africa. Foreign barley production prospects continue to deteriorate, down 1.3 million tons to 120.6 million. Global barley production is projected to be the lowest since 1970/71. World oats production is down slightly this month to 21.5 million, the lowest in USDA’s history back to 1960. Generally, poorer returns than those for alternative crops have limited barley and oats area planted, and unfavorable weather across much of Europe limited yields.

Argentina’s corn production is forecast up 4.0 million tons this month to 25.0 million. In recent weeks, excellent rains across western corn areas such as Cordoba have complemented earlier good rains to the east. This has facilitated timely corn planting in contrast to previous years when dryness delayed seeding. Recent increases in corn prices have encouraged seeding, as have relatively ample export quotas for the previous crop. Moreover, many producers are feeling the negative effects of continuous soybeans on yield and soil productivity, and they are attracted to corn to provide a crop rotation. Projected harvested area is up 19 per cent this month to 3.2 million hectares. The forecast yield is nearly unchanged this month but is down six per cent from the previous year’s record.

 
Corn production in Sub-Saharan Africa is up 2.1 million tons this month to 54.2 million. Rainfall across most of the region has been favourable and crop reports support increases in many countries. The largest increase is for Zambia, up 0.8 million tons to 2.8 million with increased area and very good yields. Malawi and Mozambique are each increased 0.4 million tons, with good yields pushing the increase in Malawi and increased reported area the main factor in Mozambique. There are smaller increases this month for Angola, Rwanda, Madagascar, Congo, Uganda, Somalia, Lesotho, Botswana and Swaziland. These increases overwhelm reductions for Benin, Burkina-Faso and Sierra Leone.

Serbia’s corn prospects are increased 0.3 million tons to 6.8 million due to good reported yields. EU corn production is up 0.25 million tons to 55.00 million as increased prospects for Romania, Bulgaria and France more than offset reduced prospects for Hungary and Spain. Russia’s corn production prospects are cut 0.5 million tons to 3.0 million as harvest reports indicate hot dry temperatures during grain fill reduced yields more than previously anticipated.

EU barley production is forecast down 0.7 million tons this month to 53.6 million. Spain, with barley harvest completed months ago, reported lower area and yields, reducing production 0.4 million tons to 8.3 million. There are smaller reductions this month for Poland, the Czech Republic and Hungary. Russia’s barley production is reduced 0.5 million tons to 8.5 million as harvest reports confirm large yield losses due to drought. Statistics Canada reported slightly reduced area and yield for barley, trimming production prospects 0.25 million tons to 8.25 million. There is also a 0.1 million-ton increase in barley production for Algeria based on reported yields.

 
Oat production is reduced slightly this month for Canada, the United States and Spain, leaving global production at record-low levels. Foreign sorghum production is up slightly this month due to a 0.2-million-ton increase for Sub-Saharan Africa, but that is more than offset by reduced US prospects, leaving projected global production down 0.8 million tons this month to 63.3 million.

Increased beginning stocks, especially of US corn, are partly offsetting reduced production of world coarse grains in 2010/11. Global coarse grain beginning stocks of 198.8 million tons are the largest in eight years. Foreign coarse grain beginning stocks are up 1.0 million tons this month to 150.6 million. EU coarse grain beginning stocks are up 0.6 million tons to 23.8 million, mostly due to increased corn imports in late 2009/10 and reduced 2009/10 local marketing year barley exports. Iran’s beginning stocks are up 0.5 million tons this month due to strong corn imports at the end of 2009/10. Consumption revisions for 2009/10 for Canada and import revisions for Brazil, Colombia and Venezuela boosted 2010/11 corn beginning stocks 0.2 million tons each. There are smaller increases this month for Lebanon, Cameroon, Senegal, Kenya and Azerbaijan. These more than offset reduced stocks for Paraguay and Argentina, each down 0.3 million tons due to strong 2009/10 corn exports. There are also small reductions for several other countries.

Global Coarse Grain Consumption up, Ending Stocks Reduced
World coarse grain consumption in 2010/11 is forecast up 3.9 million tons this month to 1,124.2 million. Most of the increase is for the United States, with foreign consumption up 1.1 million tons to 820.0 million. With increased production, consumption in Sub-Saharan Africa is increased 0.9 million tons to 99.1 million. Declines in Burkina-Faso and Benin are more than offset by numerous increases in other countries. Increased supplies support increased feed use of 0.3 million tons each in Turkey and Venezuela; 0.2 million tons each in Colombia, Iran, Indonesia, Serbia and South Korea; and smaller amounts for Lebanon, Morocco and Azerbaijan.

EU coarse grain use is down 1.2 million tons this month to 151.9 million mostly due to reduced production and feed use of barley and reduced imports and feed use of corn. Russia’s coarse grain use is reduced 0.8 million tons this month to 21.7 million. Reduced corn and barley production is only partly offset by increased barley imports and despite policies to support meat production, coarse grain feed use is expected to decline more year-to-year than increases in wheat feeding. Canada’s coarse grain use is reduced 0.7 million tons this month to 22.5 million. Feed use is trimmed 0.2 million tons and corn food and industrial use is cut 0.4 million tons to 4.3 million. Coarse grain consumption for Argentina is lowered 0.5 million tons this month with lower expected corn feeding. There is also a small reduction in forecast use for Uruguay caused by increased corn export prospects.

World coarse grain ending stocks projected for 2010/11 are down this month due to the large drop in US corn stocks. Foreign coarse grain stocks are forecast up 2.1 million tons to 136.9 million, with increased corn stocks more than offsetting a small decline for barley. World corn ending stocks for 2010/11, projected at 132.4 million tons, are larger than in six of the previous 10 years.

Corn ending stocks in Sub-Saharan Africa are projected up 0.8 million tons this month to 9.8 million, boosted by increased production in many countries. Increased production is also supporting higher corn stocks prospects in Argentina, up 0.7 million tons, and in the EU, up 0.6 million. Strong imports in 2009/10 and increased beginning stocks for 2010/11 are supporting corn ending stocks prospects for Iran, up 0.3 million tons; and for Brazil, Canada and Colombia, each up 0.2 million. Serbia’s corn stocks are up slightly due to increased production. Increased corn export prospects are trimming corn ending stock prospects in Paraguay, Mexico and Uruguay; while strong demand is expected to reduce corn stocks in Venezuela.

US Corn Export Prospects Cut Due to Reduced Supplies
US corn export prospects for 20010/11 (October-September) are reduced 2.0 million tons to 51.5 million (the local marketing year is cut 100 million bushels to 2.0 billion bushels). This is still up three per cent from the 50.0 million estimated for 2009/10. As of 30 September 2010, outstanding export sales reached 13.8 million tons, up 23 per cent from a year earlier. However, increasing US prices and increased competition, especially from Argentina, is expected to limit future US corn sales.

Increased corn exports are expected from Argentina, up 1.5 million tons to 15.0 million based on sharply increased production prospects. Paraguay’s export prospects are up 0.3 million tons this month as strong export demand will limit their stocks’ increase. Zambia’s corn exports are up 0.2 million tons. A large crop is expected to encourage exports to nearby markets. Mexico’s 2010/11 corn exports are boosted 0.2 million tons based on the strong exports for 2009/10. Uruguay’s corn export prospects are nudged up for the same reason.

 
World corn trade for 2010/11 is increased slightly this month to 93.6 million tons. Turkey’s corn imports are up 0.3 million tons to 0.7 million to support poultry production. Meat production supports corn import increases of 0.2 million each for Colombia, Indonesia and South Korea. Lebanon’s corn import prospects are increased slightly. Mostly offsetting these corn import increases is a reduction of 0.5 million tons for the EU, where meat production is expected to decline in 2011; and a reduction of 0.4 million tons for Canada, with less industrial use expected.

Global barley trade is up slightly this month to 16.2 million tons with a 0.2-million ton increase in imports by Russia and exports by the EU. Despite tight grain supplies, the EU is expected to respond to strong foreign demand and boost exports. World sorghum trade for 2010/11 is unchanged this month. US sorghum exports are unchanged this month at 4.0 million tons as foreign customers are expected to bid sorghum away from the domestic market.


Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 02, 2010, 07:35:25 AM
Another corn facility to rise in Isabela
[1 November 2010] The Philippine government has scored a grant from South Korea that will be used in part to build another corn facility in Isabela Province, one of the main corn production areas in the Philippines. The USD 790,000 grant will be used to construct a new corn processing centre, two multi-purpose warehouses that will serve as machinery shed and grain storage, and a community centre for trainings and other project related activities. Earlier in October, the Philippines inaugurated a USD 11.6 million corn processing centre in Isabela that can process 200,000 tonnes of corn. The site for the new project has yet to be identified, however, a pilot area covering three hectares will be used for it.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 02, 2010, 07:36:24 AM
IGC predicts tightening of world grains markets
[2 November 2010] The International Grain Council has said that world grains markets are expected to tighten in the 2010-11 season as consumption outpaces supply for the first time in four years. While wheat production is expected to hit 644 million metric tonnes, worsening prospects for corn crops in the U.S. and China are expected to lower world production. The IGC cut its estimates for 2010-11 world corn output to 814 million tonnes from a previous forecast of 824 million tonnes. Corn output from the U.S., is expected to total 323 million tonnes this season, said the IGC, cutting its previous forecast by 11 million tonnes. China is expected to produce 162 million tons this year, 3 million less than the IGC's September estimate.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 04, 2010, 07:34:53 AM
 Indian SBM export increases 83% in October
[3 November 2010] Soybean-meal exports from India could jump 83% in October as farmers boost sales to benefit from prices set for a fourth straight monthly gain, according to the Soybean Processors Association of India. Association's coordinator Rajesh Agrawal said sales to Japan, South Korea, Vietnam, Thailand and China may total 400,000 tonnes in October, compared with 218,247 tonnes a year earlier. He said India’s soybean-meal exports may jump to 3.5 million tonnes in the year that began October 1, from 2.35 million tonnes last year. 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 05, 2010, 08:40:45 AM
CME: Feed Market to Start Focusing on Demand
US - Feed prices remain a hot topic in the livestock complex and we should get some additional information from USDA when it updates its supply and demand estimates on 9 November, write Steve Meyer and Len Steiner.



At this time the market still does not have a firm grasp of the total supply coming from this year’s harvest. There is some expectation that USDA will further lower its yield estimate. Harvest has been relatively good in some of the northern states and it remains to be seen if that will be sufficient to offset the disappointing results of the harvest in other states. We will provide a more complete update on this once we receive the regular analyst survey prior to the report.

As the supply questions are settled, the market will start to focus more intently on the demand side in the grain complex. According to the latest USDA report (which will be updated next week), the total US corn supply for the marketing year which started on 1 September was estimated at 14.382 billion bushels. Of this supply, 1.708 billion bushels was inherited from last year and 12.664 billion bushels was expected to come from this year’s harvest. Those numbers are still up in the air but should become clearer next week.

The US ethanol industry is estimated to use about 4.7 billion bushels of corn, or 33 per cent of the available supply for this marketing year, another 10 per cent or 1.380 billion bushels is expected to go for industrial uses and seed, while exports are expected to take 2 billion bushels or 14 per cent. The remainder of the available supply is expected to go into animal feed and residual, which is one word moniker for ‘we know it got used up but don’t know where it went.’ All of these demand issues will be closely observed.

One issue that has gained prominence in recent days is the outlook for US grain exports in light of a weaker US currency. Through the first eight months of the year, almost half of all US corn exports went to Japan, S. Korea and Taiwan. The Japanese yen has been steadily appreciating against the US currency since June. This means that while US nearby corn futures have appreciated by almost 65 per cent since 1 June, in Japanese Yen terms, prices have appreciated only 45 per cent, a difference that provides Japanese buyers an edge vs. their US counterparts.


Corn prices are expected to remain high through next year and this should ration some of the export demand. But a weaker US currency will blunt some of the impact of the higher US prices. No one really knows how weak the US currency will get now that the FED has decided to crank the printing presses. What is known is that a weak dollar will be one more factor fueling inflation in feed and eventually livestock prices.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 11, 2010, 09:22:53 AM
Indian corn consumption up 30% by 2015
[11 November 2010] Corn consumption in India is expected to grow 30% to 22.4 million tonnes by 2015 mainly driven by increasing demand for feed from the livestock sector as rising incomes allow Indian consumers to eat more meat. Rice production grows to 51% to 132 million tonnes by 2014/2015. This increase will come from increased domestic demand as India’s population continues to swell, as well as better access to pesticides and fertilizers, which will improve crop yields, noted the country’s agribusiness report.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 12, 2010, 12:02:59 PM
 Monsanto tries to grow new corn in China
[12 November 2010] US-based multinational agricultural biotechnology company Monsanto said this week that it will trial growing a new species of corn in Jilin Province, a major maize growing production area in northeast China. The new corn species is high-yielding and pest-resistant, and its comparative advantage is quality rather than cost, according to Kevin Eblen, Monsanto's regional leader for North Asia, who was optimistic that the new corn species would appear on the local market of Jilin within two years. Monsanto's sales in China in 2009 totaled USD 11.7 billion. 
 
 
 
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 15, 2010, 10:35:02 AM
Feed Outlook - November 2010
Lower yields have reduced the US corn crop but it is still predicted to be the third largest ever, according to Allen Baker, Edward Allen, Heather Lutman and Yonas Hamda in the latest report from the USDA Economic Research Service.

 

Lower forecast corn yields this month reduce US corn production 124 million bushels to 12.54 billion. Fractional changes are made in sorghum, barley, and oats because of late harvests. Corn used for ethanol production is raised. Corn used domestically for feed and residual and for export are both lowered. These supply and use changes reduce projected ending stocks 75 million bushels. As projected, 2010/11 ending stocks would be the lowest since 1995/96 and represent a carry-out of 6.2 per cent of projected usage. Price prospects for corn and sorghum are up this month. Foreign corn production is projected higher, with increased corn production in China. Rising foreign consumption combines with the smaller US crop to leave global corn stocks at a four-year low.


DOMESTIC OUTLOOK

Feed Grain Production Prospects Lowered in 2010/11
US feed grain production for 2010/11 is forecast at 332.2 million metric tons, down from 335.4 million last month and down from 349 million in 2009/10. The month-to-month decrease results mostly from lower forecast corn production. Downward revisions for barley and oats production and a small increase for sorghum are all very small. There are no changes in imports, therefore, total supply is decreased about the same amount as production.

Total 2010/11 feed grain utilization is projected at 357.7 million tons, down from 359.0 million last month but up from 350.2 million in 2009/10. Feed and residual use was lowered 2.5 million tons this month to 139.9 million tons. Food, seed and industrial (FSI) use increased 2.5 million tons this month to 164 million because of increased ethanol production. Exports are lowered this month to 53.9 million tons from 55.1 million last month and down from 54.8 million in 2009/10 as a result of lowered corn exports. Forecast feed grain ending stocks are decreased this month to 24.6 million tons, down from 26.5 million last month. Price prospects for corn and sorghum are up this month for 2010/11.

Minor changes were made for the 2009/10 marketing year for feed grains as a result of final ethanol production numbers and exports, which raised corn FSI use but lowered exports and resulted in lower corn feed and residual use. Total feed grain feed and residual use decreased 193,000 tons, to 137.6 million for 2009/10.

Feed Use
On a September-August marketing year basis for 2010/11, feed and residual use for the four feed grains plus wheat is projected to total 144.95 million tons, up 3.4 million from the adjusted total of 141.55 million tons in 2009/10. Corn is estimated to account for 93 per cent of feed and residual use in 2010/11, the same as in 2009/10.

The projected index of grain-consuming animal units (GCAU) in 2010/11 is 92.3 million units, up from the adjusted unit of 91.6 million in 2009/10. Feed and residual per GCAU in 2010/11 is estimated at 1.57 tons, up from 1.54 tons in 2009/10. In the index components, GCAUs are increased this month for cattle on feed and broilers.

Despite higher prices forecast for feed grains this month, total US meat production is raised for 2010 and 2011. Egg production was reduced slightly for 2010 and unchanged for 2011, and milk production was unchanged for 2010 and reduced slightly for 2011.

Beef production is raised largely due to a higher-than-expected number of cattle placed on feed lots during the third quarter of 2010. USDA's 22 October Cattle on Feed report indicated placement numbers up eight per cent in September from last month and three per cent above 2009. In addition, the total inventory of cattle and calves on feed for slaughter market in October was up six per cent from last month and three per cent from 2009. In the trade side, export of beef is raised in 2010 and 2011 on stronger growth to Asian markets. Continued strong demand for cattle in 2010 and 2011 is expected to result in higher demand of feed despite higher grain prices.

Pork production is raised largely due to exceptional gains in carcass weights. USDA's 22 October Livestock Slaughter report indicated federally inspected average dressed weight of hogs at 202 pounds in September, up one per cent from the month before but the same as last year. Pork production is forecast higher in early 2011, as some of the weight gains seen in late 2010 are expected to carry into 2011. Feed use demand is expected to remain strong for the remainder of 2010, but higher feed costs are anticipated to moderate the increase in carcass weights by mid-2011 and lower exports.

Forecast milk production for 2010 is unchanged from last month. However, 2011 production is lowered from last month as forecast cow numbers are reduced from last month. Milk per cow is adjusted slightly higher in early 2011. This forecast is supported as historical trends show a decline in the number of milk cows and an increase in productivity per cow. On the trade side, exports in 2010 and 2011 are forecast higher due to continued global economic recovery and favorable exchange rates. Nevertheless, higher feed prices and lower forecast milk prices are expected to limit the rate of growth and the amount of feed use, especially in 2011.

Broiler hatchery data from USDA's 3 November Broiler Hatchery report points toward continued gains in broiler production as the number of broiler-type eggs set is up eight per cent and broiler-type chicks placed is up five per cent from the comparable week a year earlier. Moreover, based on USDA's 25 October Poultry Slaughter report, broiler production is up one per cent from last month and up five per cent from last year, which led to higher production forecast in 2010 and 2011. Higher than expected feed costs are expected to slow the rate of expansion and feed use of the broiler sector later in 2011.

USDA's 22 October Chickens and Eggs report showed pullets added to the layers on hand flock in the month of August was down 11 per cent from last year but pullets on hand on 1 September were up one per cent from last year. As a result, the egg production forecast is lowered this month for 2010 but unchanged for 2011. Egg prices for 2010 are forecast higher as prices recovered from their late summer decline but the 2011 forecast is unchanged. With reduced egg production and rising feed costs, feed use is expected to be lower.

USDA's 15 October Turkey Hatchery report indicated that eggs in incubators on 1 October were down four per cent from a month ago. In addition, turkey poults hatched and net poults placed during September were down four per cent each from a month ago. The Poultry Slaughter report also showed a three-per-cent decline in total turkey live weight. The rate of decline in 2010 turkey production is slower than last month's forecast, while 2011 production forecast is unchanged. With declining eggs in incubators, poults hatched and placed, and rising feed costs, producers are expected to slow down feed use.

Minor Changes Made to 2009/10 Marketing Year
Corn FSI use is raised 8.2 million bushels this month, as corn used for ethanol is raised by the same amount. This change is based on ethanol production data from the US Energy Information Administration. Corn exports were also lowered based on trade data from the Bureau of Census for August. As a result of these adjustments, feed and residual use is lowered 7.5 million bushels to 5,159 million bushels for 2009/10.






2010/11 Corn Crop Forecast Lowered
US corn production is forecast at 12.540 billion bushels, down 124 million from last month but still the third largest on record. Based on conditions as of 1 November, yields are expected to average 154.3 bushels per acre, down 1.5 bushels from last month and 10.4 bushels below last year.

Despite the drop from October, this yield, if realized, would be the third highest on record. Beginning stocks and imports are unchanged this month, resulting in projected total supply of 14.257 billion bushels, down from last month's 14.382 billion. The 1 November corn objective yield data indicate the second highest number of ears per acre for the combined 10 objective yield states (Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin), behind the record year of 2009. Record-high ear counts are forecast in Iowa, Ohio and Wisconsin.

Favourable weather conditions during the month of October led to the rapid harvesting of this year's corn crop. As of 31 October, 91 per cent of the corn acreage was harvested, 67 percentage points ahead of last year and 30 percentage points ahead of the five-year average. Harvest was ahead of the normal pace in all 18 major producing states, with Illinois, Indiana and Kansas all having less than five per cent of the crop remaining in the field. Harvest was complete in Kentucky, North Carolina and Tennessee by month's end.

Feed and residual use is projected 100 million bushels lower with the smaller forecast crop and higher prices expected to reduce feeding. Exports are lowered 50 million bushels as higher prices trim export demand. Corn use for ethanol is raised 100 million bushels with record October ethanol production indicated by weekly Energy Information Administration data and favorable ethanol producer margins. Ethanol prices continue to track higher with corn prices, supporting returns for ethanol producers. Although small relative to domestic usage, higher ethanol exports and lower imports are also expected to add to corn use for ethanol, with high sugar prices limiting the availability of ethanol from Brazil.

Corn ending stocks for 2010/11 are projected 75 million bushels lower. At 827 million bushels, ending stocks would be the lowest since 1995/96 and represent a carryout of 6.2 per cent of projected usage. In 1995/96, carry-out dropped to five per cent of estimated usage. Lower projected ending stocks and strength in futures prices raise prospects for 2010/11 prices received by farmers. The projected season-average price is raised 20 cents on both ends of the range to $4.80 to $5.60 per bushel, compared with $3.55 in 2009/10. Since many farmers likely forward priced some of their crop before prices rose sharply this fall, prices received by farmers are expected to remain below cash prices.

Sorghum Price Prospects Raised in 2010/11
Sorghum production increased slightly this month, raising total supply 390,000 bushels from last month to 378.9 million for 2010/11. This increase resulted in a corresponding increase in ending stocks to 38.9 million bushels. Reflecting a higher expected corn price and strong marketings to date, the projected price range for sorghum is raised to $4.90 to $5.70 per bushel, up 10 cents on both ends of the range, compared with $3.22 per bushel in 2009/10.




Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 15, 2010, 10:35:51 AM
Barley and Oats Prices Lowered
Barley yield is estimated at 73.1 bushels per acre, down 0.5 bushels per acre this month; barley production for 2010/11 is lowered 2 million this month to 180 million bushels. Total use remains unchanged this month at 225 million bushels for 2010/11. As a result, ending stocks are forecast at 86 million bushels, down one million. The projected price range is lowered five cents on the low end of the range and 15 cents on the high end of the range at $3.75 to $4.25 per bushel, compared to $4.66 per bushel last year.

Oats yield is estimated 0.3 bushels per acre lower to 64.3 bushels this month. Oats production for 2010/11 is lowered one million bushels to 81 million bushels. The projected price range is lowered to $2.15 to $2.55 per bushel, down five cents on the low end of the range and down 15 cents on the high end of the range, compared with $2.02 per bushel last year.

This month's reduction in the projected price ranges for barley and oats is made to reflect prices received to date by producers. Although cash prices are expected to remain supported by rising corn prices over the coming months, a large share of barley and oats crops have already been sold since the marketing year began on 1 June. Portions of both crops, particularly malting barley, are also contracted further limiting future gains in their season-average prices for 2010/11.

INTERNATIONAL OUTLOOK

World Coarse Grain Production: Mostly a US Reduction
Global coarse grain production for 2010/11 is projected down 3.6 million tons this month to 1,085.2 million. Foreign production is trimmed 0.4 million tons to 752.8 million, with increases nearly offsetting reductions. Foreign corn production is up 2.0 million tons to a record 500.0 million, mostly due to an increase for China. Foreign sorghum is up 0.25 million tons to a record 55.0 million, as good rains and soil moisture in eastern Australia provide for favorable sorghum prospects there. However, these increases are more than offset by reductions in oats, down 1.3 million tons; barley, reduced 0.8 million tons; rye, cut 0.3 million tons and millet and mixed grain, each trimmed 0.1 million tons.

China's corn production forecast for 2010/11 is increased 2.0 million tons to a record 168.0 million as recently published data for 2009/10 indicate higher-than-expected corn area. Growing conditions and harvest weather were mostly favourable, so the projected yield is nearly unchanged this month. Corn production estimated for 2009/10 was increased 3.0 million tons to 158.0 million based on the higher reported area. However, the yield reported by the National Bureau of Statistics is hard to reconcile with the unfavourable weather in key growing regions, and USDA is maintaining a lower estimated yield. The current 2009/10 estimate and 2010/11 forecast implies a year-to-year production increase of 10 million tons, and these yield levels reflect the improved weather.

This month's numbers reflect information lowering China's oats area back to 2005/06. There are also smaller reductions to barley and millet area. Barley yields for 2010/11 are also reduced, cutting production 0.7 million tons to 2.4 million. China's oats production projection is reduced 0.2 million tons to 0.4 million, and millet is trimmed 0.1 million, to 1.5 million. The reduction in other feed grains offsets about half the increase in corn.


Australia's coarse grain production for 2010/11 is forecast up 0.6 million tons to 11.5 million. Good yields in eastern Australia are expected to more than offset drought in the west, boosting barley production 0.3 million tons this month to 7.9 million. Good soil moisture boosts prospects for sorghum yields, increasing production 0.25 million tons to 1.95 million.

Moldova reported excellent corn yields for 2010/11, though area was nearly unchanged from the previous year, boosting production 0.2 million tons to 1.4 million.

Russia's coarse grain production is reduced 1.4 million tons this month to 17.3 million. Harvest reports indicate drought reduced yields for oats and rye, cutting oats production 1.0 million tons to 3.5 million and rye production 0.4 million to 2.1 million.

Based on small revisions to several member country harvest reports, EU coarse grain production is reduced 0.4 million tons this month to 138.8 million as 0.1- million-ton reductions each for barley, corn, mixed grain and oats more than offset a small increase for rye. Belarus barley yield was reported lower than expected, reducing production 0.2 million tons to 1.4 million. Chile reported coarse grain production down 0.1 million tons to 1.7 million, with small declines for corn, oats, and barley. Also, Ukraine reported a slight reduction in millet production based on lower area.

Foreign coarse grain beginning stocks for 2010/11 increased 0.3 million tons to 150.9 million, offsetting a small portion of the production decline. More complete trade data for 2009/10 boosted imports and ending stocks for several importing countries, and EU production for 2009/10 was revised up slightly. These increases more than offset a 0.8-million-ton decline for Argentina, where increased corn feed use is estimated for 2009/10, cutting expected stocks.

Changes in Global Coarse Grain Use Nearly Offsetting This Month
World coarse grain use projected for 2010/11 is down 0.2 million tons to 1,124.0 million, as changes for different countries mostly offset each other. The largest increase in projected use is for China, with coarse grain use up 1.5 million tons. Forecast corn feed use is boosted 2.0 million tons this month based on increased production, but reduced use of barley and oats is partly offsetting. Argentina's 2010/11 corn feed use is up 0.5 million tons to 5.5 million as high meat prices boost feed prospects for both 2009/10 and 2010/11. There are small increases this month in projected coarse grain use for Saudi Arabia, Malaysia, Australia, Moldova and Morocco.

Russia's projected 2010/11 coarse grain use is cut 1.3 million tons this month to 20.4 million. Oats feed use is reduced 0.75 million tons due to lower production, and food seed and industrial use is cut a combined 0.55 million for oats and rye. EU coarse grain feed use is projected 0.65 million tons lower this month mostly due to reduced prospects for corn as more is expected to be exported. Corn feed use in the Philippines is reduced 0.3 million tons to 5.0 million as meat imports limit the growth in corn feed use. Corn use in South Korea is reduced 0.3 million tons to 9.1 million as a 0.5-million-ton reduction in corn feed use due to increased feed-quality wheat imports is partly offset by an increase in expected food and industrial use. There are smaller declines in expected coarse grain use for Israel, Chile, Belarus and Ukraine.


World 2010/11 Coarse Grain Ending Stocks Prospects Reduced
Global coarse grain stocks are projected down 3.1 million tons to 160.2 million, the lowest since 2006/07. This sum of local marketing year ending stocks equals 14 per cent of projected 2010/11 use, down from 18 per cent a year earlier.

The largest reduction in projected coarse grain stocks is for Argentina, down 1.3 million tons to 1.6 million. Most of the decline, 1.2 million tons, is in corn, with increased domestic feed use. Serbia is projected to reduce corn stocks 0.5 million tons to 1.2 million as strong prices are expected to encourage exports and reverse the stock buildup that occurred in 2009/10. With reduced production, ending stocks of coarse grain in Russia and Belarus are lowered 0.2 million and 0.1 million tons, respectively. There are also small reductions this month in projected ending stocks for Chile, China and Jordan.

Increased coarse grain ending stocks for 2010/11 are projected this month for a number of countries, but the increases are small. Australia is up 0.4 million tons to 2.6 million because of increased sorghum and barley production. The EU is increased 0.2 million tons to 10.7 million as feed use is reduced more than exports are increased. Increased beginning stocks boost ending stocks 0.1 million tons for both Malaysia and South Korea. There are smaller increases this month for Moldova, Saudi Arabia, Israel, the Philippines, Ukraine, Switzerland and Tunisia.

US Corn Export Prospects Reduced
US corn exports for trade year 2010/11 (October-September) are reduced 1.5 million tons to 50.0 million, virtually the same as the previous year. (The September-August local marketing year is cut 50 million bushels to 1.95 billion bushels, down two per cent from the previous year.) Strong US prices are expected to limit importers' purchases and encourage some other countries to export.

US export shipments are starting 2010/11 at a modest pace, partly due to strong competition for logistics, especially through Pacific Northwest ports, caused by strong soybean exports. Corn exports during October at 3.4 million tons (Inspections) are well below the pace needed to reach the forecast. However, at the end of October, outstanding export sales were 12.8 million tons, up from 10.1 million a year ago.

Global corn trade is reduced 0.5 million tons to 93.2 million. Corn import prospects for South Korea and Philippines are each reduced 0.3 million tons this month. South Korea is importing more feed-quality wheat and less corn. Rains have damaged some wheat in Australia and Canada, and discounted feed-quality wheat provides an attractive substitute for relatively high priced corn. In the Philippines, meat imports are expected to tone down the rate of growth of meat production and corn feeding, limiting the need to import corn.


Strong corn prices are expected to increase some foreign exporters to boost shipments. EU corn exports are increased 0.5 million tons to 1.0 million as the large corn crops recently harvested in Romania and Bulgaria are in a good position to be shipped to non-EU destinations. Export licences reflect increasing corn export activity. Serbia's corn export prospects are boosted 0.5 million tons this month to 2.5 million as beginning stocks and good production provide ample supplies. Strong prices provide an incentive to overcome logistical problems.

As corn trade data for 2009/10 becomes more complete, estimated trade has increased, up 0.8 million tons this month to 92.5 million. World corn trade in 2009/10 is up 10 per cent from the previous year but down six per cent compared to the 2007/08 record. Recently released export data indicate stronger-than-expected corn exports from Brazil, up 0.4 million tons to 8.6 million, and for India, up 0.3 million to 1.3 million. Imports for Malaysia are boosted 0.3 million tons to 2.8 million, and Egypt is increased 0.2 million to 5.5 million.

Barley trade projected for 2010/11 (October-September) was little changed this month but 2009/10 revisions boosted Ukraine exports and imports for Saudi Arabia. Sorghum trade for 2010/11 was increased slightly this month with increased exports for Australia and imports by the EU.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on November 17, 2010, 09:10:17 AM
Tuesday, November 16, 2010
Weekly Outlook: Uptrend in Crop Prices Stalls
US - Except for a brief retreat in early October, corn, soybean, and wheat prices were in a steady uptrend from 30 June through 9 November writes Darrel Good, Agricultural Economist, University of Illinois



December 2010 corn futures increased about 70 per cent, while January 2011 soybean futures and July 2011 wheat futures increased about 50 per cent.

The fundamental reasons for the large price increases have been well chronicled. The factors include smaller than expected corn acreage in the US, declining US corn yield prospects, a rapid pace of corn use for ethanol, a torrid pace of US soybean exports, rising world vegetable oil demand, a significant decline in wheat production in Russia and Kazakhstan, and a very poor start for the US winter wheat crop. LaNina weather conditions also raised some concern about southern hemisphere crops. In addition, overall demand prospects for US commodities were supported by the declining value of the US dollar and rising energy prices.

Corn prices experienced the sharpest rally due to the magnitude of the decline in US production prospects and expectations of a sharp drawdown in inventories of US corn by the end of the 2010-11 marketing year. The USDA currently projects those stocks at a 15 year low of 827 million bushels.

Soybean prices have been supported by the rapid pace of exports and export sales. The USDA now expects 2010-11 marketing year US soybean exports to reach 1.57 billion bushels, 4.6 per cent above the record exports of a year ago. Through the first 10 weeks of the marketing year, export inspections exceeded those of a year earlier by 25 per cent. Shipments to China were up 49 per cent and China accounts for 68 per cent of all US exports to date. Unshipped export sales as of November 4 were 12 per cent larger than sales of a year ago. China accounted for 58 per cent of those outstanding sales. Even with large exports, expectations were for generally adequate stocks of US soybeans at the end of the 2010-11 marketing year. The projection of those stocks dropped sharply early last week, however, as the USDA lowered the expected size of the 2010 US harvest and increased the forecast of exports.

Soybean oil prices have been supported by the projection of a second consecutive year of a 5 per cent increase in world vegetable oil consumption and a further decline in world vegetable oil stocks. Domestically, soybean oil consumption for food is expected to be near that of last year, while exports are expected to decline by 20 per cent. The USDA projects a 1.2 billion pound (72 per cent) increase in soybean oil use for the production of biodiesel. Use declined sharply last year due to the expiration of the blenders’ tax credit. To reach the USDA projection of 2.9 billion pounds, use will have to average 242 million pounds per month. Use during the last month of the 2009-10 marketing year (September 2010) totaled 98 million pounds.

Wheat prices have been supported by the nearly 6 per cent decline in world wheat production and the expected decline in US and world stocks. Those inventories, however, are expected to be at generally adequate levels. More recent concerns center on the poor condition of the US winter wheat crop and whether Russian wheat production will rebound in 2011.

Prices of all three commodities declined sharply last week. The turn to lower prices was attributed to China’s move to increase interest rates and presumably slow the rate of domestic economic growth. Such a slow down might reduce the rate of growth in Chinese demand for commodities of all types. Price weakness may have also reflected some moderation in supply concerns. The US hard red winter wheat crop received some beneficial precipitation and the USDA increased its projections of some crops outside the US Projections were increased for corn in China, soybeans in South America, and wheat in Argentina and Australia.

There may also be growing concern about the ethanol blender’s tax credit. If that credit is not extended, the pace of ethanol production could drop back to the mandated level. Finally, a private forecast that US corn producers will increase plantings by nearly 5 million acres in 2011 reminded the market that high crop prices will induce a worldwide supply response next year.

While the uptrend in prices stalled last week, there is still a lot of uncertainty about crop supply and demand conditions. Uncertainty about Chinese corn demand, ethanol policy, energy prices, weather, and acreage may result in large price swings, but should provide good support for prices into the end of the year.

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 02, 2010, 08:45:14 AM
Marubeni to take on big five crop traders
[2 December 2010] Japan’s biggest grain trader Marubeni aims to take on the world’s largest agricultural commodity traders by shipping more crops on the back of strong demand for food in emerging Asia. FT.com reported that Marubeni and competitors Itochu, Mitsubishi, Mitsui and Sumitomo are shifting its focus from importing oil and other commodities to their resource-poor home market to abroad. It has identified agricultural commodities as a source of growth as concerns of food security spread in Asia.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 06, 2010, 09:14:08 AM
China to buy 5.5 mmt of US soy
[6 December 2010] China signed an agreement with the US soybean industry on November 22 to buy another 5.5mmt of soybean. This confirms that transportation demand to ship U.S. soybeans will remain strong in the coming months. US soybean commitments at 19.5 mmt (shipments and outstanding sales) for the current year to China are already up nearly 3 mmt from last year. In November, USDA projected that China will import 57 mmt of soybeans in 2010/11, with the United States and Brazil as the main suppliers.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 09, 2010, 05:21:26 AM
US soybean farmers seek to increase share in Philippine market
[7 December 2010] US soybean farmers are looking to increase its share in the Philippine market as it projects higher demand from the livestock and poultry sector. In a statement, the Philippine Association of Feed Millers Inc (PAFMI) said the rising consumption of pork and poultry products will drive demand for feed ingredients like soybean meal and US producers are among those hoping to cash in. To boost sales, AG Processors (AGP), a leading soybean supplier to the Philippines last week led a 15-man delegation to the country to meet with local feed millers, hog raisers and poultry operators. The group is expanding its export facilities in Aberdeen, Washington to meet the growing requirements of Pacific Rim countries including the Philippines. Last year, the Philippines imported 1.5 million tonnes of SBM, with US producers accounting for 35% of the total imports.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 14, 2010, 10:12:45 AM
CME: Year-End Stocks for Corn and Soybean
US - USDA’s December World Agricultural Supply and Demand Estimates (WASDE), released on Friday, contained slightly higher projected year-end stocks for corn and lower projected year-end soybean stocks with neither number differing dramatically from the average of analysts forecasts that were published earlier in the week, write Steve Meyer and Len Steiner.


USDA’s December supply and utilization data for both crops appears on page 3 (please click on the link below).

Corn analysts had expected, on average, a slight reduction in projected year-end corn stocks but the report raised that estimate by 5 million bushels. That change was driven by a 5 billion bushel increase in projected corn imports from Canada. No other number in USDA’s S & U table changed and USDA left its forecast national weighted average farm price at $4.80 to $5.60 per bushel. Though slightly higher, the projected year-end stocks-to-use ratio for corn remains at 6.2 per cent, the second lowest ever. The corn price is expected to increase from last year’s $3.55/bushel in response to the decline in projected year-end stocks-to-use ratio from 13.1 per cent in 2010. These changes reflect the expected negative relationship between quantity and price. However, note the difference between this year’s forecast price and that of 1995-96 when the stocks-touse ratio was at 5 per cent, its lowest level ever. The large difference between the forecast 2010-11 price and the 1995-96 price even with a higher stocks-to-use ratio indicates that corn demand is dramatically higher now than it was in pre-ethanol days.


Global coarse grain (corn, sorghum (milo), oats, barley, rye and millet) supply was increased by 3.4 million tons in 2011 with corn, barley and oats production accounting for 2.2 million, 0.6 million tons and 0.4 million tons, respectively, of that increase. India was the primary driver of the higher corn production number, rising 1.0 million tons from the October estimate.

USDA did reduce projected soybean carry-out stocks by 20 million bushels to 165 million bushels. The reduction was due to a 20 million bushel increase in projected soybean exports, a very reasonable change we think given the rapid pace of exports since 1 September. The reduction in projected carryout stocks pushed the year-end stock-to-use ratio for soybeans down to 4.9 per cent, the 5th lowest ever. Here again, a modestly higher stocksto- use ratio is accompanied by a higher price reflecting the strength of soybean demand.


Friday’s other piece of major news for grains and feed costs is that the compromise tax bill includes a 1-year extension of the ethanol blenders’ tax credit (BTC), the ethanol import tariff as well as the revival of the $1/gallon biodiesel tax credit. The first two were set to expire on 31 December. The biodiesel credit expired at the end of 2009 and we understand that its reinstatement is retroactive, meaning that biodiesel producers can collect the credit on production back to the beginning of 2010. The extension for the BTC and tariff leave them at $0.45 and $0.54/gallon, respectively. The tax bill is expected to pass the Senate but faces an uncertain future in the House where liberal Democrats have vowed to fight it in spite of the support of President Obama.

To us, the most important facet of this deal is its timing. The 2012 run for the White House will begin with the Iowa Caucuses on 6 February 2012. This one-year extension will put the next round of ethanol debates squarely in the middle of the campaigns for those causes. Will anyone be bold enough to oppose the ethanol incentives during their presidential campaign launch?

Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 16, 2010, 08:33:54 AM
US soy farmers to expand share of Philippine market
[15 December 2010] Based on the anticipated growth of the Philippine feedmilling industry, American soybean farmers are looking to further expand their share of Philippine soybean meal supply. Buoyed by a vibrant economy and higher meat and poultry consumption. The Philippines imported 1.5 million metric tonnes of soybean meal last year with US soybean meal taking 35% share of the market. Industry insiders believe this year’s imports may exceed 1.6 million tonnes due to higher feed demand from the pork and poultry sector.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 17, 2010, 10:13:37 AM
Excellent US corn quality in 2010-11
[17 December 2010] US corn quality for the 2010-11 crop is excellent, but the price may rally due to low ending stocks, said Jay O'Neil, Senior Economist at the Kansas State University's International Grains Program. In a webinar held yesterday by the US Grains Council, Mr O'Neil said the crop contains an average moisture content of 14.5% versus 24% in the previous crop, while its protein content appears to be close to 8% versus 7.5% average in the previous crop. "This is a 180-degree turnaround from the previous crop," he said. Due to good weather conditions, the corn was naturally dried in the field and this resulted in low damage (less than 2%, down from 3.5%) and far less BCFM (broken corn and foreign matters)," Mr O'Neil said his data was obtained from interviews with grain silo owners and corn producer cooperatives in several states in the US. However, he said, given a mere 21 million tonnes of carry over corn from 2009-10, corn futures prices could rally to USD6-7/bushel, and could reach USD8/bushel in a year from now, unless a bigger crop is produced. "My advice to buyers is that there is a possibility that the price (or corn) could go very high. You should be careful with your pricing strategy," he said. The US is expected to export 49.5 million tonnes of corn in 2010, a slight decrease from 50.5 million tonnes in 2009, while an estimated 122 million tonnes will be diverted into ethanol production, up from 116 million tonnes in 2009.
Title: Re: Corn & Seed/Oil Commodities
Post by: mikey on December 29, 2010, 11:00:43 AM
Grain trader foresees 20 years of food security issues
[28 December 2010] During the recent International Grains Forum, founder and Managing Director of Singapore-based grain trader Agrocorp International, Vijay Iyengar, said that that global food security was one of the most important issues the world would have to deal with in the next 20 years. He also said that in a long-term look to the future, Africa and the Middle East would be the driver for imports over the next 10 years and Russia and Ukraine showed great potential for exports due to the amount of land that was slowly being made available for agriculture.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 09, 2011, 11:05:40 AM
Seven key drivers that shape Agri Commodities Markets in 2011 07 Jan 2011
Rabobank forecasts further price rises in a number of agricultural markets in 2011. The Agri Commodity Markets Research Outlook 2011 expects potential price rises to be greatest for corn, soybeans and coffee.

In this new report Rabobank agri commodities experts look at the lessons learned from the 2007/2008 food crisis, and list seven key thematic drivers of agricultural commodity markets in 2011.
 
1.Tightening inventory levels
Rabobank’s Luke Chandler believes that the current price rally is both broader and more structurally based than that of 2007/2008. “Stocks-to-use levels in many major products are at or below those seen in 2007/2008, with the exception of wheat. But prices have not responded on the same scale as three years ago. Corn prices, for example, are still 27% below the highs of 2008.”
 
According to the report the difference in the market reaction is partly due to the unstable macro environment in 2010. And energy prices have remained significantly lower than in 2008, providing less support for agricultural prices.
2.Supply limitations
A number of agricultural commodities need to expand production in 2011 to rebuild stock levels, which could cause significant supply constraints.
 
Chandler: “With cotton prices at record highs, a battle for acres is building as farmers decide whether to increase cotton acres over soybeans, wheat and corn.”
 
Other farm-input constraints such as fertiliser, chemicals, finance, seed, labour and machinery may impede efforts to respond to high prices in 2010.
 
In addition the availability of credit for farmers, and the current strength of the La Niña weather system - which heightens the risk of weather and production variability - could limit supply in 2011.
3.Emerging markets
Emerging economies are rebounding quicker from the global financial crisis than the west and are supporting demand for agricultural commodities.
 
For example, wheat demand in China, Brazil, Russia and India grew at 5% in each of the last two seasons, while it contracted 4% over the same period in the US and the EU.
 
Chandler: “Rapid economic expansion and changing dietary demands will continue to pressure traditional export supplies and encourage further investment in expanding supply, forming a key driver in the shift of the agricultural demand curve.”
4.Chinese demand for commodities
Chinese demand has a particular impact in reshaping agricultural commodity markets for soybeans, sugar, cotton and, potentially, corn.
 
“China has played a key role in transforming the global soybean markets,” explains Luke Chandler.
 
“China now accounts for 60% of global soybean imports, in addition to approximately 20% of world traded soybean. This growth has resulted in expanded planted area in the US and South America as soybeans became a major global commodity.”
 
Chandler expect this tremendous growth to be replicated in other commodities as China’s shifting consumption patterns increase demand.
5.Heightened political risk amid tightening food supplies
As seen in the 2007/08 agricultural bull rally, governments are extremely sensitive to food price inflation, and the potential of supply shortages in 2010 brought a muted re-emergence of government intervention in agricultural markets.
 
The imposition of grain export restrictions in the Black Sea region sent wheat prices soaring, and the EU decision to allow larger than expected sugar exports spurred a massive sell-off in November.
 
Chandler: “Governments have always played a role in the markets, a trend that in our view is highly likely to continue in 2011.“
6.Fundamentals only part of the story
With agriculture and agricultural futures markets increasingly being viewed as an attractive asset class by investors, the role of outside market macro drivers are becoming more important in shaping agricultural price movements.
 
Currency markets around the globe are playing an ever more important role in agricultural commodity prices. In addition energy prices are expected to increase in 2011, which will impact the price of sugar and corn, commodities used to produce ethanol.
7.Sustained heightened volatility
The combination of tightening fundamentals and increased macro influence and uncertainty is expected to see the increased price volatility witnessed in most agricultural markets in 2010 sustained at high levels into 2011.
 
Chandler: “We expect the volatility which rose in 2010 after dropping during the recession to remain high for 2011 – largely a result of the impact of the other six thematic drivers we have highlighted.”
 
Macro Economic Outlook
Rabobank’s forecasts for agricultural commodities in 2011 are influenced significantly by global growth assumptions as expressed in the macro economic Outlook 2011.
 
Chandler: “Expectations of continuing macro uncertainty and a mostly two-paced economic recovery in the year ahead suggest that agricultural demand will continue to rely on emerging markets, be it under a cloud of inflationary uncertainty. The continuation of large, undesirable budget imbalances maintained by many developed economies will only slowly be eroded – with fiscal tightening yet to show any marked improvement in the EU and the US.”
 

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 09, 2011, 02:13:21 PM
Philippine coffee yields head downhill
ANNUAL coffee production has headed downhill in the last five years as Mindanao farmers shift to higher-yielding crops and rejuvenate farms, according to the Bureau of Agricultural Statistics (BAS).

Latest BAS statistics on major crops showed coffee production dropped by 1.02% to 96,433 metric tons (MT) last year from 2008’s 97,248. In 2005, the production volume was 105,847 MT. Coffee yields have been falling in the single digits since.

Falling coffee output was a result of the rejuvenation of farms in the Davao Region and the shift of coffee farmers in SOCCKSARGEN to banana and rubber.

Rolando T. Dy, executive director at the University of Asia and the Pacific (UA&P) Center of Food and Agribusiness, said that cutting down and replanting of trees in the Davao farms reduced the region’s overall output and greatly affected the country’s total coffee yield.

On the other hand, the shift to banana and rubber in Sultan Kudarat farms added to the causes of the drop in coffee produce. Roberto Ansaldo of Rocky Mountain Café said that switching has been going on for years since Vietnam and Indonesia were included among the world’s top coffee exporters.

Farm rejuvenation and shift of produce led to the decrease both in land dedicated for planting and the number of bearing trees.

Only 122,645 hectares were used to plant coffee in 2009 as compared to 127,975 hectares in 2005. Similarly, the number of coffee-bearing trees dropped to 85 million in 2009 from 91 million in 2005.

SOCCKSARGEN and the Davao Region are the Philippines’ top coffee producing regions, yielding 27,554 MT and 23,632 MT, respectively, last year.

Among coffee varieties, Robusta coffee was the most popular, accounting for 71.9% of total coffee produce, followed by Arabica and Excelsa, with 20.4% and 6.8% share. Liberica or “barako” coffee accounted for only 7% of the country’s total produce last year. — J.E.S. Tanyag

ANNUAL COFFEE YIELDS IN METRIC TONS,
BY REGION (2005-2009)
Region 2005 2006 2007 2008 2009
Philippines 105,847 104,093 97,877 97,428 96,433
CAR 6,010 6,346 6,252 5,950 5,700
Ilocos Region 78 85 88 98 105
Cagayan Valley 677 1,040 1,062 1,080 1,099
Central Luzon 1,627 1,534 1,591 1,673 1,706
CALABARZON 10,806 10,726 8,819 9,132 9,084
MIMAROPA 202 205 206 207 202
Bicol Region 382 366 340 339 335
Western Visayas 6,095 6,004 5,835 5,734 5,902
Central Visayas 585 364 314 295 251
Eastern Visayas 212 207 197 247 227
Zamboanga Peninsula 1,372 1,368 1,337 1,314 1,263
Northern Mindanao 6,037 6,292 6,287 6,203 6,016
Davao Region 29,769 28,839 24,466 24,066 23,632
SOCCSKSARGEN 27,187 27,047 27,123 27,022 27,554
Caraga 3,850 3,120 3,115 3,147 2,619
ARMM 10,958 11,000 10,844 10,922 10,737
Source: Bureau of Agricultural Statistics
 

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 12, 2011, 12:13:23 PM
Weekly Outlook: Waiting for USDA Reports
US - On January 12, the USDA will release a number of reports that will contain important information for the corn, soybean, and wheat markets writes Darrel Good, Agricultural Economist, University of Illinois.


These reports, along with crop development in the southern hemisphere, will set the tone for the markets into the spring. The Crop Production report will contain final estimates of the size of the 2010 corn and soybean crops. Changes, if any, from the November forecasts are expected to be small. Changes would most likely be in the yield estimates since administrative data has already been incorporated in the acreage forecasts. However, since the December producer survey is much larger than earlier surveys, acreage changes cannot be ruled out. In the previous 10 years, the change in the corn yield estimate in January has ranged from 0.1 bushel to 2.4 bushels and averaged 1.1 bushels. For soybeans, the change has ranged from 0.1 to 0.7 bushel and averaged 0.3 bushel.

The Grain Stocks report will contain estimates of the 1 December 2010 domestic inventory of all the major crops. The most interest will be in the estimate of the corn inventory. This is always the case since the report provides the first indication of the feed and residual use of corn during the first quarter of the marketing year. The report takes on added significance this year since the previous two quarterly stocks reports (June and September, 2010) provided surprises. The September estimate was larger than expected following a smaller than expected estimate in June. The September surprise set off a discussion about whether inventories of the newly harvested crop were inappropriately included and/or whether some of the 2010 harvest was fed in August. The USDA indicated that some new crop may have been fed in August and as a result has forecast 2010-11 marketing year feed and residual use of corn at 5.3 billion bushels, 2.7 per cent more than used in the previous year. Our analysis would suggest that the 1 September stocks estimate was very logical and that the USDA forecast of feed and residual use for 2010-11 may be too high. Additionally, the 16 per cent increase in ethanol production during the first quarter of the 2010-11 marketing year and the resulting increase in production and feeding of distillers’ grain may have substituted for an additional 40 to 50 million bushels of corn feeding. There is some risk, then, that the 1 December corn stocks estimate may reveal a slower pace of feed and residual use than currently forecast by the USDA. The magnitude of stocks will reflect any change in the production estimate and the large ethanol use of corn, as well as actual feed and residual use.

The monthly report of World Agricultural Supply and Demand Estimates will be closely observed for any changes in southern hemisphere production estimates and implications for the export demand for US crops. The estimates of production of corn and soybeans in Argentina will be most closely watched due to dry conditions that have prevailed since mid-October. The corn crop appears to have been most negatively impacted. Any changes in these forecasts, along with the 1 December stocks estimates will be reflected in changes in the projection of year ending stocks of corn and soybeans.

For soybeans, the USDA’s projection of the domestic use of soybean oil for production of methyl ester will be important. Previous reports have forecast a year-over-year increase of 1.219 billion pounds (72.5 per cent). The reinstatement of the biodiesel blender tax credit should support use moving forward, but use during the first two months of the marketing year (October and November 2010) was very small. Use in those two months totaled only 173 million pounds, compared to 485 million in October and November of 2009. To reach the current USDA projection, use during the 10 months from December 2010 through September 2011 will need to average 273 million pounds per month, 126 per cent more than the average of a year earlier. The forecast of soybean oil exports may also be influenced by the rapid increase in palm oil prices and the resulting improvement in the competitive position of soybean oil in the export market.

The Winter Wheat Seedings report is expected to show a large increase in winter wheat acreage following the sharp decline in 2009. The magnitude and location of those increases will have implications for the availability of acreage for spring planted crops, including double cropped soybeans. Beyond the acreage numbers, the condition of the winter wheat crop will have implications for yield and for the potential of replanting some wheat acreage to other crops this spring.

There is added price risk when so much information is released at one time. New estimates and forecasts may provide a consistently positive or negative scenario or they may provide mixed signals that the market will have to sort out. Given the recent history of USDA reports, an important surprise cannot be ruled out.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 13, 2011, 09:20:35 AM
CME: Shrinking Corn Crop Expected to Shrink Further
US - Today's USDA Crop Production report will provide the feds’ final estimate of US corn and soybean crops and, according to the results of DowJones’ monthly pre-report survey, analysts expect the corn crop estimate to be lower and the soybean crop estimate to be higher than those of December, write Steve Meyer and Len Steiner.


The range and average of analysts’ estimates appear in the table below.


The “incredibly shrinking 2010 corn crop” is expected to continue to shrink a bit more with an expected yield of 153.9 bushels per acre. That number is only fractionally lower than the December estimate but is 6.6 per cent smaller than the 2009 yield. Analysts expect the estimated average soybean yield to rise 0.1 bushels from December to 44 bushels per acre, equal to last year’s yield

Those yield levels would push the corn crop down to 12.491 billion bushels, 0.4 per cent lower than December’s 12.54 billion bushels and 4.7 per cent lower than last year’s 13.110 billion bushels. Analysts still expect a record-large soybean crop of 3.376 billion bushels, slightly higher than USDA’s December estimate and 0.5 per cent higher than last year’s crop.

USDA’s quarterly Grain Stocks report will also be released tomorrow. This report is important because it will provide the first checkpoint for usage levels for the 2010 crops. The result of DowJones’ survey of analysts appear above. As expected given the crop estimates above, analysts expect significantly tighter corn stocks and roughly the same level of soybean stocks as were on hand on 1 December 2009.

Our argument last week that cattle prices are still too low relative to corn prices put us in such good stead with our producer readers that we thought we would try to gain the favor of hog producers this week using the same argument. As can be seen in the chart at right, it is not a difficult one to make.

The chart shows the ratio of nearby monthly hog futures to corn futures from 1972 to date. Note that there is one complication of this chart relative to the cattle chart: The change from the original Live Hogs contract to the new Lean Hogs contract priced on a carcass weight basis beginning with the Feb 1997 contract. That change, of course, increased the apparent level of the hog:corn ratio but really just re-defined the critical levels of the number. Where 20:1 was once the critical level for expansion, a ratio of 26.7 would now be required.


As was the case with the fed cattle:corn ratio, the hog:corn ratio has been very low since 2008 when corn prices originally took off as a) oil prices rose and b) ethanol began using a higher and higher percentage of the U.S. corn crop. Since that time, the hog:corn ration has never been very close to the historical relationship — now 26.7:1 based on carcass pricing — required to entice producers to expand output. In fact, the ratio has hardly touched the OLD required level of 20:1 during that time period. But you might say “Yes, but summer LH futures are trading at $93-plus.” True. But July corn futures closed yesterday at $6.20, meaning that the July hog:corn ratio is still only 15.1:1. If these corn prices persists, look for hog prices to move higher yet in order to bring the industry back into a profit position that begets growth.







Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 14, 2011, 01:52:10 PM
World Agricultural Supply and Demand Estimates - January 2011
While US supplies of corn, wheat and soy are expected to be down this month, global supplies of wheat are up, although coarse grain supplies and soybean production globally are lower, according to the latest USDA World Agricultural Supply and Demand Estimates.

Livestock, Poultry and Dairy
The estimate of 2010 red meat and poultry production is raised from last month, reflecting higher production of beef, pork, broilers, and turkey. The forecast of production for 2011 is also raised for beef and broilers, but lowered for pork. The turkey production forecast is unchanged from last month. The increase in beef production reflects large placements of cattle during the fourth quarter of 2010 which will be ready for slaughter during mid-2011. USDA will release its Cattle report on January 28 providing an indication of producer intentions for heifer retention in 2011 and feeder cattle availability. Broiler production forecasts are adjusted to reflect relatively heavy bird weights. Pork production is reduced slightly for 2011. USDA’s Quarterly Hogs and Pigs report indicated that producers intend to farrow fewer sows in the first half of 2011 but continued strong growth in the number of pigs per litter implies relatively abundant supplies of hogs for slaughter will be available during 2011. Higher forecast hog weights will also partly offset the effects of lower farrowings on pork production, but recent increases in weights are not expected to be sustained during the year. The forecast of egg production is unchanged from last month.

The forecast for beef exports for both 2010 and 2011 is unchanged from last month but the forecast of beef imports is lowered as a weak US dollar and tight supplies in several exporting countries limit shipments. The pork export forecasts for 2010 and 2011 are reduced slightly from last month as higher pork prices are expected to more than offset weakness in the US dollar. The broiler export forecast is raised for 2010 but the 2011 forecast is unchanged from last month.

The cattle price forecast for 2011 is raised to reflect continued strong demand for cattle and tightening supplies of fed cattle. Hog prices for 2011 are forecast higher as demand for hogs remains strong. The broiler price forecast is lowered on larger supplies of broilers and competing meats. Egg prices are forecast higher.

The milk production estimate for 2010 and forecast for 2011 are unchanged from last month. Ending stocks for 2010 are reduced due to expected low stocks of butter and nonfat dry milk (NDM) at the end of the year. Imports for 2010 and 2011 are reduced due to low US prices relative to those internationally coupled with a weak US dollar. Skim-solids basis exports are raised as NDM exports are expected to be supported by tight world supplies into mid-2011. Fat basis exports for 2010 are lowered from last month on weaker-than-expected exports of butterfat.

Butter, NDM, and whey prices are forecast higher, but the cheese price forecast is lowered. Tighter beginning stocks support a higher butter price forecast while generally strong exports of NDM and whey will support higher prices. The cheese price forecast is reduced from last month on moderate demand. The Class III price forecast range is reduced as the lower forecast cheese price more than offsets the higher whey price forecast. The Class IV price forecast is raised as both the butter and NDM price forecasts are raised. The all milk price is forecast to average $16.10 to $16.90 per cwt for 2011.

Wheat
US wheat ending stocks for 2010/11 are projected 40 million bushels lower this month as a reduction in expected feed and residual use is more than offset by higher projected exports. Feed and residual use is projected 10 million bushels lower as December 1 stocks, reported in the January Grain Stocks, indicate lower-than-expected disappearance during September-November. Exports are projected 50 million bushels higher reflecting the pace of sales and shipments to date and reduced competition with lower foreign supplies of milling quality wheat. At the projected 1.3 billion bushels, exports would be the highest since 1992/93. Most of the increase is expected in Hard Red Winter and Soft Red Winter wheats, but exports are also raised slightly for Hard Red Spring and white wheats. The marketing-year average price received by producers is projected at $5.50 to $5.80 per bushel, up from $5.30 to $5.70 per bushel last month.

Global 2010/11 wheat supplies are raised slightly this month as increased beginning stocks are mostly offset by lower foreign production. Beginning stocks for Argentina are up 0.9 million tons with upward revisions to 2008/09 and 2009/10 production estimates. Argentina production is also raised 0.5 million tons for 2010/11 as harvest results indicate higher-than-expected yields. Production in Brazil is raised 0.4 million tons as favorably dry harvest weather boosted yields for the 2010/11 crop. EU-27 production is raised 0.3 million tons based on the latest official estimates for Poland. More than offsetting these increases are reductions for Kazakhstan and Australia. Kazakhstan production is lowered 1.3 million tons based on the latest government reports. Australia production is lowered 0.5 million tons as heavy late-December rains and flooding further increased crop losses in Queensland.

World wheat imports and exports for 2010/11 are both raised slightly. South Korea imports are raised 0.4 million tons, mostly offsetting an expected reduction in corn imports. Imports are also raised 0.2 million tons each for Thailand and Vietnam based on the pace of shipments to date and the increased availability of feed quality wheat in Australia. Imports are lowered 0.5 million tons for EU-27 based on the slow pace of import licenses to date. Major shifts among exporters are projected as importers focus on US supplies to meet their milling needs. Australia exports are reduced 1.5 million tons as quality problems limit export opportunities. Kazakhstan exports are reduced 1.0 million tons with lower supplies. While Argentina marketing-year (December-November) exports are raised 0.5 million tons, exports during the remainder of the July-June world trade year are expected to be lower based on the slow pace of government export licensing.

Global 2010/11 wheat consumption is projected 1.2 million tons lower, mostly reflecting reduced wheat feeding in EU-27, the United States, and Kazakhstan. Food use is also lowered for EU-27 and Pakistan. Partly offsetting are increases in feed use in South Korea, Thailand, and Vietnam, and higher expected residual loss in Australia with the rain-damaged crop. Global ending stocks are raised 1.3 million tons with increases for EU-27, Argentina, and Australia, more than offsetting the US reduction.

Coarse Grains
US feed grain supplies for 2010/11 are projected down reflecting lower corn production. US corn production is estimated 93 million bushels lower as a 1.5-bushel-per-acre reduction in the national average yield outweighs a 183,000-acre increase in harvested area. A 5-million-bushel increase in projected US corn imports slightly offsets the reduction in output. Corn feed and residual use is projected 100 million bushels lower based on September-November disappearance as indicated by the December 1 stocks. Corn used for ethanol is raised 100 million bushels offsetting the reduction in expected feed and residual use. Record December ethanol production, as indicated by weekly Energy Information Administration data, boosts corn use to date.

Ending corn stocks for 2010/11 are projected 87 million bushels lower at 745 million. This is down 963 million bushels from last year. The stocks-to-use ratio is projected at 5.5 percent, the lowest since 1995/96 when it dropped to 5.0 percent. The 2010/11 marketing-year average farm price projection is raised 10 cents on both ends of the range to $4.90 to $5.70 per bushel as cash and futures prices are expected to strengthen. Heavy early season marketings of corn priced well below current cash price levels are expected to limit the upside potential for the weighted average price received by producers.

Global 2010/11 coarse grain supplies are projected lower this month with reduced corn, sorghum, oats, and rye production only partly offset by higher projected barley production in Argentina and EU-27. Global corn production is lowered 4.7 million tons with the US reduction and a 1.5-million-ton decrease for Argentina as untimely, persistent dryness during late December and early January reduces yield prospects in key central growing areas. Smaller reductions in corn output are also projected for Indonesia and Turkey, each down 0.4 million tons. Global sorghum production is lowered with a 0.3-million-ton reduction for Brazil based on the latest government estimates. Brazil oats production is lowered slightly in line with government estimates. Russia oats and rye production are lowered 0.3 million tons and 0.4 million tons, respectively, based on the latest government indications.

Global 2010/11 coarse grain trade is lowered as higher expected prices and tighter supplies reduce corn imports and exports. Corn imports are lowered for South Korea, Turkey, and the Philippines, but raised for Indonesia. Corn exports are reduced for Argentina and Turkey, with a partly offsetting increase for Canada. Global corn consumption is lowered mostly reflecting reduced feeding in South Korea and Turkey. Global corn ending stocks are projected 3.0 million tons lower with more than two-thirds of the reduction in the United States.

Oilseeds
US oilseed production for 2010/11 is estimated at 100.5 million tons, down 1.2 million from last month. Lower crops for soybeans, sunflower seed, and canola are only partly offset by increases for peanuts and cottonseed. Soybean production is estimated at 3.329 billion bushels, down 46 million bushels based on reduced harvested area and lower yields. The soybean yield is estimated at 43.5 bushels per acre, down from last year’s record of 44 bushels per acre. Soybean crush is lowered 10 million bushels to 1.655 billion bushels. However, higher projected extraction rates for soybean meal and oil leaves production of both products nearly unchanged. Soybean exports are projected at a record 1.590 billion bushels, unchanged from last month. Soybean ending stocks are projected at 140 million bushels, down 25 million from last month.

The 2010/11 US season-average soybean price range is projected at $11.20 to $12.20, up 50 cents on the lower end of the range. However, early season marketings priced below current cash price levels are expected to limit the upside potential for the weighted average price received by producers. The soybean oil price is forecast at 48 to 52 cents per pound, up three cents on both ends of the range. The soybean meal price is projected at $320 to $360 per short ton, up 10 dollars on both ends of the range.

Global oilseed production for 2010/11 is projected at 440.4 million tons, down 2.3 million from last month. Global soybean production is projected at 255.5 million tons, down 2.3 million. The Argentina soybean crop is projected at 50.5 million tons, down 1.5 million from last month due to lower projected yields. Although recent rains will help producers complete planting, earlier periods of unfavourable dryness have compromised yield potential, especially in some of the major producing areas. Paraguay soybean production is raised 0.5 million tons to 7 million due to increased area and favourable yield prospects. Global oilseed ending stocks for 2010/11 are reduced 2 million tons to 68.3 million with Argentina and US soybean stocks accounting for most of the change
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 18, 2011, 10:21:15 AM
US Grain Exports Continue Despite Korea's FMD
US - US exports to Korea may be slightly affected by a recent bout of foot-and-mouth disease (FMD) but not to the point of great concern, the US Grains Council said.


On 29 November 2010, an outbreak of FMD was first detected in the Republic of Korea and has since spread throughout the country. With more than 100 confirmed cases, this outbreak marks the country’s worst battle with the disease since 2002, which resulted in the slaughtering of 160,000 head of livestock.

The Korean government, led by its Ministry of Agriculture, Forestry and Fisheries (MAFF), has been aggressively engaged, taking significant measures to halt the spread of FMD.

“The Korean government is taking this current outbreak very seriously,” said Byong Ryol Min, USGC director in Korea. “Last week, the government instructed all Korean feed millers and dealers to interrupt feed production and delivery for over 24 hours and implemented a full scale biosecurity measure to mitigate or stop further outbreak of FMD.”

“According to news reports, about 1.5 million animals have been slaughtered thus far, including 120,600 head of cattle or 3.6 per cent of the country’s total inventory. About 1,375,000 hogs have been culled and 4,400 goats and deer. MAFF also decided to vaccinate 210,000 hogs in the infected concentrated hog farming areas.”

While the numbers may seem alarming, Min projected that if no further outbreaks occur in Korea this year, the nation’s total mixed feed consumption will be decreased by 2-2.5 per cent compared to 2010. While this is certainly an unanticipated, short-term disruption in Korea’s demand for feed grains, longer term demand for US grain remains strong.

“Korea imported 5.9 million metric tons (232.3 million bushels) of corn for feed use during January – November 2010, 5.4 million tons (212.6 million bushels) or 92 per cent of which came from the United States. The country also imported 1.9 million tons (74.8 million bushels) of corn for food and industrial use during that same period, of which 1.2 million tons (47.2 million bushels) or 64 per cent is from the United States,” he said.

“Considering the fact that Korea imported nearly 2 million tons of feed wheat during the first 11 months of 2010 and the fact that feed wheat prices will be quite strong in 2011, the disease alone may not badly affect Korea’s feed corn imports from the United States.”

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 20, 2011, 07:19:47 AM
Soy, Corn Prices Need to Direct Consumption, Acreage
US - Over the next three months, the prices of corn and soybeans have two major objectives. Firstly, prices must allocate remaining old crop supplies to maintain at least pipeline stocks by the end of the current marketing year, and second, prices must direct spring planting decisions, writes Darrel Good, Agricultural Economist at the University of Illinois.


For soybeans, the USDA now projects that the combined total of domestic crush and exports during the current marketing year will reach 3.245 billion bushels. That is only eight million bushels, or 0.25 per cent, less than the total of last year. At the projected level of use, year ending stocks would total only 140 million bushels, or 4.2 per cent of total use that includes seed, feed, and residual uses. Year ending stocks cannot be reduced much below 140 million bushels and still maintain pipeline supplies so total use cannot exceed current projections by a substantial amount.

During the first quarter of the current marketing year, soybean crush and exports totalled 1.063 billion bushels, 82 million (8.4 per cent) more than during the first quarter last year. Use during the remainder of the year, then, will be limited to about 2.182 billion bushels, which is 90 million bushels (four per cent) less than use during the same period last year. The pace of consumption clearly needs to decline and that decline has been occurring. The National Oilseed Processor Association estimates the December 2010 crush by their members was 11.5 per cent below that of December 2009. If the national crush was down 10 per cent, the December 2010 crush was 17 million less than in December 2009.

Based on weekly export inspection figures, US soybean exports from 1 December 2010 through 6 January 2011 were 40 million less than that of a year ago. The total of crush and exports since December 1, 2011, was 57 million bushels, or nearly 14 per cent, less than the total of a year ago. Soybean consumption has slowed much more than the approximately four per cent needed to ration current supplies. Consumption for the rest of the year needs to be only 33 million less than that of a year ago.

For corn, the USDA now projects 2010-11 marketing year consumption at 13.43 billion bushels. That is 364 million bushels, or 2.8 per cent, more than consumed last year. At the projected level of consumption, year ending stocks will total only 745 million bushels, or 5.5 per cent of consumption. Stocks cannot be reduced much below that level and still maintain pipeline supplies so total consumption cannot substantially exceed the current projection.

During the first quarter of the marketing year, corn consumption totalled 4.117 billion bushels. That is 253 million bushels, or 6.5 per cent, more than consumed in the same quarter a year earlier. Use during the remainder of the year will be limited to about 9.313 billion bushels, which is only 111 million bushels, or 1.2 per cent, more than consumed during the same period last year. Corn exports from December 1 through January 6 were 21 million bushels (15.4 per cent) larger than during the same period last year. Ethanol use of corn was 55 million bushels (11.6 per cent) larger than during the same period a year ago. Total non-feed use of corn since 1 December was 76 million bushels (13.6 per cent) more than use of a year earlier. Depending on the rate of feed and residual use since 1 December, it appears that total corn consumption during the rest of the year can exceed that of a year earlier by only about 35 million bushels.

It appears that soybean prices have increased enough to ration current supplies but corn prices have not, although the demand for US corn and soybeans will still be influenced by the outcome of South American production. It appears that the Argentine corn crop, and perhaps the soybean crop, could be smaller than the current USDA forecast, further increasing the export demand for both crops.

The prospects for both very tight year-ending stocks of corn and soybeans and a continuation of strong demand implies that 2011 crops need to be large. More acreage of both crops in the US may be needed to meet projected consumption levels at reasonable prices and to start re-building domestic stocks to a more acceptable level.

Planted acreage of all crops in the US declined by 8.3 million acres from 2008 to 2010. At the same time, acreage enrolled in the Conservation Reserve Program declined by 3.4 million acres. These changes suggest that as much as 11.7 million acres of additional crop land (including double-cropped acres) may be available for planting in 2011. Of that total, 3.7 million has already been planted to winter wheat. Double-cropped acreage of soybeans following wheat harvest could increase by two million acres, following a similar decline last year. That leaves six million acres for additional acreage of spring planted crops in 2011. Soybeans may not require any of that acreage due to increased double cropping. Assuming that corn consumption remains near the 13.4 million bushel level next year, that year ending stocks need to expand by at least 500 million bushels next year, and that the 2011 average corn yield is near the trend of 159 bushels, most of that six million acres needs to be planted to corn.

Based on the need to reduce the pace of consumption and to aggressively expand acreage, corn prices likely need to remain high in absolute terms and relative to other crop prices for an extended period.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 23, 2011, 01:44:04 PM
Australia remains world's 5th-largest wheat exporter 21 Jan 2011
Australia maintained its position as the fifth-largest global exporter of wheat in 2009-10. Exports to China increased in 2009/10 and imports of Australian wheat by Middle Eastern countries decreased, Wheat Exports Australia said.
 
The total global wheat trade reached 127 mt in the international trade year that ended June 30, 2010, WEA said.
 
Australia's top six bulk wheat exporters shipped 9.6 mt and accounted for 79% of total bulk exports in 2009-10. The top four exporters each shipped in excess of 1.0 mt of bulk wheat, accounting for 64% of Australian bulk wheat exports.
 
Position challenged
Historically, Australia has held a position in the top five major wheat-exporting countries, but in recent years this position has been challenged by growing exports from the former Soviet Union states of Russia, Ukraine and Kazakhstan.
 
About 20% of global wheat production is sold internationally, with the trade averaging 115 mt a year in the 10 years ended 2009-10, peaking with growth of 41% to 143 mt in 2008-09, WEA reported.
 
Shifts in trade
The regulator identified other major shifts in the global trade that might have a significant impact on Australia, including changes in demand from China, which as the world's biggest producer, has the potential to significantly impact world trade depending on its production and grain stocks.
 
Australian wheat exports to China nearly tripled to 647,000 tonnes in 2009-10. Middle Eastern countries cut imports to around 10 mt in 2009-10 as a result of an increase in domestic production and stagnant domestic consumption, a contraction that has had a significant impact on Australia's wheat exports.
 
Historically, around 40% of Australia's wheat exports went to the Middle East, but in the five years ended 2009-10 this fell to 2.0 million tons, or 14% of total exports.
 
The Iraq war and past limitations on the Australian wheat trade to Iraq were major factors behind this change, but Australia has also faced increasing competition from traditional rivals such as the US and Canada, and newer competitors, such as India.
 
However in 2009-10, Saudi Arabia almost ceased domestic wheat production and has recommenced importing, wheat offering further potential for Australian exports to the region.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 26, 2011, 04:03:25 AM
Weekly Outlook: Corn, Soybean Supplies for 2011
US - The USDA projects that corn stocks at the end of the 2010-11 marketing year will total only 745 million bushels, writes Darrel Good, agricultural economist at the University of Illinois.


That projection represents 5.5 per cent of projected marketing year consumption. Stocks as a per cent of consumption would be the smallest since the record low 5 per cent of 1995-96. Five per cent is considered to be a minimal pipeline supply.

Marketing year ending stocks of soybeans are projected at 140 million bushels, or 4.2 per cent of projected consumption. That ratio is slightly smaller than the previous low of 4.4 per cent in 2003-04. The low level of inventories projected for this year reflects different market conditions than those that existed in either 1995-96 or 2003-04. Both of those years were characterized by small crops that required a sharp reduction in the level of consumption just to maintain minimum year ending stocks. Year-over-year consumption of corn declined by 8.5 per cent in 1995-96 and soybean consumption declined by 9.5 per cent in 2003-04.

In contrast, corn consumption during the current marketing year is expected to be 2.8 per cent larger than the record of last year. Soybean consumption is expected to be about equal to last year’s record. The low level of expected year ending corn stocks are the result of a 2010 corn crop that was 5 per cent smaller than the record crop of 2009 and a rapid acceleration in the use of corn for ethanol production. The 2010 soybean crop was only 0.8 per cent smaller than the record crop of 2009. Stocks at the beginning of the year, however, were small and exports are expected to be record large. Exports are increasing primarily as a result of strong Chinese demand.

Strong US and world crop demand, scattered production problems in 2010 and early 2011, and prospects for generally tight stocks have pushed corn and soybean prices high enough to raise concerns about more rapid food price inflation. The question now is whether the year ahead will bring some change in the tight supply/high price scenario. Much of the attention will be on the prospective size of the 2011 US corn and soybean crops and the level of demand for those crops.

First a look at corn demand prospects for the 2011-12 marketing year. There is likely to be some further weakness in domestic feed demand resulting from current high feed costs and further liquidation of livestock numbers. Export demand is more difficult to anticipate due to the uncertainty of world grain production, the pace of economic growth, and trade policy. Demand at the same level as this year may be the best forecast. The level of use of corn for ethanol production may be the most important factor. Use during the current marketing year is expected to be well above the level required to meet renewable fuel mandates. The mandates for 2011 and 2012 would require about 4.7 billion bushels of corn to be used for ethanol production during the 2011-12 marketing year, or 200 million less than expected to be used this year. Use could exceed the mandate again next year if blending economics remain favorable. Corn consumption in 2011-12 could decline by 100 to 300 million bushels from the projected level for this year.

A 200 million bushel decline would put total corn consumption at 13.23 billion bushels in 2011-12. With a trend yield of 159 bushels in 2011, harvested acreage would need to total 83.2 million acres to produce 12.23 billion bushels of corn. Planted acreage would need to be near 90.3 million, 2.1 million more than planted in 2010. If demand is stronger than expected and/or stock rebuilding is to begin and if there needs to be some allowance for yield risk, planted acreage may need to be in the range of 92 to 93 million acres.

Demand for US soybeans in 2011-12 is likely to remain strong due to a modest production shortfall in Argentina this year and continued strong Chinese demand. If consumption remains near 3.35 billion bushels and the 2011 US average yield is near the trend value of 43.2 bushels, harvested acreage will need to total about 77.5 million acres to maintain pipeline supplies at the end of the 2011-12 marketing year. Planted acreage would need to be near 78.5 million, 1.1 million more than planted in 2010. To allow some modest rebuilding of stocks and to allow for yield risk, planted acreage may need to be near 79.5 million. Additional double cropping will help meet the need.

It appears that combined acreage of corn and soybeans needs to increase about 6.5 million acres in 2011 to allow for some modest rebuilding of US inventories. A smaller increase would require above trend yields to avoid another year of very tight supplies.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 29, 2011, 09:57:21 AM
China Likely to Limit Corn Imports Soon
CHINA - China, the world's second-biggest corn consumer, may limit imports this year after the government told industrial users to stop buying the domestic supply, according to Yigu Information Consulting Ltd.


Starch and ethanol producers use about 40 million tons a year, so a temporary halt in purchases may free material for the livestock industry, said Feng Lichen, general manager of Yigu, which runs the country's biggest corn information portal.

China imported 1.57 million tons of corn in 2010, according to customs data, the most in about 14 years, as the government sought to cool food inflation running at 9.6 per cent in December. The country may boost purchases "to upward of" 7.4 million tons this year, said Thomas Dorr, president of the US Grains Council, in December.

"China isn't yet at a stage where it must use imports," which at the moment are more expensive than domestic supply, Mr Feng said from Dalian.

The State reserves were given priority to buy corn at below-market rates while other users, including biochemical producers owned by COFCO Ltd, were ordered to halt procurement, Mr Feng said on 17 January. These companies have now stopped buying, Grain.gov.cn said on Thursday.

The government is concerned about pork supply for the people, so this policy essentially ensures domestic supply can meet livestock use, he said.

Industrial users consume about 4 million tons of corn a month so "a couple of months of their consumption" will likely meet the reserves' goal of boosting inventory by around 10 million tons, Feng said.

China produced 164 million tons of corn in the marketing year ended 30 September, with 99 million tons used by the livestock industry and 45 million tons by producers of bio-chemicals, data from the China National Grain & Oils Information Center show.

Buying by trading companies, which stockpile the grain as part of their operations, has also stopped as the government restricts their financing, so purchase prices may come down to where the State reserves will start buying, Mr Feng said.

Most of the imports last year came from the United States, customs data show. Import estimates for this year from analysts including Feng and Shanghai JC Intelligence Co range from 1.5 million tons to 5 million tons. The exact level will depend on how much corn is planted and crop development, Mr Feng said.

As of Tuesday, the post-tax cost of so-called No 2 yellow US corn shipped into Chinese ports for March delivery was about 2,562 yuan ($389), according to industry website Jcce.cn. The spot price in southern China was 2,160 yuan a ton, according to data from Shanghai JC Intelligence Co.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 30, 2011, 04:25:52 AM
Japanese feedstuff manufacturer cuts corn in animal feed 26 Jan 2011
Chubu Shiryo Co Ltd, a leading Japanese feedstuff manufacturer, has started making some animal feed with less corn as the price of corn continues to rise, a company official said on Monday.

According to Reuters, the official said that the move will not immediately affect the volume of Japanese corn imports, though this could change when the company starts reducing corn volumes in a broader range of feeds.

Chubu Siryo started feed shipments for egg-producing chickens this month, with the use of corn cut from 50% to 30%, the average mix in compound feed for chickens in Japan, the official said. It plans to extend the move to feed used for pigs as well, although the official declined to set a timeframe for this.
 
The company increased the proportion of alternatives, primarily corn meal and wheat bran, without damaging the nutrition quality, helped by a processing technology the company has developed to improve the cost of processing feed from meal, he said.
 
"Our improved processing facility has enabled us to beef up the recycling of meal, which hadn't been done previously, as a way to contain the cost of rising corn prices," the official said, adding that the company aimed to eventually reduce the use of corn to around 10%.
 
Japan's annual compound feed output is about 24 million tonnes. About 40% of compound feed is for chickens and 25% for pigs.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 11, 2011, 11:39:38 AM
Thursday, March 10, 2011Print This Page
CME: Pre-Report Estimates for Latest USDA Reports
US - USDA’s Crop Production and World Supply and Demand Estimates (WASDE) reports will be released today (Thursday) at 8:30 a.m. EST, report Steve Meyer and Len Steiner.


The table below shows analysts’ pre-report estimates for some of the key numbers regarding corn, soybeans and wheat. Note that we pulled the US estimates from Dow Jones’ survey (19 observations for corn and beans, 17 for wheat) and the world estimates for the survey by Reuters (8 observations for wheat and soybeans, 9 for corn).


As expected, none of this month’s estimates are significantly different from those of last month. Analysts apparently expect high prices to have a small impact on corn and soybean usage.

By far the most optimistic number in the table is the one for projected year-end world soybean stocks, which is roughly 1 million metric tonnes higher than last month. That number is driven primarily by an expected increase in the Brazilian soybean crop. A separate Reuters survey indicated that analysts expect the 2011 Brazilian soybean crop to be 69.781 million metric tonnes, 1.281 MMT higher than USDA’s February estimate. The analysts estimate that Argentina’s soybean crop will fall slightly from last month’s 49.5 MMT to 49.198 MMT. Analysts expect Brazil’s corn crop to remain steady at 51 MMT while the Argentine corn crop is expected to be 20.857 MMT, 5 per cent lower than last month’s USDA estimate of 22 MMT.

The trade will now focus on USDA’s March 31 Planting Intentions report to get its first real picture of 2011 US corn, soybean, wheat and cotton output. We again mention cotton because it will be a major player in acreage allocation decisions this year, especially in Southeastern states.

Planted acres may be step one but yields make or break a crop and there is plenty of concern about this year’s potential yields in light of the ongoing La Nina event. Iowa State University climatologist Dr. Elwyn Taylor pegs the “most likely” US corn yield for this year at 148 bu./acre. That is only 1 bu./acre higher than the poor weather yield from Darrel Good and Scott Irwin’s University of Illinois paper that we discussed yesterday. According to Dr Taylor, the ongoing La Nina is the third strongest on record, trailing only those of 1974 and 1989. The 1974 episode strengthened in March of that year and resulted in unfavorable yield conditions that summer. The ‘74 yield was roughly 16 bu./acre below the trend yield. The 1989 event declined in March and dissipated by June. 1989 corn yield was virtually even with the trend yield for that year.

Why is the US beef industry not responding to positive signals and showing signs of expansion? Or even more to the point — why did US cowmen liquidate so many cows last year when cow-calf operations were generally profitable and expectations should have been positive? Those questions have been batted around by a number of analysts over the past year and the first one was the subject of Dr. Derrell Peel’s March 7 “Cow/Calf Corner” published by the Oklahoma Cooperative Extension Service. Peel states that “The market is clearly trying to encourage cow-calf producers to rebuild cow herds. Yet there is no definitive indication that producers are retaining heifers at this time.” He offers two reasons for cowmen’s reticence:

Excitement with current price levels but general skepticism that these prices will last. This feeling that current prices are a short run aberration which will soon be followed by a market correction belies the fact that the supply fundamentals underpinning the current market have been building for several years. He also points out that beef demand, though in his opinion not recovered from recessionary weakness, is moving the in the right direction. Add in strong export markets and he believes there is ample evidence that this is not short run price strength.


Serious concerns that input prices will continue to increase and thus erase the profits gains from higher cattle prices. Peel observes that there is some fatalism in that belief — ie. no mater what a producer does, there is limited (or no) profit potential in cattle. But he points out that high cattle prices provide an opportunity to manage profitability by controlling things that can be controlled. “Agricultural producers have always had more opportunity to influence profitability by managing costs than by changing market prices,” he points out. Rising input prices beget adjustments and cattle are very flexible critters. Cowmen need to think broadly.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 16, 2011, 01:39:00 AM
Tuesday, March 15, 2011Print This Page
Corn and Soybean Prices – Mission Accomplished?
US - In our newsletter of 18 January, it was suggested that corn and soybean prices had the dual objectives of allocating old crop supplies so as to maintain pipeline supplies at the end of the year and directing spring planting decisions writes Darrel Good, Agricultural Economist at the University of Illinois.


Specifically, prices needed to ensure an increase in corn acreage and to maintain soybean acreage at the 2010 level.

For soybeans, the declining pace of both the domestic crush and exports, along with the prospects for a large increase in double-cropped acreage in 2011, suggested that soybean prices had increased enough by mid-January to accomplish the dual price objectives. That conclusion was reinforced by the improving condition of the Brazilian soybean crop and prospects for a record harvest in 2011. The USDA confirmed prospects for a record large Brazilian soybean crop last week. Soybean prices increased another $.40 from 18 January to the peak on 9 February. Since then, May 2011 soybean futures have declined about $1.30. The decline in November 2011 futures has been only slightly less.

For corn, the conclusion in mid-January was that prices would need to remain very strong to slow the pace of consumption and to motivate a large increase in planted acreage. May 2011 corn futures increased nearly $.60 from January 18 to the peak on 4 March. December 2011 futures increased about $.40 to the much earlier peak on 11 February. Corn prices have declined sharply since early March and are now back to the level of mid-January. The rapid decline suggests the market believes that corn prices have accomplished their objectives. The likelihood that old crop consumption has been slowed enough comes from two perspectives. First is the macro-perspective. Recent world events are seen as a threat to the fragile economic recovery that is underway. Political unrest in North Africa and the Middle East has pushed crude oil and gasoline prices nearly 15 per cent higher in the past month. Those higher prices could slow economic growth and curb commodity demand, including demand for agricultural commodities. Now, the devastating earthquake and tsunami in Japan may challenge the Japanese and world economies, pointing to the possibility of a further slowdown in global demand growth.

The second perspective of corn demand comes from the flow of information relative to the pace of consumption. During the first half of the 2010-11 marketing year, ethanol production, and presumably the amount of corn used for ethanol production, was 15 per cent larger than during the same period last year. Last year, however, ethanol production was relatively small during the first half of the corn marketing year and accelerated rapidly in the last half of the year. Year-over-year increases in ethanol production will be much smaller for the last half of the 2010-11 marketing year. Still, use during that period needs to be only 2.3 per cent larger than use of a year ago to reach the USDA projection of 4.95 billion bushels of corn used for ethanol production.

The pace of corn exports has also been slow enough that the USDA projection of marketing year exports of 1.95 billion bushels is not expected to be exceeded. While the pace of corn export sales accelerated during the 5 weeks ended 24 February, the pace of shipments remains generally slow. Cumulative marketing year export inspections through March 10 were about 10 million bushels less than the total of a year ago. In addition, Census Bureau estimates of corn exports through January were only 26 million bushels larger than cumulative inspections. Last year, Census estimates through January exceeded inspections by 63 million bushels. Like last year, exports will have to increase rapidly in the last half of the year in order to reach the USDA projection for the year. That pace may now be threatened by the situation in Japan, although not much is known about damage to total port capacity, transportation infrastructure, or the livestock industry. Japan is the largest importer of US corn and as of 3 March, 116 million bushels of corn sales to Japan had not been shipped.

Finally, corn prices have been pushed lower by ideas that producers have already made plans for a large increase in corn acreage in 2011. Some are projecting planted acreage above the USDA expectation of 92 million acres and even above our calculation of a needed 93 million acres. These expectations of large corn acreage underscore the importance of the USDA’s 31 March Prospective Plantings report.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 24, 2011, 01:21:03 PM
Wednesday, March 23, 2011
Global Wheat Production to Increase in 2011
GLOBAL - FAO's first forecast for world wheat production in 2011 stands at 676 million tonnes, representing a growth of 3.4 percent from 2010, the March 2011 edition of the Crop Prospects and Food Situation report said today.
 

This level would still be below the bumper harvests in 2008 and 2009.

Wheat plantings in many countries have increased or are expected to increase this year in response to strong prices, while yield recoveries are forecast in areas that were affected by drought in 2010, the Russian Federation in particular, the report specified.

As the bulk of the world's coarse grains and paddy crops are yet to be planted, it is, however, too early to forecast total cereal production for this year.

Food deficit countries importing less, paying more
Looking back to last year's production, the FAO report notes that in the low-income food-deficit countries (LIFDCs) as a group, the 2010 cereal output rose by 5.6 percent, a development that will result in reduced cereal imports in the 2010/11marketing years.

But this will not necessarily spell much relief for these countries as their overall cereal import bill is estimated to increase by 20 percent because of higher international prices.

Africa - a mixed picture
Prospects for the 2011 May-June harvests of winter wheat and coarse grains in North Africa are generally favourable, except in Tunisia where dry conditions in January dampened hopes for a robust wheat production recovery. The current situation in North Africa has resulted in the displacement of large numbers of people and disruption to the flow of goods and services in this heavily cereal-import dependent region.

In Southern Africa, the outlook for the main 2011 maize crop is favourable and relatively low prices have helped stabilize food security. A record crop of maize is forecast in Malawi and Zambia. However, in South Africa, the largest producer in the subregion, a sharp drop in production is forecast from last year due to reduced plantings in response to high level of stocks and low prices for maize at planting time.

In Eastern Africa, despite bumper harvests in 2010 and generally low prices, food insecurity has increased in the drought-stricken pastoral areas. In Western Africa, post-election violence in Cote d'Ivoire continued to damage general economic conditions in the subregion and, in particular, trade.

Asia and South America
In Asia, good 2011 wheat harvests are forecast in India and Pakistan. In China, the drought situation in the North Plain has been eased by recent precipitation but the outlook for the wheat crop still remains uncertain.

In the Asia CIS subregion, where Kazakhstan is the major producer, the bulk of the crop is yet to be sown but in view of current strong prices plantings are expected to be in line with the relatively high level of the past two years. Assuming a recovery in yields after last year's drought-reduced level, a significant increase in production could be achieved.

In South America, however, where the season is well advanced, prospects for the 2011 maize crop are unfavourable in Argentina and Uruguay due to persistent dry weather linked to the La Niña weather event. In Brazil, by contrast, the outlook is positive after good rainfall since planting improved soil moisture conditions for developing crops.

Food assistance required in 29 countries
The need for food assistance, nevertheless, persists in many areas, the bulletin reported, with 29 countries currently requiring external assistance for food. Of these, 21 countries are in Africa and seven in Asia, including the Democratic People's Republic of Korea. The displacement of large numbers of people in North Africa because of recent political events in that region also has made emergency assistance necessary.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 29, 2011, 09:15:22 AM
Monday, March 28, 2011
An Eye on Recovery Efforts and Feed Grain Trade
JAPAN - The US Grains Council reports the Japanese industry has been making significant strides to regain its normal feed mill production capacity within the next few months.


“Assuming significant escalation of the nuclear power plant issues will not arise and in spite of the horrendous losses suffered in Japan, the Council believes the consumer demand in Japan will remain strong and will drive continued imports of US coarse grains,” said Tommy Hamamoto, USGC director in Japan. “In the short-term, logistical issues will continue to be a problem, but the Japanese feed industry is working hard to recover from the damage. By April or May, the Council is hopeful Japan will recover and return to a somewhat normalcy.”

As previously reported by the Council, four of Japan’s major importing facilities and attached feed mills were severely damaged by the earthquake and subsequent tsunami that struck Japan on 11 March. These four facilities account for approximately 3.66 million metric tons of compound feed production per year – around 15 per cent of Japan’s total annual compound feed production of 25 million tons. Another mill, which accounts for an additional 15 per cent, suffered some damage but compound feed production has already partially resumed.

“Japan is prepared to cover the feed loss by facilities coming back online and increased production in unaffected mills. These [unaffected] mills are sending feed supplies in small vessels to affected areas,” Hamamoto said. “There are currently bottlenecks: the capacity of unaffected ports to unload redirected shipments and storage limitations; impeded passage of ships through channels caused by debris in shipping lanes; increased transportation costs, fuel supplies and shortage of trucks and ships; and power needed for production and processing. The Council hopes those serious bottlenecks will be short-term setbacks in the recovery efforts.”

The Council has heard reports of limited loss of animal herds or flocks.

“Since the majority of livestock and poultry farms are located near Japan’s mountain side (west side of Japan), minimal animal loss is expected from the tsunami. However, logistics of fuels, feed and products continue to be a problem for those farms,” said Hiroko Sakashita, USGC associate director in Japan, adding the Council anticipates knowing the total impact in a few weeks. “In addition, some animal production was affected as facilities had to be evacuated due to elevated radiation levels. This market may further be affected by negative perceptions and false information on their products.”

Exposure to radiation will remain a longer term concern. Japan’s Ministry of Agriculture Forestry and Fisheries released a notice alerting livestock farmers to be cautious and not to feed radioactive-material-contaminated hay, roughage, silage and water to livestock. It recommends that farmers keep their animals indoors if possible. According to Council sources, feed millers in Hokkaido, Chukyo, Kansai and Kyushu have been working around the clock to ensure that sufficient supply of animal feed is available in the damaged area.

“The Council is searching for the best opportunity to get involved with the relief efforts in Japan. Mostly what we hear is to wait, since much of the relief is being provided by the Japanese government,” Hamamoto said. “The Council will continue to monitor the recovery efforts and determine how to best utilize our resources and assets to help mitigate long term damage.”

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 07, 2011, 12:19:02 AM
Friday, April 01, 2011
High Commodity Prices Continue in Light of Report
US - High commodity prices appear to be here to stay indefinitely despite a US Department of Agriculture report issued yesterday that projects increased US corn acreage this year, said a Purdue University agricultural economist.
Purdue News
 

The Prospective Plantings report projects that corn farmers will plant more corn acres and fewer soybeans. Corinne Alexander said the report, coupled with lower-than-expected US grain inventories, offers little hope for relief from high commodity prices.

"US grain stocks, or inventories, are very tight, and whether that is because of lower production or higher use, we don't know yet," Professor Alexander said. "What we do know is that we need to have at least an average crop production year in 2011 to keep up with the current rate of use."

Professor Alexander and Chris Hurt, another Purdue agricultural economist, will present a free live webinar from 7-8:30 p.m. EDT Thursday (31 March) to update US farmers on the report – what it means for US and world grain markets and likely effects on prices. They also will offer strategies for pricing crops and capturing revenue offered by the markets.

The report, issued annually and based on farmer surveys nationwide, projects a 5 per cent increase in corn acres, at 92.2 million acres, and a 1 per cent decrease in soybean acres, at 76.6 million acres.

At those projections, even with average yields commodity prices are unlikely to decrease because of the tight world grain inventories. Any price relief would have to come in the form of an above-average yield; even still, Professor Alexander said the price relief would be marginal.

If yields were abnormally poor, commodity prices would increase to the point of rationing use, she said.

"In the event of poor crop yields in 2011, prices would have to increase enough to reduce usage by 1 billion bushels for corn and 200 million bushels for soybeans," Professor Alexander said. "That would mean an average-crop-year corn price of $7.50 per bushel and $14.75 per bushel for soybeans."

Higher grain prices mean higher consumer food costs and high feed costs for livestock producers.

"Feed is the biggest cost for livestock producers," Professor Hurt said. "If grain prices continue upward, there could come a point when many livestock producers would start to liquidate."

With current market livestock prices, some producers can afford up to $8 per bushel on corn. Anything higher would be enough to drive many operations toward financial losses.

Although high grain prices initially seem to benefit growers, Alexander cautioned that prices high enough to induce rationing eventually could lead to lower demand and lower prices.

"If we end up in a rationing scenario, it could lead to demand destruction for grain producers," Professor Alexander said. "Herd liquidations could ultimately translate into lower crop demand in subsequent years, which could reduce grain prices."

Information for the Prospective Plantings report is gathered in early March, so Professor Hurt cautioned that in any given year the difference between what farmers tell the USDA they intend to plant and what they actually plant can shift.

"If we get into a situation where planting is delayed and farmers are unable to get corn planted early enough, many will switch those acres to soybeans," he said. "Some producers may also change their minds on what to plant based on what commodity markets are doing."

Twenty-four Purdue Extension County offices will serve as host sites for the webinar. To find a local host county, please click here and click the nearby counties on the Indiana map.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 08, 2011, 01:17:39 PM
World Agricultural Production - March 2011
 

Brazil: Good Conditions for First-Crop Corn Boost Harvest Prospects
 Brazil corn production for 2010/11 is forecast at 53.0 million tons, up 2.0 million or 4 percent from last month, but down 3.1 million or 6 percent from last year. Harvested area is estimated at 12.90 million hectares, up 0.15 million or 1 percent from last month and down 0.03 million or 1 percent from last year. Yield is forecast at 4.11 tons per hectare, up 3 percent from last month but down 5 from last year.

Brazil has two corn crops. The first is a long-season crop that is planted in late September. The long-season crop is currently maturing and is in good condition. The second is the safrinha crop, which is grown mainly in the center-west region. Safrinha’s share of the country’s corn crop has increased significantly during the past five years, to nearly 40 percent of Brazil’s total corn output. Safrinha corn is planted immediately after the harvest of the early-maturing soybeans, but soybean harvest delays have resulted in a high occurrence of the safrinha corn being planted beyond the normal planting window, which typically ends in late February. Final yields for safrinha corn will depend largely on precipitation from March through early May.


Argentina: Estimated Record Yield for Wheat
The USDA forecasts Argentine wheat production for 2010/11 at 15.0 million tons, up 36 percent from last year. Area is estimated at 4.3 million hectares, up nearly 18 percent from last year. Yield is estimated at a record 3.49 tons per hectare, up 16 percent from last year and substantially higher than the five-year average of 2.58 tons per hectare.

Low soil moisture caused some concern at the onset of planting, but timely rains in early November allowed high prices to push more area into wheat than last year. Frequent rains throughout the season were beneficial and increased yields more than expected. Harvest is in progress.


Australia: Wheat Prospects Stable Despite Poor Crop Conditions in the West and Delayed Harvest in the East
Australia’s 2010/11 wheat harvest is complete, with the majority of the crop already delivered to bulk handlers. The USDA estimates production at 26.0 million tons, up 1.0 million or 4 percent from last month, and up 4.0 million or 19 percent from last year. Estimated output is the highest in 7 years. The area is estimated at 13.4 million hectares, down 5 percent from last year. The yield is forecast at 1.95 tons per hectare, 25 percent higher than last year.

The major wheat cropping areas in New South Wales, Queensland, Victoria and South Australia experienced overall excellent water availability and favorably cool weather throughout the growing season. Although excessive rainfall in eastern Australia from late November through early January resulted in harvest delays and a likely reduction in grain quality, the wheat crop along the east coast is reported to be the highest in many years. Western Australia experienced one of the worst seasons for wheat and other winter crops in over 40 years, with low soil moisture and above-average temperatures throughout the season for much of the west coast. Wheat output in Western Australia turned out to be better than previously projected. The yield gains in New South Wales, Queensland, Victoria, and South Australia offset the year-to-year decline in Western Australia.


Mexico: Cold Snap Destroys Winter Corn in Sinaloa
The USDA forecasts Mexican corn production for 2010/11 at 22.0 million tons, down 8 percent from last month but up 8 percent from last year. Area is estimated at 6.6 million hectares, down 5 percent from last month but up 5 percent from last year. A cold snap in early February that lasted nearly a week damaged winter corn in the state of Sinaloa, with temperatures plunging to minus 8 degree Celsius in some locations. On February 4, the coldest night, 14 of 32 temperature stations reported values of minus 1 degree or lower. Frost damage for corn occurs when the temperatures drop below -1 degree Celsius. Sinaloa plants approximately 1.3 million hectares of corn and produces roughly 4.5 million metric tons, or around 25 percent of Mexico’s total corn production. Industry sources estimate that 90 percent of Sinaloa’s corn crop – roughly 90,000 hectares – may have been damaged by the prolonged below-normal temperatures. Mexico produces two corn crops: spring/summer and fall/winter. The fall/winter crop accounts for 25 percent of the country’s total corn production, and 75 percent of the winter corn is produced in Sinaloa. The rest is grown in the Tamaulipas and Veracruz area. Sinaloa corn is sown in December and January and harvested in May/June, and nearly all is irrigated.

Brazil: Estimated Soybean Production Increased
Brazil soybean production for 2010/11 is estimated at 70.0 million tons, up 1.5 million or 2 percent from last month, and up 1.0 million or 1 percent from last year. Harvested area is estimated at 24.25 million hectares, unchanged from last month but up 0.75 million or 3 percent from last year. Yield is estimated at 2.89 tons per hectare, up 2 percent from last month but down 2 percent from last year. The soy crop is in good condition. Harvest is underway, with progress slightly behind average and yields reported as average to above average. Harvest delays are attributed to late planting (due to low soil moisture when farmers were ready to plant) and frequent rain during February. The wet weather has led to occurrences of fields being harvested with a high grain moisture content. Some soybean fields were “terminated” (treated with chemicals to enable farmers to begin harvesting soybeans that were not yet fully mature) so that they could begin planting the second (safrinha) cotton and corn crops. Now that the window to plant the safrinha crops has closed, the harvest of later-planted and longer-season soybeans will begin.

China Soybean Revisions for 2009/10 and 2010/11
China’s 2010/11 soybean production is estimated at 15.2 million tons, up 0.8 million or 6 percent from last month and 0.2 million or 1.5 percent from last year’s revised estimate. Area is estimated at 8.8 million hectares, up 5 percent from last month but down 4 percent from last year. Farmers planted less soybean acreage in 2010 because profits were higher for alternative crops such as rice and corn. The estimated yield of 1.73 tons per hectare is up 6 percent from the drought-impacted crop of 2009/10 and above the 5-year average. The weather in 2010 was generally favorable for soybean growth in Northeast China, where more than 50 percent of the crop is produced. The area and production estimates for 2009/10 were revised upward to 9.2 million hectares and 15.0 million tons based on official government statistics.

Australia: Record Cotton Crop Forecast
The USDA forecasts Australia’s 2010/11 cotton production at 4.5 million 480-pound bales, up 0.5 million or 13 percent from last month and 154 percent from last year. Harvested area is forecast at 0.6 million hectares, up 7 percent from last month, and up 0.4 million or 200 percent from last year. The yield is forecast at 1633 kg/ha, up 5 percent from last month but down 15 percent from last year.

Australia cotton is at advanced flowering to boll formation stages. The favorable planting conditions, combined with rising cotton prices, led to increased plantings of both irrigated and dryland cotton. Most cotton growing regions in New South Wales and Queensland experienced above-normal winter and spring rainfall resulting in excellent planting conditions in October and November. Irrigation water is plentiful, with improved on-farm reservoirs and water allocations up 100 percent.

From late November to early January, rainfall was excessive in some major cotton growing areas of central-south Queensland and northern New South Wales. This caused moderate to excessive flooding in some areas. Although the floods had devastating impact in certain areas, field observations made by crop-assessment specialists from the USDA Foreign Agricultural Service indicate that most cotton growing areas actually experienced limited flood damage and the majority of cropping areas are now benefiting from the improved soil moisture profiles and the abundant irrigation reserves. Prospects are high for both yields and total harvested areas and by all estimates the Australian cotton industry is on track for a record cotton harvest.


Brazil: Estimated Cotton Production Increased
Brazil cotton production for 2010/11 is estimated at 8.80 million bales, up 0.60 million bales or 7 percent from last month and up 3.35 million bales or 61 percent from last year. Harvested area is estimated at 1.30 million hectares, 7 percent from last month, and up 56 percent from last year. Yield is estimated at 1,474 kilograms per hectare, nearly unchanged from last month, but up 6 percent compared to last year.

The early-planted, long-season cotton crop is setting bolls and is in good condition. A reduction in the area sown to soybeans in the center-west region (due to wet planting weather) coupled with high cotton prices provided incentive for farmers to increase first-season cotton area. The second-season (safrinha) cotton crop is planted immediately after the harvest of the early maturing soy crop in mid-January, but weather-related harvest delays for soybeans in the centerwest region has resulted in late planting safrinha cotton. Final yields for safrinha cotton typically depend in large part on the amount of rainfall received before the dry season arrives in early May.


India's Cotton Production Revised Downward
India's 2010/11 cotton production is estimated at 25.0 million 480-pound bales, down 4 percent from last month, but up 2 million or 9 percent from last year. Area is estimated at 11 million hectares, a 7 percent upward change from last year. The yield is 495 kilograms per hectare, slightly up from last from last year.

The 2010 monsoon rainfall progressed well. In general, cumulative rainfall was very favorable compared to the previous year, promoting good crop development. According to the provisional planting estimates from the Ministry of Agriculture in India, cotton plantings in the major producing areas increased from last year. Encouraged by relatively favorable early-season rainfall, high domestic prices, and anticipated export demand, cotton growers in the States of Gujarat, Maharashtra and Madhya Pradesh significantly increased planted area compared to last year. As of December, the majority of the crop was in advanced maturity stages and rated in mostly fair to good condition. Harvest is underway and progressing well in most areas. Deliveries to ginning facilities are higher than last year in several states, including Punjab, Gujarat, and Madhya Pradesh, although recent market arrivals indicate a smaller crop than previously projected. This is due in large part to drier-than-normal weather toward the end of the season, especially in Gujarat. The poor late-season weather has resulted in declining yield prospects.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 19, 2011, 01:40:53 AM
Monday, April 18, 2011
CME: Wheat Feeding, Impact on Corn Demand
US - The issue of wheat feeding and the potential impact on corn demand remains a hot topic in the marketplace and we received plenty of valuable input following our last report, write Steve Meyer and Len Steiner.


We thought we’d share some of that input and expand a bit on the issue.

Soft red winter wheat (SRW) planted acres are sharply higher. The attached chart gives you an idea of the spread of winter wheat. According to our calculations show total planted acres for 2011 at 7.948 million, 57 per cent higher than a year ago. Some other estimates we have seen are slightly different but we did a quick math of acres east of the Mississippi and this is likely close enough for this analysis. Total wheat acres in 2011 are 3.9 million acres higher and even though SRW accounts for just 19 per cent of acres planted with winter wheat, it will contribute about 74 per cent of the growth.

 

 
USDA noted in their latest WASDE report that “increased prospects for 2011 SRW wheat production and higher year-to-year corn plantings in the South reduce expected corn feed and residual disappearance during the second half of the 2010/11 corn marketing year.” The question everybody is asking is: Will hog and poultry producers replace high priced corn with wheat? There are logistical, economic and management considerations that will affect this decision.

Logistically, SRW wheat is relatively close to large poultry operations in the Southeast and transportation costs should not be significantly higher than for corn, indeed they may be lower in some cases. Also, there is SRW supply that could easily go into hog operations in the Southeast and even those in the Midwest. Basis (the difference between futures and local cash price) is an important consideration whenever doing a comparison of feed prices. Chicago futures may show one price level but that needs to be adjusted for the local price, which reflects availability, quality and transportation costs. In our view, the big issue with including wheat in a hog or poultry ration will be from a management perspective.

One of the downsides of having relatively low corn prices for the last three decades is that people get used to a set diet and there is relatively limited experience with other feeds, such as wheat. Can you feed wheat to pigs and broilers? Yes. We have seen some research which reference broiler diets with up to 80 per cent wheat1. Also, research has shown that “wheat can replace all the corn in diets fed to all categories of pigs.2” But, to include a new feed requires more than just replacing corn with wheat, it requires a change of the entire feeding regimen, the feed also needs to be handled differently and may require additional work. Finally, producers need to be sure how the feed change will affect meat attributes (fat color in broilers for instance).

Bottom line: We will likely see some wheat feeding, and those with experience will use more wheat than in other years but we think that this will not be as quick to implement as some may think and the eventual supply of wheat fed to hogs and poultry will likely be smaller than some expect.







Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 24, 2011, 01:01:10 AM
Friday, April 22, 2011
China's Ag Sector Faces Rising Costs in 2011
CHINA - China's agriculture sector is expected to face increasing pressures from rising costs in 2011, according to China's Rural Economy (2010-2011), a report released Tuesday by a leading think tank.

According to China Daily, fertilizer prices, which increased during the fourth quarter last year, were likely to keep rising this year while stock feed prices are also likely to rise, the Chinese Academy of Social Sciences (CASS) said in the report.

The CASS report also predicted grain prices, especially of corn, to continue to trend upwards in 2011. Further, the report urged greater efforts to stabilize agricultural production costs, by increasing supply and tightening market regulations.

China's annual grain output is estimated to reach 550 million tonnes in 2011, the report said.

China's grain output rose 2.9 per cent year-on-year to 546.41 million tons in 2010, marking it the seventh consecutive year of growth for China's grain output.

On foreign trade of agricultural products, the report said imports and exports of China's agricultural products are both expected to slow in the medium and long term.

Statistics from the Ministry of Agriculture showed that China's export volume of agricultural products registered an average of 13.2 percent annual growth from 2002 to 2010.

According to the report, China has maintained a high rate of grain self-sufficiency.

In 2010, China's domestically-grown rice, wheat and corn is estimated to have accounted for about 99.8 percent, 98.9 percent, and 99.1 percent of the total domestic grain market share, the report said.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 26, 2011, 09:47:05 AM
Feed Outlook - April 2011
The recent grains stocks report confirms that supplies are tight, according to Tom Capehart and Edward Allen in the latest report from the USDA Economic Research Service.
 

Summary
The Grain Stocks report issued by USDA’s National Agricultural Statistics Service (NASS) at the end of March shows relatively tight March 1 stocks for each of the feed grains. US corn feed and residual use is lowered 50 million bushels due to the recent run-up in corn prices and increased prospects for wheat feeding this summer. Corn used to producer ethanol is increased by 50 million bushels this month as ethanol production continues at near-record levels. The midpoints of the forecasts of the marketing year average prices received by farmers for corn, sorghum and oats are unchanged this month but the price ranges were narrowed. World coarse grain production and consumption are increased, especially for Sub-Saharan Africa, boosting global ending stocks prospects slightly.



Figure 1. US feed grain average prices received by farmers
Source USDA, National Agricultural Statistics Service, Quick Stats
Domestic Outlook
Domestic supply and use of feed grains unchanged from last month
US feed grain supplies for 2010/11 remain at 380.3 million metric tons this month, unchanged from last month’s projection but down 4.4 per cent from last year. Total use of the four feed grains is projected to be 359.4 million metric tons. With demand exceeding supply, ending stocks are expected to be drawn down to 20.9 million metric tons, the lowest level since the end of the 1995/96 marketing year.

Feed and residual use for the four feed grains plus wheat on a September-August marketing year basis decreased by about 0.7 million metric tons from last month to 143.8 million. Grain-consuming animal units (GCAUs) are projected at 93.0 million this month, down slightly from last month's 93.3 million. Feed and residual use per animal unit is unchanged this month at 1.54 tons, the same as last year.

Grain stocks report confirms tight stocks situation
The Grain Stocks report, issued by USDA’s National Agricultural Statistics Service (NASS) on 31 March 2011, shows relatively tight stocks for each of the feed grains. Corn stocks on1 March were pegged at 6,523 million bushels, down 15 per cent from the previous year. Stocks were considerably lower than most trade estimates but about what USDA was expecting. Within a few days of the Grain Stocks report, May corn futures rose more than $1.00 a bushel, and prices exceeded the previous all-time high for the nearby contract, providing evidence that more price rationing needs to occur. With incentives to feed wheat this summer



Figure 2. Corn feed and residual: comparison of first half of year versus second half of year
Source USDA, World Agricultural Outlook Board, WASDE
due to favourable wheat prices relative to corn, corn feed and residual use is lowered by 50 million bushels to 5,150 million bushels, offset by an increase in wheat feeding expected this summer.

Feed and residual use in the second half of the marketing year, forecast to be about 1,517 million bushels, is expected to be only 29.5 per cent of the 5,150 million bushel marketing year total. This would be the lowest share since at least 1975. Feed and residual use in the second half of the year is expected to be the second lowest in absolute terms since 1975, behind the drought year of 1983. It would be down slightly from the 1,571 million estimated for 1995/96. Since 1995/96, corn used for ethanol is up more than 12-fold, adding substantially to available supplies of feed byproducts.

Projected sorghum feed and residual is increased by 10 million bushels this month and oat feed and residual is decreased by 15 million bushels, reflecting feed and residual use to date as indicated by the March 1 stocks. Feed and residual use for barley remains unchanged from last month.

Corn and sorghum used for ethanol is increased
Corn used for ethanol is projected up 50 million bushels from last month at 5,000 million bushels for 2010/11. Sorghum used for ethanol is increased by five million bushels from last month. Ethanol production data are incomplete for the first half of the marketing year, as February data have not been released by Energy Information Administration (EIA). Monthly ethanol production for January 2011 (the latest available data) was record high at 1,181 million gallons. Ethanol corn use for February likely declined from January based on weekly EIA data for ethanol production. Weekly production data also suggest corn use for ethanol during March will be nearly as high as in January.



Figure 3. US corn: Central Illinois cash and average farm price, monthly
Sources: USDA, Agricultural Marketing Service, Weekly Grain Market News Summary, and USDA, Economic Research Service, Feed Grains Database





Figure 4. US sorghum: Kansas City cash and average farm price, monthly
Sources: USDA, Agricultural Marketing Service, Weekly Grain Market News Summary, and USDA, Economic Research Service, Feed Grains Database
Combining the February estimate with reported monthly ethanol production indicates that September-February corn used for ethanol was up 14 per cent from the first half of 2009/10.

Corn export for 2010/11 are projected at 1,950 million bushels, unchanged from last month but down 37 million from the previous year. Sorghum exports are lowered 10 million bushels to 140 million bushels due to the slow pace of sales and shipments caused by tight US supplies.

Even with record-high prices, total disappearance of corn is expected to be record high, pushing corn ending stocks for 2010/11 to 675 million bushels, a 15-year low. The corn stocks-to-use ratio is projected to fall to five per cent, matching the record low set at the end of the 1995/96 marketing year. This level translates into about an 18-day supply of old-crop corn at the beginning of the 2011/12 marketing year; however, some new-crop corn is usually harvested and available for use before the September 1 start of the new marketing year.

Minor changes to feed grain prices
The season-average corn farm price for 2010/11 is expected to hit a record level, averaging between $5.20 and $5.60 per bushel. The $5.40 mid-point is unchanged from last month but the range is narrowed by 10 cents. Price ranges are also narrowed for sorghum, barley and oats but the midpoints are unchanged at $5.40, $3.80 and $2.45 a bushel, respectively. The sorghum farm price forecast is a record high.

 



Figure 5. US barley utilisation
Source USDA, World Agricultural Outlook Board, WASDE





Figure 6. Barley prices received by US farmers, monthly
Source USDA, National Agricultural Statistics Service, Quick Stats





Figure 7. US oats utilization
Source USDA, World Agricultural Outlook Board, WASDE





Figure 8. US oats: average farm price, monthly
Source USDA, National Agricultural Statistics Service, Quick Stats
March prospective planting intentions report confirms USDA’s initial projections
US farmers plan to plant 92.2 million acres of corn this year, an increase of four million acres from last year. In February, USDA released the USDA Agricultural Projections to 2020 and forecast 2011 planted acreage at 92 million. Corn acreage increased the most in the Northern Plains region, comprised of Kansas, Nebraska, North Dakota and South Dakota. Corn acreage increased by 1.9 million acres in the Northern Plains, compared with a 1.1-million increase in the Corn Belt States (Illinois, Indiana, Iowa, Missouri and Ohio). The big year-to-year increase for the Northern Plains as compared with the Corn Belt has implications for the national average yield as yields in the Northern Plains are about 15 per cent less than yields in the Corn Belt.



Figure 9. Change in corn planted area from 2010 to 2011 (1,000 acres), USDA farm production regions
Source USDA/National Agricultural Statistics Service Prospective Planting, 31 March 2011
Almost all corn-producing States show an increase in expected corn acreage, with the exception of a 150,000-acre decline in Texas. Texas farmers indicate cotton will provide a much better return, increasing plantings by 548,000 acres.

US farmers also plan to increase plantings of sorghum and barley in 2011, up marginally for both crops from last year at 5.645 million acres for sorghum and 2.952 million acres for barley. Oat plantings are expected to decline to 2.839 million acres.

International Outlook
Global coarse grain supplies boosted this month
World coarse grain production and beginning stocks forecasts for 2010/11 are increased this month, boosting supplies 6.3 million tons. Production is up 4.5 million tons to 1,084.1 million, led by a 2.2-million-ton increase for sorghum, a 1.4-million-ton boost for millet and a 1.2-million-ton increase for corn. Global barley production is reduced 0.4 million tons this month, with rye, oats and mixed grain virtually unchanged.

Most of the increased global sorghum and virtually all the millet production increase are in Sub-Saharan Africa. Although some locations in the region have suffered excess dryness or floods, in general, rains and temperatures have been favourable across most of the region. Sorghum production is up 2.0 million tons for the region to 29.1 million.

There were numerous changes to coarse grain production as all Sub-Saharan countries in the database were reviewed this month but the most dramatic increases are for Niger, up 1.5 million tons to 5.5 million; Sudan, up 1.0 million to 5.9 million; Uganda, up 0.7 million to 3.4 million; Burkina, up 0.7 million to 4.2 million; and Chad, up 0.3 million to 1.6 million. These are all countries where sorghum and millet are used primarily for human consumption, especially among lower income groups, so the economic implications of the increased production are significant.

Although corn production in the region is projected up only 0.4 million tons this month to 54.7 million tons, reduced prospects in South Africa partly offset increases in several other countries. South Africa’s corn production is projected down 0.5 million tons to 12.0 million as dryness during February in the high-yielding eastern part of the Maize Triangle (Mpumalanga) hit corn during grain fill and reduced yields. Area was reported slightly lower as well. With large corn stocks and transportation problems limiting exports, the incentives to plant corn have not been strong enough to maintain area.



Figure 10. South Africa's corn production and yield
Source USDA, World Agricultural Outlook Board, WASDE





Figure 11. Brazil's corn production and yield
Source USDA, World Agricultural Outlook Board, WASDE
Important corn production changes are made this month to forecasts for several countries outside Sub-Saharan Africa. Brazil’s corn production projection is increased 2.0 million tons to 55.0 million. Harvest reports indicate the first-crop production was larger than expected as harvesting conditions were favourably dry in the south. Moreover, second-crop area planted exceeded expectations despite excessive rains and harvesting delays for soybeans in Mato Grosso and Mato Grosso do Sul. High corn prices and well-drained soils have supported corn planting despite excess rain. Good growing conditions supported increased corn production prospects this month for Paraguay, up 0.4 million tons; Cambodia, up 0.3 million; are Saudi Arabia, Thailand, Peru, Ukraine and Jordan, smaller increases.

Corn production prospects are reduced this month for Indonesia, down 1.3 million tons to 6.8 million. Excess rains and high input costs are limiting production. Forecast corn production in Egypt is cut 0.5 million tons to 6.5 million as both area and average yields are reduced. Iran’s production is reduced 0.3 million tons to 1.7 million as area and yields are reported similar to those of the past two years. There are smaller reductions in corn production for Colombia, Russia, Syria, Yemen and Malaysia.

Sorghum production prospects for Australia are up 0.2 million tons this month to 2.4 million as favorable moisture boosted area and yield prospects.

Syria’s barley production for 2010/11 is revised down 0.9 million tons to 0.8 million as area and yield are reported to have been similar to 4 of the last 5 years (much better than in 2008/09). The Syria revision and small changes to several other countries more than offset increased barley prospects for Iran, up 0.4 million tons, and smaller increases for China, Afghanistan, and Russia.

Coarse grain beginning stocks for 2010/11 are up 1.8 million tons this month to 196.9 million. There are small revisions for numerous countries causing changes in beginning stocks of less than 0.1 million tons, but these are offsetting. The largest change is for Iran, with beginning stocks increased 1.3 million tons, with corn up 0.8 million and barley increased 0.5 million. Revisions to historical production back to 2007/08 boosted estimated stocks for corn and barley. Indonesia’s corn stocks are boosted 0.2 million tons to 0.7 million due to reduced use estimated for 2009/10. Russia’s barley beginning stocks for 2010/11 are up 0.2 million tons because of small production revisions for several years of history. There are also increases in 2010/11 coarse grain beginning stocks of 0.1 million tons this month for Saudi Arabia, Peru and Benin. The largest decline in beginning stocks was a 0.2-million-ton decline for China’s barley due to reduced production estimated for 2009/10.

World coarse grain use projected higher
Global coarse grain consumption in 2010/11 is projected up 5.4 million tons this month to 1,125.4 million. Most of the increase, 3.3 million tons, is in Sub-Saharan Africa with increased human food consumption facilitated by increased production. China’s corn consumption is projected 2.0 million tons higher to 164.0 million tons. Half the increase is in feed and residual use and half in food and industrial use. Corn prices in China reflect strong demand supported by economic growth. Brazil’s increased corn production and growth in poultry production supports a 0.5-million-ton increase in feed use. Thai corn feed use is also up 0.5 million tons this month as more is being used domestically and less exported. This month there are increases of 0.3 million tons or less in projected coarse grain use for Iran, Cambodia, Russia, Ukraine, Peru and the EU.

Coarse grain consumption prospects are reduced this month for Syria, down 0.5 million tons due to reduced barley production. Egypt’s corn use is cut 0.5 million tons because of reduced production, with more than half the reduction in food and industrial use. There are also reductions of 0.1 million tons in projected corn use for Colombia, Israel, Saudi Arabia and Indonesia.

Global coarse grain stock prospects increased slightly
World coarse grain stocks for 2010/11 are projected 0.8 million tons higher to 155.7 million tons. Most of this month’s increased supplies are expected to be used, as demand remains strong despite high prevailing prices in most countries. Coarse grain ending stocks in the Sub-Saharan region are projected up 1.2 million tons this month to 11.3 million due to increased production prospects. Iran’s 2010/11 ending stocks are up 1.2 million tons because of increased beginning stocks. Ukraine’s coarse grain ending stocks are up 0.4 million tons this month mostly due to reduced barley export prospects. Saudi Arabia’s coarse grain stocks prospects are up 0.2 million tons due to increased corn stocks and reduced expected barley use. Cambodia’s ending stocks of corn are up 0.2 million tons because of increased production.

Reduced 2010/11 coarse grain ending stocks are projected for China, down 1.4 million tons, due to strong demand for corn. Syria’s coarse grain ending stocks are cut 0.5 million tons, mostly because of reduced barley production. Canada’s ending stocks are trimmed 0.4 million tons as corn import prospects are reduced. Other changes in projected ending stocks were less than 0.1 million tons.

World corn trade boosted slightly; US corn exports unchanged
Global corn trade in 2010/11 is projected to reach 92.4 million tons, up 0.3 million this month. Imports are up 0.9 million tons to 2.0 million for Indonesia as production prospects there are cut. China’s imports are boosted 0.5 million tons to 1.5 million supported by high prices in China relative to the United States in the first half of March. These increases are partly offset by reductions for Canada, down 0.4 million tons to 1.2 million due to the slow pace of purchases, and by reductions of 0.1 million tons each for Israel and Peru.

Corn export prospects are boosted 1.0 million tons for Brazil to 11.0 million due to increased production prospects and the strong pace of exports during the first months of the 2010/11 October-September trade year. These are record-large corn exports for the trade year. Brazil’s March-February local marketing year exports are raised 1.5 million tons to 8.5 million. Paraguay’s corn export prospects are up 0.2 million tons to 1.6 million due to increased production.

Corn export prospects are reduced this month for Thailand, down 0.5 million tons to 0.2 million, the lowest in five years, as domestic use has been strong. South Africa’s exports are trimmed 0.3 million tons to 2.2 million as transportation costs are limiting exports despite large stocks. Rail transport is not working as well as in the past, pushing exporters to truck more corn to ports.



Figure 12. US corn exports by month
Source USDC US Census Bureau
US corn exports remain projected to reach 50.0 million tons in 2010/11 (1.95 billion bushels for the local marketing year). Census data indicate October-February shipments of 17.3 million tons, down one per cent from a year earlier. March corn export inspections were 4.5 million tons, down three per cent from a year ago. However, outstanding export sales as of31 March 2011, were 13.5 million tons, up 37 per cent from the previous year. Strong shipments are expected in the last half of 2010/11 but the 2010/11 outstanding sales carried over to the next year are also expected to be exceptionally large.

US sorghum export prospects reduced
US sorghum exports for 2010/11 are reduced 0.2 million tons this month to 3.6 million – for the local marketing year, down 10 million bushels to 140 million – due to tight US supplies and increased domestic use. The early-season shipment pace has been slow, with Census exports for October-February of 1.3 million tons, down 32 per cent compared to the previous year. March inspections showed some turnaround, reaching 0.54 million tons, up from 0.36 a year ago. But as of 31 March 2011, outstanding sales were 0.70 million tons, down from 0.75 million tons a year earlier.

Global sorghum trade is projected slightly higher this month, with the US export reduction more than offset by an increase for Australia. EU imports were increased 0.1 million tons to 0.8 million based on strong purchases to date. World barley trade is reduced slightly this month to 15.6 million tons, with reductions in exports from the Ukraine due to the extension of export restrictions through the end of 2010/11. Imports by Saudi Arabia are also trimmed.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 29, 2011, 05:37:02 AM
Thursday, April 28, 2011
CME: Slow Start to Corn Planting Season
US - With news of the slow start to the corn planting season percolating in the markets, the question many are asking is: What does this mean to me and my business? The quick answer predictably is: it depends, write Steve Meyer and Len Steiner.


For corn producers, wet field conditions and the inability to plant the crop in time may mean money left on the table, long nights of worry and extreme toil, racing against time. Studies have shown that corn planted after 15 May may suffer yield loss although much depends on weather during the rest of the growing season. If you are a livestock producer, the slow start to the season adds another element of risk to an already volatile marketplace. Indeed, that volatility may become even more stomach churning as the exchange is contemplating increasing the trading limit for corn from 30 to 50 cents. Supplies of old corn are quickly dwindling and chances are we will start the new marketing year in September with some of the emptiest bins on record. As we have said before, this market has no room for error and we will need above trend yields to start to repair the corn supply situation.


The late start increases the chances that yields may not hit required levels, thus assuring high corn prices in 2011-12. Cattle, hog and poultry producers will likely refrain from any supply increases until they have a better sense of what the crop will be like. The late planting could further delay livestock and poultry expansion. For retailers and foodservice operators, delays in corn plantings imply that wholesale price pressures may persist well into 2012, thus affecting their margins, their customer counts and their plans for future growth.


Advances in technology have made it possible for large farmers to accelerate plantings if weather permits. USDA reported that in week#16 (ending 24 April), just 9 per cent of the corn crop had been planted, compared to 46 per cent a year ago. We had a similar situation in 2008, when in week #16 (ending 20 April) just 4 per cent of the crop had been planted and in week #17 (ending 27 April), 10 per cent of the crop was in the ground. However, by 18 May 2008, 73 per cent of the crop was planted and final yields that year were about the same as the USDA initial trend estimate indicated. See attached table for the relationship between planting dates and final yields. Note that we are using the USDA weekly number identification to make year to year comparisons. One thing that is different this year is that we expect a big increase in corn acres from areas that do not always plant corn. Extreme moisture conditions could cause those ‘intended’ marginal acres to not materialize thus affecting final production prospects. We can still make up the lost ground but risks of a poor crop are increasing with each passing day, especially with forecasts for more precipitation in the next 10 days.



Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 04, 2011, 11:04:24 AM
Tuesday, May 03, 2011
Corn And Soybean Prices Continue Erratic Pattern
US - As expected, corn and soybean prices continue to move erratically in a very wide range. Just in the past week, both May 2011 corn and soybean futures had a $0.56 trading range, writes Darrel Good, Agricultural Economist at the University of Illinois.


As the markets make the transition from old crop to new crop dominance, a lot of factors are influencing price expectations.

For soybeans, the Census Bureau soybean crush report released on April 28 revealed that the March 2011 crush was about 10 percent smaller than that of March 2010. Through the first 7 months of the 2010-11 marketing year, the crush was 7.4 percent smaller than the crush during the same period last year. For the year, the USDA has projected a decline of 5.8 percent. Last year, the crush was unusually large in the first half of the year and declined rapidly from April through August. The seasonal decline may be less pronounced this year. Still, the crush for the year may fall marginally short of the current USDA projection of 1.65 billion bushels.

The pace of soybean exports and export sales has declined sharply and export inspections during the weeks ended April 21 and 28 fell below the weekly rate needed to meet the USDA projection of 1.58 billion bushels for the year. Reports of on-going measures in China to cool economic expansion, along with large South American supplies, suggest a continued slow rate of exports.

Expectations about the 2011 U.S. soybean crop have centered on some planting delays for corn and the implication for soybean acreage. With corn planting likely to continue through May, if needed, there is no strong indication yet that planted acreage of soybeans will deviate substantially from March intentions.

For corn, weekly export inspections remain well below the pace needed to reach the USDA projection of 1.95 billion bushels for the year ending on August 31, 2011. Inspections need to average 42.9 million bushels per week to reach that projection. For the 5 weeks ended April 28, weekly inspections averaged 38 million bushels.

The weekly estimates of domestic ethanol production have also been erratic. Based on weekly estimates through April 22, it appears that total ethanol production in March and the first three weeks of April was nearly 6 percent larger than in the same period last year. This compares to the 4 percent increase that is needed from March through August for corn used for ethanol and by-product production to reach the USDA projection of 5 billion bushels.

Little is known about the rate of domestic corn feeding. Declining hog and cattle prices raise some concern about feed demand. However, the feedlot inventory of cattle on April 1, 2011 was 5 percent larger than the inventory of a year earlier. In addition, the rapid switch to wheat feeding that was being discussed a few weeks ago has likely been put on hold as wheat prices have increased relative to corn prices. The June 1 Grain Stocks report, to be released on June 30, will reveal the rate of feed and residual use of corn during the third quarter of the marketing year.

The most discussed item last week was the delay in corn planting and expectations about planting progress over the next two weeks. For much of the corn belt, optimal corn planting dates are believed to be in late April into very early May. Research reveals that corn yields tend to decline as planting moves beyond the optimum window. The declines also tend to accelerate as planting gets later and later. The declines in yield, however, are relative to potential yield. Yield can still be relatively high with late planted corn if the growing season weather is very favorable, but late planted corn would still be expected to have yields below that of corn planted in a timely fashion.

Some corn is planted late every year. For 2011, the questions center on what portion of the crop will be planted late and the degree of lateness. It now appears that areas in the western corn belt will make substantial planting progress in early May. The focus will be on the wet areas in the southern and eastern corn belt and the cool areas of the northern belt.

Most of the intended corn crop will likely get planted, so the most important factor will become summer weather. In 2009, extremely favorable summer weather extended the growing season and more than compensated for planting delays. An examination of weather records, however, reveal that the uniformly favorable conditions of 2009 have been rare.

Uncertainty about consumption and production prospects, along with volatile currency and energy prices, suggest a continued wide trading range for both corn and soybeans.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 12, 2011, 08:54:16 AM
USDA: World Agricultural Supply and Demand Estimates
According to the US Department of Agriculture, this report presents USDA’s initial assessment of US and world crop supply and demand prospects and US prices for the 2011/12 season. Projections reflect economic analysis, normal weather, trends, and judgment. Because spring planting is still underway in the Northern Hemisphere and remains several months away in the Southern Hemisphere, these projections are highly tentative.


WHEAT
The 2011/12 outlook for US wheat is for reduced supplies with lower carryin and production than in 2010/11. Beginning stocks for 2011/12 are down 14 per cent from 2010/11, but remain the second highest in a decade. All-wheat production is projected at 2,043 million bushels, down 7 per cent from 2010/11. The survey-based forecast of winter wheat production is down 4 per cent, as lower expected harvested area and yields in Colorado, Kansas, Oklahoma, and Texas sharply reduce Hard Red Winter (HRW) wheat production. Partly offsetting is higher production of Soft Red Winter (SRW) wheat with a rebound in area and higher forecast yields. Spring wheat production is expected lower despite higher expected planted area for other spring wheat. A return to trend yields from record levels of the previous 2 years is expected to reduce durum and other spring wheat production. US wheat supplies for 2011/12 are projected at 2,992 million bushels, down 9 per cent from 2010/11.

Total US wheat use for 2011/12 is projected down 7 per cent as lower projected exports more than offset higher expected domestic use. Food use is projected at 945 million bushels, up 15 million from 2010/11 as flour extraction rates are expected to decline modestly from their historical highs during the past 3 years and consumption grows slightly driven by slowly rising population. Feed and residual use is projected at 220 million bushels, up 50 million from the 2010/11 projection as higher corn prices and a rebound in SRW production encourage more summer quarter wheat feeding.

US exports are projected at 1,050 million bushels, down 225 million from the 2010/11 projection. Export prospects are sharply diminished with reduced HRW production and increasing competition as Black Sea production and exports are projected to rebound. US ending stocks are expected to continue their decline from the recent high in 2009/10. At a projected 702 million bushels, 2011/12 ending stocks are expected down 137 million from 2010/11 and 274 million below 2009/10. The season-average farm price for all wheat is projected at a record $6.80 to $8.20 per bushel, compared with $5.65 for 2010/11.

Global wheat supplies for 2011/12 are projected 1 per cent higher as a projected 25.9-million-ton increase in foreign production more than offsets lower beginning stocks and the drop in US production. At the projected 669.6 million tons, global production for 2011/12 would be up 21.4 million from 2010/11. A sharp rebound in FSU-12 production, combined with larger expected crops in India, North Africa, Canada, and EU- 27 account for most of the increase in world wheat output for 2011/12.

Global wheat trade is expected higher in 2011/12 with world exports projected up 2 per cent to 127.3 million tons. Increased supplies in Russia, Ukraine, and Kazakhstan and a return to exporting are expected to increase competition for EU-27 and US wheat. A recovery in production and improved wheat quality in Canada is also expected to increase export competition. Global wheat consumption is projected up 8.4 million tons or 1 per cent with increased feeding and food use expected in 2011/12. Global ending stocks for 2011/12 are projected slightly lower on the year at 181.3 million tons, compared with 182.2 million for 2010/11.

COARSE GRAINS
Projected US feed grain supplies for 2011/12 are nearly unchanged from 2010/11 as record production is offset by the smallest beginning stocks in 15 years. Corn production for 2011/12 is projected at a record 13.5 billion bushels, up 1.1 billion from 2010/11 as a 4.0-million-acre increase in intended plantings and a recovery from last year’s weather-reduced yields boost expected output. The 2011/12 corn yield is projected at 158.7 bushels per acre, 3.0 bushels below the 1990-2010 trend reflecting the slow pace of planting progress through early May. The 2011/12 yield is expected to be the third highest on record. Corn supplies for 2011/12 are projected at 14.3 billion bushels. This is below the 2009/10 record of 14.8 billion bushels, but up 75 million from 2010/11, as a 5-million-bushel increase in 2010/11 imports and a 50-million-bushel reduction in 2010/11 exports boost current year carryout this month.

Total US corn use for 2011/12 is projected down 1 per cent from 2010/11. Corn use for ethanol is projected up 50 million bushels reflecting slow expected growth in gasoline consumption and continued export demand for ethanol in the coming year. Domestic corn feed and residual use is projected 50 million bushels lower than in 2010/11 reflecting increased availability of feed by-products from ethanol production and lower expected residual use as compared with the current year. US corn exports for 2011/12 are projected down 100 million bushels from 2010/11 with larger foreign corn supplies. US corn ending stocks for 2011/12 are projected at 900 million bushels, up 170 million from the current year projection. Stocks remain historically tight with stocks-to-use projected at 6.7 per cent compared with the current year projection of 5.4 per cent. The season-average farm price is projected at a record $5.50 to $6.50 per bushel compared with the 2010/11 forecast of $5.10 to $5.40 per bushel.

Global coarse grain production for 2011/12 is projected at a record 1,146.8 million tons, up 6 per cent from 2010/11. A 52.4-million-ton increase in global corn output to 867.7 million tons accounts for 84 per cent of the year-to-year increase in coarse grain production. Foreign corn production is projected up 25.5 million tons with the largest increases expected in Argentina, China, Russia, Mexico, and Ukraine. Global 2011/12 production is raised for barley, oats, and rye, mostly reflecting a recovery in production in Russia. World production for all three crops remains below recent highs as more attractive returns for corn and oilseeds limit area expansion in these traditional coarse grains. Global corn exports are projected higher for 2011/12 with increases for Argentina, Russia, and Ukraine more than offsetting reductions for the United States, Canada, and Brazil. Global corn consumption is projected at a record 860.8 million tons, up 22.2 million from 2010/11, with nearly all of the increase in foreign markets. World corn ending stocks for 2011/12 are projected at 129.1 million tons, up 7.0 million from 2010/11.

RICE
Projected smaller US 2011/12 total rice supplies, combined with a modest decline in total use, results in lower projected ending stocks. US rice production in 2011/12 is projected at 211.0 million cwt, 13 per cent below 2010/11. Planted area in 2011, based on the NASS Prospective Plantings report, is estimated at 3.02 million acres, down 17 per cent from 2010 and the smallest area since 2008. Harvested area is estimated at 3.0 million acres. Average rice yield is projected at 7,033 pounds per acre, up 5 per cent from the previous year’s crop, which was damaged by excessive summer heat. The projected yield is calculated from the 5-year Olympic average (2006/07-2010/11) by rice class. Imports for 2011/12 are projected at 18.0 million cwt, up 3 per cent from the previous year, but below the 2007/08 record.

US 2011/12 total rice use is projected at a 236.0 million cwt, 2 per cent below the previous year’s record level. US domestic and residual use is projected at a near-record 127.0 million, unchanged from 2010/11 as per capita use of rice has shown virtually no growth in recent years. Exports are projected at 109.0 million cwt, 5 per cent below revised 2010/11 exports. Despite an expected increase in global trade, competition for key markets will be keen as US and competitor supplies are expected to be large. US ending stocks in 2011/12 are projected at 48.6 million cwt, 13 per cent below the previous year. Ending stocks of long-grain and combined medium- and short-grain rice are 32.8 and 14.4 million cwt, respectively (unclassified broken rice totals 1.4 million cwt).

The average milling yield used for 2011/12 is 70.75 per cent. It is based on the 2007/08-2009/10 average milling rate calculated from data supplied by the USA Rice Federation in its monthly rice stocks reports. The 2010/11 market year is excluded from the calculation because milling yields are well below average, largely the result of unfavorable weather.

The US 2011/12 long-grain rice season-average farm price is projected at $11.00 to $12.00 per cwt compared to a revised $11.00 to $11.30 for the previous year. The combined medium- and short-grain price is projected at $15.00 to $16.00 per cwt, compared to a revised $16.85 to $17.15 for the year earlier. The 2011/12 all rice price is projected at $12.00 to $13.00 per cwt, compared to a revised $12.35 to $12.65 per cwt for 2010/11. Large domestic and global supplies and expected lower Asian prices will pressure US prices in 2011/12.

Global 2011/12 total supply and use are each projected to reach record levels at 554.9 and 458.7 million tons, respectively, resulting in a modest decline in world ending stocks. Global 2011/12 rice production is projected at a record 457.9 million tons, up 6.6 million or 1.5 per cent from 2010/11. Large crops are projected for most of Asia including record or near-record crops in Bangladesh, Burma, Cambodia, Indonesia, the Philippines, Thailand, and Vietnam. In contrast, rice crops in many Western Hemisphere nations including Argentina, Brazil, Peru, the United States, and Uruguay are forecast lower than the previous year. Global 2011/12 consumption (which includes residual) is projected at a record, led by increases for Bangladesh, Cambodia, China, Laos, Pakistan, Sri Lanka, and Thailand. Global exports in 2011/12 are projected at a marketing-year record 32.2 million tons, up 0.8 million from 2010/11 with increases expected for India, Pakistan, and Vietnam, while exports from the US, Cambodia, and Brazil are expected to decline. Larger imports are projected for Middle Eastern, Sub-Saharan Africa, and Western Hemisphere markets, although the expected increases are slight. Global ending stocks are expected to decline 0.9 million tons from 2010/11 to 96.2 million. The stocks-to-use ratio for 2011/12 is calculated at 21.0 per cent, down from last year's 21.6 per cent.

OILSEEDS
US oilseed production for 2011/12 is projected at 99.0 million tons, down 1 per cent from 2010/11. Reduced soybean production accounts for most of the decline, but sunflowerseed, canola, and peanut production are all projected below last year’s crops. Soybean production is projected at 3.285 billion bushels, down 44 million from the 2010 crop mostly due to lower harvested area. Soybean yields are projected at a trend level of 43.4 bushels per acre, down 0.1 bushels from 2010. Soybean supplies are projected at 3.47 billion bushels, down less than 1 per cent from 2010/11 as larger beginning stocks partly offset lower production. Soybean ending stocks for 2010/11 are projected at 170 million bushels, up 30 million from last month due to reduced exports.

Soybean crush for 2011/12 is projected at 1.655 billion bushels, up fractionally from 2010/11 as a lower extraction rate offsets reduced total soybean meal demand. Lower soybean meal export demand projected for 2011/12 is only partly offset by a small increase in domestic soybean meal use, leaving total soybean meal use down 1 per cent from 2010/11. Domestic soybean oil consumption is projected to increase 7 per cent mostly due to biodiesel production gains. Soybean oil used for biodiesel production is projected at 3.5 billion pounds, up 1 billion from 2010/11 reflecting a higher biodiesel use mandate.

With lower 2011/12 US soybean supplies and higher South American soybean supplies on hand this fall, US soybean exports are projected at 1.54 billion bushels, slightly below the 2010/11 level despite a projected increase in global import demand led by China. Ending stocks for 2011/12 are projected at 160 million bushels, down 10 million from 2010/11, leaving the stocks-to-use ratio at 4.8 per cent. The US season-average soybean price for 2011/12 is projected at $12.00 to $14.00 per bushel compared with $11.40 per bushel in 2010/11. Soybean meal prices are forecast at $350 to $380 per short ton, compared with $350 per ton for 2010/11. Soybean oil prices are projected at 56 to 60 cents per pound compared with 53.5 cents for 2010/11.

Global oilseed production for 2011/12 is projected at a record 459.2 million tons, up 2.2 per cent from 2010/11. Global soybean production is projected to increase less than 1 per cent to 263.3 million tons. The Argentina crop is projected at 53 million tons, up 3.5 million from 2010/11 crop based on a higher harvested area and yields. The Brazil soybean crop is projected at 72.5 million tons, down 0.5 million from the projected record 2010/11 crop. A 3 per cent increase in harvested area is more than offset by a return to trend yields. China soybean production is projected at 14.8 million tons, down 0.4 million from 2010/11 due to lower area and yields. Higher rapeseed production for Canada, Australia, China, and Ukraine more than offsets lower production for EU-27. For sunflowerseed, production gains for Russia, Ukraine, and EU-27 more than offset reduced production in Argentina. Led by gains in global oilseed production, 2011/12 WASDE-494-4 oilseed supplies are up 2.4 per cent from 2010/11. With global crush projected to increase 3.5 per cent, global oilseed stocks are projected to decline 1.5 million tons to 72.2 million.

Global protein meal consumption is projected to increase 3.6 per cent in 2011/12. Protein meal consumption is projected to increase 7.8 per cent in China, accounting for 54 per cent of global protein consumption gains. Global soybean exports are projected at 98.7 million tons, up 2.8 per cent from 2010/11. China soybean imports are projected at 58 million tons, up 3.5 million from 2010/11. Global vegetable oil consumption is projected to increase 3.5 per cent in 2011/12, led by increases for China, India.

SUGAR
Projected US sugar supply for fiscal year 2011/12 is down 5 per cent from 2010/11. Lower imports more than offset higher beginning stocks and production. Beet sugar production is unchanged and reflects trend yields, while cane sugar production increases with a rebound in Florida. Imports under the tariff rate quota (TRQ) reflect the minimum of US commitments to import raw and refined sugar and projected shortfall. The Secretary will establish the TRQ at a later date. Imports from Mexico are sharply lower due to reduced supplies and increased domestic use in Mexico. Total use is up less than 1 per cent. Mexico’s 2011/12 sugar supply is down 3 per cent with lower beginning stocks and imports more than offsetting higher production. Production is projected to increase due to improved cultivation of sugarcane in Mexico. Imports reflect mainly US exports. Domestic sugar consumption is up, reflecting flat demand for corn-based sweeteners in the soft drinks sector. Exports decline, assuming reasonable ending stocks. For 2010/11, the major change from a month ago is higher US imports following the announced increase in the TRQ and a stronger-than-expected pace of imports from Mexico.

COTTON
The US cotton projections for 2011/12 include lower supplies and offtake relative to last season, resulting in higher ending stocks. With beginning stocks sharply lower than 2010/11, production is projected at 18.0 million bales, reducing the total supply. Projected production is based on planted area from the March Prospective Plantings, combined with above-average abandonment and slightly belowaverage yields due to severe drought conditions in the Southwest. Domestic mill use is projected at 3.8 million bales, the same as 2010/11, while exports are reduced due to lower US supplies and increased foreign production. Ending stocks are projected at 2.5 million bales, 43 per cent above 2010/11, but still the second-lowest level since 1990/91. The forecast range for the average price received by producers is a record 95.0 to 115.0 cents per pound.

The initial world cotton projections for 2011/12 show a sharp increase in production to a record 124.7 million bales, with India, China, and Pakistan accounting for 70 per cent of the increase. A partial easing of supply constraints, combined with projected world economic growth, is anticipated to raise consumption 3.0 million bales, above the 3 preceding years but below the peak levels of 2006/07 and 2007/08. World trade is projected at 40 million bales, mainly reflecting higher import demand by China. World ending stocks are projected to rise to nearly 48 million bales, a 13-per cent increase from the beginning level; however, the stocks-to-consumption ratio of 40 per cent remains relatively tight.

For 2010/11, US production is virtually unchanged from last month, reflecting the final season estimate. Domestic mill use is raised 100,000 bales to 3.8 million, based on indications of higher-than-expected use from Farm Service Agency data. Exports are reduced 250,000 bales as the pace of export sales has fallen sharply over the past month. Ending stocks are now forecast at 1.75 million bales.

Estimated world production for 2010/11 is unchanged from last month, as an increase of 1.0 million bales for China is offset by a like decrease for India. World consumption is reduced, due mainly to reductions for India and Pakistan. China’s imports are lowered 1.5 million bales due to a recent fall-off in demand, which is partially offset by increased imports for Pakistan and Turkey. World ending stocks are raised nearly 1.0 million bales.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 30, 2011, 12:36:31 AM
Friday, May 27, 2011
April Soybean Crush Smallest Since 2004
US - Two weeks ago, the USDA lowered the projection of 2010-11 marketing year exports of US soybeans by 30 million bushels, to a total of 1.55 billion bushels, writes University of Illinois economist, Darrel Good.


The reduction resulted in a projection of marketing year ending stocks of 170 million bushels, or 5.1 per cent of projected consumption. That is a more comfortable level of stocks than the previous projection of 4.2 per cent of consumption.

The projection of the marketing year domestic crush of soybeans was unchanged at 1.65 billion bushels, 102 million (5.8 per cent) less than the crush during the previous year. For the past two months, we have chronicled the pace of the domestic crush as estimated by the Census Bureau. The April 2011 crush estimate was released today and revealed a continuation of a very slow pace of crush (figure 1). [Note: The Census Bureau estimates for April are reported as released. Revision in some estimates may be required since calculations of combined meal and oil production per bushel of soybeans crushed during the month exceeded 60 pounds.] The April crush was estimated at 128 million bushels, 7.1 million bushels (5.2 per cent) fewer than crushed in April 2010 and the smallest crush for the month since 2004. The monthly crush has been below 128 million bushels only 3 times since September 2004. Those low totals occurred in either August or September. Cumulative crush for the marketing year to date (September 2010-April 2011) totalled 1.143 billion bushels, 89 million (7.2 per cent) below the total of the previous year.


The slow pace of the domestic crush so far this year reflects a combination of higher product yield per bushel of soybeans crushed and (mostly) a slow-down in soybean meal consumption. Soybean meal consumption during the period September 2010 through April 2011 was 6.4 per cent less than during the same period in the previous year. The largest decline, 22 per cent, was in the export market, as a rebound in South American soybean production has provided more competition for US soybean meal. Consumption of US soybean oil during the same period was about two per cent below that of the previous year. Month-end soybean oil stocks remain large even as the soybean crush and resulting soybean oil production have declined. Stocks at the end of April were marginally smaller than stocks of a year earlier (figure 2). Stock levels below those of a year ago may continue through the end of the marketing year since stocks were very large, at least through July, last year. The USDA projects year-ending stocks to be 885 million pounds (26 per cent) smaller than stocks at the beginning of the year.


To reach the USDA crush projection for the year, crush during the final four months of the marketing year needs to total 507 million bushels, only 13 million less than during the same period last year. Crush during those four months last year was relatively small so that the projection for this year may still be achievable. A monthly rate of about 127 million bushels will be required.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 03, 2011, 09:24:25 AM
Thursday, June 02, 2011
CME: Sharp Pullback in Grain Markets
US - Grain markets pulled back sharply on Tuesday following reports over the weekend that Russia would lift wheat export restrictions, which have been in place since last summer, write Steve Meyer and Len Steiner.


Trade reports indicate that feed wheat values in the Black Sea region are currently priced below US corn prices and in the short term this is seen as negative for US corn exports. The pullback may be short lived, however, given the many challenges facing US corn and soybean production this year.


Below are some of the issues:

Some major corn production areas remain behind in plantings and some acres may not be planted at all. The latest crop progress report showed just 19 per cent of the corn crop in Ohio had been planted as of 29 May. The plantings report in March indicated Ohio farmers would plant 3.7 million acres of corn, or 4 per cent of the national acreage. Farmers there have only a few days before making some critical decisions as to whether to abandon plantings and opt for preventive planting insurance. Regardless, the production prospects out of this area are significantly worse than they were back in April. Overall, the latest crop progress report showed that just 86 per cent of the crop acres had been planted as of 29 May compared to 97 per cent a year ago.


There is significant risk of flooding in areas along the Missouri river in South Dakota, Northern Iowa, Nebraska. News reports indicate that the Army Corps is planning to relieve pressure on dams by flooding farmland and this could lead to more lost acres, similar to what happened in the Mississippi Delta. While the estimates of the number of acres that could be flooded vary, it is one more issue that one needs to consider when estimating corn crop supplies that will come to market this fall.


And if producers up North are having to deal with the effects of melting snow and excessive rainfall, producers in the Southern states are coping with one of the worst droughts in the last seventy years. Many areas in Texas are experiencing exceptional drought conditions and this will negatively impact corn and wheat supplies coming from there. USDA issued its first crop condition report on Tuesday and overall it showed that 6 per cent of the national corn crop currently in the ground is in poor/very poor condition, 2 points higher than the comparable period a year ago. However, 31 per cent of the corn crop in Texas was rated as poor/very poor. The corn plantings survey in March pegged Texas corn acres at 2.15 million acres, about 2 per cent of the national crop. The winter wheat condition in Texas and surrounding areas is even worse. The crop progress report showed that 76 per cent of the wheat crop in Texas is in poor/very poor condition, compared to just 9 per cent a year ago. Spring wheat plantings are also very behind and this will tend to lift the overall grain complex.
Bottom line: The fact that Russia lifted its export ban may have provided a bit of relief for grain prices but exceptionally tight US corn supplies and production challenges on many fronts will likely cause the market to maintain significant risk premiums in place, impacting US livestock and poultry production for the remainder of 2011 and in 2012.



Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 10, 2011, 09:17:20 AM
Thursday, June 09, 2011P
CME: Output of Sorghum, Barley & Oats Falling
US - Output levels for sorghum, barley and oats have been falling for many years, write Steve Meyer and Len Steiner.


In response to our discussion yesterday regarding dried distillers grains with solubles (DDGS), the major by-product of corn ethanol production, our friend Dr. Tom Elam of FarmEcon LLC sent a note urging us to also consider the other three major feed grains – grain sorghum, barley and oats. Dr Elam wrote: 'Corn acres have grown at the expense of the other three feed grains, and not by a little bit. When you look at total feed grains + DDGS feed use the trend is down, not flat.' The authors says they were aware of this impact of increasing corn acres but did not have the space to discuss the issue in the previous edition – so they address the topic now.

As can be seen in the graph below, the output levels for these three 'other feed grains' has been falling for many years. Barley output in 2010 was less than half the level of 1990. Oats output was only 27 per cent as large as it was in 1990 and sorghum production was 40 per cent lower than in 1990. Total sorghum, oats and barley output in 2010 was only 45 per cent as large as the production of those three grains in 1990.


And, while the rate of decline has slowed, the acreage and production levels for these three grains have fallen since 2003 – the beginning of the nine-year period that they mentioned in the previous DLR as being a period of flat corn + DDGS availability for livestock and poultry feeders. In fact, the total acres planted to these crops has fallen from 19.365 million in 2003 to just 11.414 million in 2010. Production has fallen from 833.885 million bushels to only 606.863 million bushels during that same time period. USDA has projected that the total acres planted to these three crops will grow this year by 22,000 to 11.436 million.

Will the meat/poultry complex finally see a respite from the production and price pressure of the US broiler sector soon? Recent USDA data for the number of broiler-type chicken eggs placed in incubators certainly suggest that is possible. Egg sets have been between 0.3 per cent and 2.2 per cent lower than one year ago over the past four weeks. It is the first string of four weeks in which egg sets have fallen relative to one year earlier since the last two week of 2008 and first two week of 2009. After robust growth of 3.3 per cent in 2010, total US egg sets are up only 0.3 per cent year-to-date in 2011.


These lower sets should show up as lower placements in the next two to three weeks and those placements should show up as fewer birds slaughtered five to seven weeks past that point. The exact timing depends on which type of bird is seeing reduced output. Today's 'meat chickens' are divided between two pretty distinct sub-sectors – the small birds that are primarily processed into chicken parts for food-service and the big birds (7-9lbs) that are boned out to produce boneless chicken products. Heavier weights imply a changing product mix rather than longer feeding as is frequently the case in the pork and beef industries.

A reduction in broiler output would be good news for everyone, say the authors, including the companies producing broilers. Retail chicken prices have held very close to year-ago levels in recent months while beef and pork have set new record highs. The low relative price of chicken has been a drag on beef and pork demand and low wholesale chicken prices have had broiler margins in the red since last fall. Some companies may be able to stand such losses but some cannot and most observers believe more consolidation is on the way in the broiler sector.

How many crop acres have been lost due to wet conditions and flooding? That is a common question we are hearing at this week's World Pork Expo in Des Moines. Dr Robert Wisner of ISU provided a summary of anecdotal evidence to a meeting earlier this week. NDSU reports two million acres of prevented planting in North Dakota. Missouri had 570,000 acres flooded before the coming Missouri River flood. Mississippi estimates it has lost 600,000 acres while Louisiana has lost 280,000 of crop land. Another 500,000 were listed for Illinois and as much as one million acres are estimated lost in Arkansas. Then add 450,000 of corn and 350,000 of beans in the Missouri Valley from South Dakota through Missouri.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 14, 2011, 07:47:07 AM
Monday, June 13, 2011
CME: Lower Harvested Corn Acres Expected in 2011
US - The latest USDA supply/demand estimates are getting a lot of coverage in the press, and for good reason, write Steve Meyer and Len Steiner.


Normally USDA does not change its estimates of the acres planted in its June report (although it has happened before) as it waits for the results of the June acreage survey. The results of that survey will be published on 30 June in the Acreage report. There has been enough information on planting delays and flood damage that USDA felt compelled to adjust its supply calculations for the upcoming corn crop. The most recent estimate puts planted corn acres at 90.7 million, 1.5 million acres less than the May estimate but still 2.5 million acres higher than a year ago. It is also important to note that USDA increased the abandonment rate as evidenced in the number of acres harvested.


Last year, the ratio of harvested to planted acres was 92.3 per cent and that ratio was used in the May estimates. However, damage due to flooding is expected to lower the ratio to 91.7 per cent. Consequently, harvested acres this fall are expected to be about 1.9 million acres less than a year ago. This revision in planted and harvested acres removed 305 million bushels from the expected corn output from the upcoming harvest. In previous years, such a change would be notable. Given that we are expected to start the year with minimum pipeline supplies, this revision in output is seen as potentially explosive for new corn crop prices.

While the current revisions provided a jolt to the market and caused corn futures to hit record highs on Thursday (futures were slightly lower in overnight trading), we will have to wait for the June Acreage report to get a better sense as to the size of the crop farmers put into the ground this spring, the authors write. USDA did not make any changes as to the expected yields for the upcoming crop. While there is a lot of concern about corn yields from areas that were planted late (ECB), many states in the WCB are seeing very good corn crop conditions. In the latest report, USDA rated 81 per cent of the Iowa corn crop in good/excellent condition. With plenty of risk already built into the market, and plenty of weather events, USDA likely decided to defer on the yield issue until the crop condition picture becomes clearer.


On the demand front, USDA decided to lower feed use by 100 million bushels, reflecting profitability issues in livestock and poultry industry and expectations for lower meat production in late in 2011 and 2012. Corn exports and ethanol demand were left unchanged. Higher energy prices and tight world corn supplies remain long term bullish for corn prices and will further pressure already razor thin pipeline supplies. The export issue is particularly critical. Trade likely noted that USDA changed how it calculates China corn use, raising expected China corn consumption 8 per cent from previous estimate. World corn stocks at 111.89 million MT now 13 per cent less than May estimate and 22 per cent lower than in 2009/10.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 20, 2011, 11:36:49 AM
Feed Outlook – June 2011
US corn production is still expected to be a record this year but the current forecast is for historically tight global coarse grain stocks, according to the latest report from the USDA Economic Research Service.
 

US corn production for 2011/12 is projected 305 million bushels lower this month at 13,200 million as delayed planting this spring are expected to reduce plantings 1.5 million acres from producer intentions. Flooding on the Mississippi and Missouri Rivers is also expected to reduce harvested area.

Production is still expected to be a record but ending stocks are reduced this month by 205 million bushels, resulting in a year-to-year decline of 35 million bushels. Tight supplies are reflected in higher price projections for all feed grains. Revisions to several years of China’s corn supply and demand increase use more than production, tightening stocks.

Global coarse grain ending stocks projected for 2011/12 are reduced 11 per cent this month. The global stocks-to-use ratio for coarse grains is projected at 12.6 per cent, the lowest since 1973/74 when it fell to 12.2 per cent. Near-term trade implications, however, are limited with 70 per cent of this month’s global stock decline in China.


DOMESTIC OUTLOOK

US Feed Grain Supplies Projected Sharply Lower this Month
Reduced prospects for corn acreage lowered projected US feed grain production for 2011/12 by 7.7 million metric tons. Production for 2011/12 is projected at 348.3 million tons. Total use is 2.5 million tons below last month’s projection as higher prices reduce prospects for feed and residual use. Ending stocks are projected sharply at 20.7 million tons, a 5.3-million-tons decrease of lower than last month from May’s estimate and the lowest level since the 1995/96 crop year.

Feed and residual use for the four feed grains plus wheat, on a September-August marketing year basis, is lowered 3.7 million tons to 138.0 million. Grain-consuming animal units (GCAUs) for 2011/12 are projected unchanged from last month at 94.2 million compared with 92.7 million in 2010/11.

Projected 2011/12 feed grain exports are increased slightly to 49.4 million tons, compared with 49.3 million last month, on higher projected sorghum shipments.

Planting Delays and Flooding Reduce Projected Harvested Area and Production for Corn
Planting delays in the eastern Corn Belt, especially Ohio and Indiana, and in the Northern Plains are expected to reduce planted area, offsetting potential gains in the western Corn Belt and central Plains. Planted area is reduced 1.5 million acres as some of this land is expected to remain too wet to plant to corn. Harvested area is lowered 1.9 million acres to 83.2 million, reflecting early assessments of May flooding in the Mississippi and Ohio River valleys, and June flooding along the Missouri River valley. Production is projected 305 million bushels lower at 13,200 million, but is still a record. This month’s yield projection is unchanged at 158.7 bushels per acre because the crucial July and August weather that will determine yields remains unknown.

Feed and residual use for 2011/12 is projected 100 million bushels lower this month. Higher prices for corn are expected to ration demand for feed use. Feed use is projected at 5,000 million bushels for the marketing year, compared with 5,150 for 2010/11. Projected food, seed and industrial use for 2011/12 is unchanged at 6,455 million bushels, 55 million higher than 2010/11. Ethanol production, mostly using corn as a feedstock, continues to advance, according to weekly Energy Information Agency data. As the share of corn that is not forward contracted at favorable price declines, margins will decrease, although higher petroleum prices may be an offsetting factor.

The lower feed and residual projection reduces projected corn use for 2011/12 to 13,255 million bushels, 195 million bushels below 2010/11.

The sorghum export projection for 2011/12 is increased from 130 million bushels to 135 million. Shipments to Mexico are expected higher due to tight corn supplies.

Feed and Residual Use Down in 2011/12
The 2011/12 US feed and residual use for the four feed grains plus feed wheat on a (September-August) projected at 138.0 million tons, down 3.7 million tons from the previous year. Feed and residual use per grain-consuming animal unit (GCAU) is projected at 1.48 tons in 2011/12, compared with 1.53 tons in 2010/11. Total GCAUs are projected up 1.6 per cent on the year to 94.2 million. GCAUs are expected to be up for the year because of increased poultry and pork production as demand begins to strengthen offset by lower cattle numbers. Feed and residual use per animal unit is reduced this month to 1.48 tons as lower expected feed use more than offsets the decline in GCAUs.

Projected Ending Stocks Slip on Production Decline
Lower projected feed grain production in 2011/12 more than offsets the decline in feed use, reducing projected ending stocks to 695 million bushels, the lowest since 1995/96. The projected stocks-to-use ratio falls to 5.2 per cent, compared with 5.4 per cent forecast for 2010/11. The stocks-to-use ratio at the end of 1995/96 was 5.0 per cent. A stocks-to-use ratio at 5.0 per cent may represent minimal ‘pipeline’ stocks, however, significant changes in grain storage, handling and transportation have occurred since 1995/96. Among the most important have been changes associated with expansion of corn processing to produce ethanol.

Higher Feed Grain Prices Projected
The season-average corn farm price for 2011/12 is projected at a record $6.00 to $7.00 per bushel, up $0.50 on both ends of the range from last month. Tight supplies caused by reduced acreage and lower carry-in prompted the increase. The projected corn price for 2010/11 is boosted $0.10 on each end of the range to $5.20- $5.50 per bushel.



Projected 2011/12 sorghum prices are expected to be record high. This month’s forecast is increased by $0.60 on both ends of the range to $5.60 to $6.60 per bushel. Projected barley prices are raised $0.20 on both ends of the range to $5.95- $7.05 per bushel. The increase in the oats projected price is larger, up $0.30 on both ends of the range to $3.60-$4.20 per bushel.

Weekly Crop Progress Report Shows Gains
The Crop Progress report issued by USDA’s National Agricultural Statistics Service for the week ended 5 June 2011, showed further progress in the major corn States as farmers sowed eight per cent of the crop in newly-dried fields over the preceding week. As of 5 June, 94 per cent of the crop was planted compared with the 2006-2010 average of 98 per cent. Indiana and Ohio remained significantly behind normal at 82 and 58 per cent, respectively, compared to five-year averages of 94 and 99 per cent. Producers in Illinois, Iowa, Kansas, Missouri and Nebraska have planted 98 per cent or more of their corn crops by 5 June.


INTERNATIONAL OUTLOOK

Global Coarse Grain Production Cut as US Drop Bigger than China Increase
World coarse grain production in 2011/12 is projected to reach 1,143.9 million tons, down 3.0 million this month. US corn production, down 7.7 million tons, has the largest drop, but a 6.0-million-ton increase for China’s corn, and a few adjustments to other countries, leave global corn production down 1.6 million tons this month to 866.2 million. World barley production is reduced 1.2 million tons to 130.3 million as EU prospects deteriorate.

China’s corn production increase for 2011/12, up 6.0 million tons to 178.0 million, is based on an increase in area reported by China’s National Bureau of Statistics (NBS) for 2010/11. The 2010/11 production is increased 5.0 million tons to 173.0 million, adopting the NBS corn area but remains below the NBS production estimate because USDA analysis indicates that since 2009/10 NBS has overestimated China’s corn yields. The projection for China’s 2011/12 corn crop assumes an increase in corn area of two per cent, down from the four per cent growth reported for the previous year. USDA’s corn yield for China is not changed this month for 2010/11 or 2011/12.

Coarse grain production prospects increased this month for Ukraine, up 0.6 million tons to 24.9 million tons. Spring weather has had enough rain to maintain adequate soil moisture in most regions, without excessive rains to disrupt fieldwork. Planting reports indicate more corn area seeded than expected, boosting corn production prospects 0.5 million tons. There is also a small increase in millet area based on plantings.


Russia’s coarse grain production is increased slightly this month to 28.9 million tons, reflecting variable planting conditions. In the Southern District and the Caucasus, spring plantings have gone well but in the Volga, cold temperatures and spotty dryness delayed plantings. Barley area planted is larger than expected, boosting production prospects 1.0 million tons to 14.5 million. However, the pace of corn seedings appears to be too slow to reach the previously expected area, so corn area is cut this month, trimming production prospects 0.5 million tons to 6.0 million. Rye area is also reduced this month, cutting expected output 0.3 million tons to 3.0 million.

Zambia reports expanded corn area, boosting production 0.5 million tons to 3.0 million. Argentina is expanding area planted for winter barley, increasing production prospects 0.3 million tons to 2.5 million.

European Union (EU) coarse grain production prospects are down 2.2 million tons this month to 143.0 million. The entire decline is based on barley yields. A few EU countries reported slightly increased barley area this month. Severe spring dryness centered in northern France extended into Germany, parts of the UK and western Poland. Harsh winter conditions in parts of Germany and Poland may also have reduced crop potential.

Canada’s barley production expected in 2011/12 is reduced 0.3 million tons to 8.2 million as southeastern Saskatchewan and southwestern Manitoba have been too wet for planting, reducing barley area.

Moldova reported corn area plantings down compared to the previous year, trimming production prospects 0.3 million tons to 1.2 million. Kyrgyzstan reported a slight dip in barley area and production prospects.


Reduced China Corn Beginning Stocks Trim 2011/12 Supplies
Estimated corn use for China for 2007/08 through 2010/11 is increased this month, enough to more than offset the five million ton increase in 2010/11 production, and leave 2011/12 beginning stocks down 5.0 million tons to 53.7 million. Numerous small adjustments to 2011/12 beginning stocks for other countries are mostly offsetting, leaving global coarse grain stocks down 4.9 million tons at 153.5 million. With world coarse grain production down 3.0 million tons this month, global supplies are down 7.8 million.

Global Coarse Grain Demand Prospects for 2011/12 Boosted This Month
World coarse grain use projected for 2011/12 is up 9.3 million tons this month to 1,152.1 million tons. Corn total use is up 11.0 million tons to 871.7 million, while barley is down 1.4 million to 132.8 million. Projected use of rye and sorghum are down fractionally as well.

Corn use in China for 2011/12 is raised 13.0 million tons this month to 181 million. Feed and residual use is projected to reach 126.0 million tons, up 10.0 million this month, but only five per cent higher than the revised forecast for 2010/11. Corn feed use growth is faster in recent years than the reported growth in some key livestock indicators such as pig meat production but remains slower than the apparent growth in use of soybean meal. Food, seed and industrial use in China is up 3.0 million tons this month to 55.0 million. That represents six per cent growth compared to the revised forecast for 2010/11 but is much slower growth than estimated between 2009/10 and 2010/11. China’s Government has announced several measures to slow the growth in use of corn for industrial use. China’s barley use (beer) is reduced 0.2 million tons this month, reflecting high prices and lower projected imports.

Russia’s 2011/12 coarse grain use is boosted 0.7 million tons this month. Barley feed use is up 1.0 million and rye use cut 0.3 million reflecting production changes.

Saudi Arabia’s barley feed use is cut 0.5 million tons this month as satellite imagery confirms exceptionally good winter and spring pastures, and the pace of imports has slowed. There are smaller changes to coarse grain use this month for Moldova (reduced corn production), Jordan, Canada, Ukraine and Uruguay.

EU total coarse grain use is projected unchanged this month but feed use is up 0.5 million tons. Corn imports and feed use are raised 1.0 million tons each, but with reduced barley production, the feed use and food use are each cut 0.5 million tons.

World Coarse Grain Ending Stocks Cut Dramatically This Month
Global coarse grain ending stocks for 2011/12 are slashed 17.1 million tons this month to 145.3 million. Foreign stocks are projected down 11.8 million tons, with the China reduction of 12.0 million tons dominating. The revisions to China’s use over several years are much greater than the increases in production, drawing down stocks prospects considerably. These tighter stocks reflect corn price developments in China. While corn stocks are not dropping significantly year-to-year, the rapid increase in use implies an important tightening in the stocks-to-use ratio, supporting corn prices.

Changes in projected 2011/12 ending coarse grain stocks for other countries are mostly small and offsetting. Increased corn production boosts Zambia’s ending stocks 0.3 million tons, and the EU, Philippines and Australia are each up 0.2 million. Ukraine’s corn stocks are reduced 0.5 million tons due to strong export prospects, and Saudi Arabia’s ending stocks are reduced 0.3 million due to the slow pace of barley imports. There are several smaller, mostly offsetting revisions to projected ending stocks.

The world coarse grain ending stocks forecast for 2011/12, at 145.3 million tons, are similar to the 141.2 estimated for 2006/07 and 143.3 for 2003/04. These are the lowest in recent decades. However, because of increased use, the 2011/12 stocks represent only 12.6 per cent of use, while in 2006/07 they were 13.9 per cent and in 2003/04, 15.2 per cent. So the current forecast is for historically tight global coarse grain stocks; however, 70 per cent of this month’s reduction in global stocks is projected for China where stocks remain at 27.3 per cent of use limiting broader near-term trade implications.


Corn Trade Projected Slightly Higher, US Export Prospects Unchanged
Global corn trade for 2011/12 is projected to reach 92.5 million tons, up 0.7 million this month. The EU, with reduced wheat and barley production, is expected to import more corn to maintain meat production. EU corn imports are forecast up 1.0 million tons this month to 5.0 million.

With increased production prospects and strong demand from EU, Ukraine’s corn export prospects are boosted 1.0 million tons to 7.5 million. Zambia, with increased production, is expected to export to neighbouring countries, boosting exports 0.2 million tons. However, reduced production prospects are expected to limit Russia’s corn exports, down 0.5 million tons this month to 0.5 million.

World corn trade forecast for 2010/11 is unchanged this month at 92.9 million tons. Mexico’s corn imports are reduced 1.0 million tons to 8.0 million as the pace of purchases has been slower than expected, especially given the reduced production. This is partly offset by increased corn imports for the EU, up 0.5 million tons to 7.0 million, as the pace of purchases has been strong.


US sorghum export prospects for 2011/12 are increased 0.2 million tons to 3.5 million – up 5 million bushels to 140 million for the local marketing year. Mexico’s import prospects are increased the same amount as tight corn and sorghum supplies in Mexico are expected to encourage purchases of US sorghum.

World barley trade for 2010/11 and 2011/12 is forecast down significantly this month and is the lowest in 14 years. The 2011/12 global barley trade (October-September) is projected down 1.1 million tons this month to 13.2 million. Tight supplies in the EU and Canada are expected to limit trade. EU export prospects are down 1.0 million tons this month to 1.5 million. The pace of EU shipments in 2010/11 has been slower than expected, trimming the export forecast 0.6 million tons to 4.0 million. Barley imports by Saudi Arabia are forecast sharply lower at 5.4 million tons for 2010/11 and 5.2 million for 2011/12. Saudi Arabia appears content to reduce its stocks instead of increasing import subsidies.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 25, 2011, 07:31:08 AM
Friday, June 24, 2011
Got Low-Quality Wheat? Use It as Animal Feed
US — As some farmers face the probability of low-quality wheat this growing season — in some cases below quality standards for milling — they may need to look for alternative markets for their crop.
 

One option is to use it as animal feed, but several factors need to be considered before incorporating this wheat into livestock diets.

Stephen Boyles, an Ohio State University Extension beef specialist, said that as a general rule mold-free wheat can be used to substitute up to 50 per cent of the grain portion of finishing diets for cattle.

“While some experienced feeders have used larger amounts of wheat, I tend to recommend lower levels to people not familiar with feeding wheat,” Boyles explained. “When feeding lower-quality wheat, limit wheat to 40 per cent of dry matter or 50 per cent of corn in the diet, whichever is highest. Also, you should take longer to build up to full feed than you would with corn, and carefully monitor consumption. I would not recommend using wheat in high-grain diets on self-feeders or in creep rations. Salt (7-12 per cent) might be used as an intake inhibitor for cattle on grass using a self-feeder.”

Wheat Processing Is Important
The way wheat is processed is also important. Boyles said that although the kernel must be cracked or broken, over-processing will result in the production of many fine particles that are undesirable, since the rate of wheat starch digestion in the rumen is very rapid. An excessive amount of fine particles will cause generally low and erratic intakes, digestive upsets, and poor performance.

“Rolling rather than grinding generally results in fewer fine particles,” Boyles said. “If wheat is dry-rolled, it should be rolled or ground as coarsely as possible while still breaking all the kernels. Steam-flaking wheat can improve animal performance. Mixing grains should occur after grain processing rather than before. Mix wheat with silage, haylage or corn grain to reduce the risk of animals eating too much at one time.”

Feeding Wheat to Cattle
There are a few problems associated with feeding wheat to cattle, Boyles warned. For example, when feeding high-concentrate rations, it is not advisable to change back and forth from wheat to other feed grains.

Additionally, since wheat is a fast-fermenting grain in the rumen, problems of depressed feed intake, acidosis and abscessed livers have been reported. That’s why it’s crucial to limit the amount of wheat in the ration, mix it with other grains, and feed animals at least 15 per cent roughage – making sure rations contain approximately 6-10 per cent fiber.

“Buffering agents are added to overcome the problems of reduced feed intake when high-wheat rations are fed to cattle,” Boyles said. “Adding 3.5 ounces of sodium bicarbonate (baking soda) per head daily gives a slight improvement in performance of steers on wheat rations. A finely ground feed-grade limestone can also serve as a buffer. Adding an additional 1-1.3 per cent of finely ground feed-grade limestone to wheat rations may give a slight improvement to performance of cattle. However, avoid increasing the calcium levels of the ration above 0.9 percent.”

Be Careful of Mycotoxin Poisoning
What about sprouted wheat or grain infected by head scab or vomitoxin? Boyles said sprouting does not appear to affect the nutritional value of wheat, but those feeding this grain to cattle must be aware that mold and fungal infestations are more likely with sprouted wheat — and feeding moldy wheat to livestock must be avoided to prevent mycotoxin poisoning.

Meanwhile, the occurrence of scab in wheat does not automatically mean vomitoxin is present, but high levels of scabby kernels in harvested grain should raise red flags. If molds or toxins are suspected, the best thing to do is to have the wheat tested.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 25, 2011, 07:32:33 AM
Thursday, June 16, 2011
Significant Drop in Wheat and Oilseed Yields Forecast
UK - Wheat and oilseed rape yield is likely to be significantly down on the five year average, according to NFU members in a survey run between May and early June this year.

National analysis of the survey was weighted to include crops grown in areas where less crop damage had been reported.

With very poor growing conditions, particularly in the east, results suggest that average English wheat yield in 2011 will be down by 14 per cent to around 6.5 tonnes per hectare (ha), which would rank among the lowest since the late 80s.

Area planted is currently thought to be similar to last year but wheat production in England for 2011 may be much lower due to some severe drought pressure on crops this spring. Based on analysis of these farmer estimates, production could be down on the five year average by around two million tonnes to below 12 million tonnes (mt) or 15 per cent below the five year average of 13.738mt.

Winter oilseed rape appears to be in a slightly stronger position than for cereals, with farmers forecasting English yields at 3.1t/ha, nine per cent down on the five year average of 3.4t/ha. Plantings are believed to be significantly up on the five year average, at 655k/ha in 2011, indicating a potential total production of 2.028mt against the five year average of 1.762mt in England.

NFU combinable crops chairman Ian Backhouse said: “I believe this year’s forecast yield decrease was largely due to poor growing conditions since winter. With the east of England experiencing its lowest rainfall for the first half of the year in over 100 years, farmers are clearly concerned about the impact on the ground of this abnormally dry spring.

“I’d like to thank NFU members for completing this survey. Watching crops wither has meant a difficult time for many of our farmers and growers, particularly in the worst affected parts of the country.”

Responses have pointed to large variability in potential yields, often linked to almost complete lack of rainfall as well as soil type and capacity to hold water. Indications from respondents were that other cereal crop yields will be similarly affected, particularly for spring sown crops such as spring barley and spring wheat.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on July 05, 2011, 10:31:23 AM
Monday, July 04, 2011
CME: Surprises in Acreage, Grain Stocks Reports
US - The fireworks were flying the latest USDA Acreage and Grain Stocks reports, write Steve Meyer and Len Steiner.


The latest USDA data contained surprises for both the nearby and deferred futures markets. 1 June corn stocks were reported to be 3.670 billion bushels, some 350 million bushels higher than pre-report estimates. In the last DLR, the stocks number was highlighted in that estimates were implying livestock feed use during Mar - May down about 9 per cent from the previous year. Better quality corn may have allowed farmers to produce more meat with lower corn use. The much higher USDA stocks estimate implies corn feed use during Mar - May which is as much as 40 per cent lower than a year ago and 29 per cent lower than two years ago. Higher use of alternative feeds, including DDGs is always a factor and comparisons to a year ago may be skewed by how poor feed quality was last year. Still, the magnitude of the decline is very significant (even compared to 2009 good quality crop) and we will have to wait until the fall for the USDA to reconcile the stocks numbers with total production estimates.


The second big surprise in the report was the number of acres planted with corn. The most recent USDA survey showed that US farmers planted 92.3 million acres with corn, 1.6 million acres more than the most recent USDA estimate and pre-report market estimates, and even slightly larger than planting intentions early this spring. This increase adds about 270 million bushels to the corn balance sheet for next year. So what happened with all the talk of flooded acres and delayed plantings? The results were a lesson in system dynamics.

Plenty of acres were flooded and planting was delayed or lost in a number of areas. But as futures advanced to record levels, this allowed farmers in areas that had favorable weather to plant more corn, either by shifting soybean acres or putting corn in acres intended for hay. The report showed that farmers in the Dakotas, Texas and Illinois planted 1.1 million fewer acres than they reported in the March survey. However, farmers in Nebraska, Iowa, Minnesota and Wisconsin planted 1.1 million more acres than they intended in March. Total planted acres of corn, wheat, soybeans, cotton and hay were 295.1 million acres compared to 298.1 million acres intended in March. USDA announced yesterday that it will re-survey farmers in four states where plantings were delayed and the results of that re-survey will be published in August. In the meantime, trade will debate the full impact of flooding as well as the possible implication that the shift in acres from one state to the next will have on final yields.

The bottom line is that taken at face value, the most recent USDA data significantly alters the supply/demand balance sheet for this year and for next. Early calculations indicate that ending stocks for next year could be as high as 1.2 billion bushels, not a bumper supply but significantly better than the razor thin stocks reported in the latest WASDE. The stocks to use ratio for next year could climb to 8.6 per cent. Tom Elam and Steve Meyer have done some work on the shift in the relationship between stocks/use ratios and corn (see chart and DLR 1/28) and an 8.6 per cent ratio could push farm cash prices below the $5 threshold.




Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 22, 2011, 04:40:10 AM
Feed Outlook – August 2011
Lower projected yields have reduced global production prospects, according to the latest report from the USDA Economic Research Service.
 

The first survey-based forecasts for corn and sorghum sharply reduce this month's outlook for 2011/12 US feed grain production. Harvested acres and yield are reduced this month for corn, resulting in a projection for the third-largest corn crop on record, falling behind the 2007 and 2009 crops. Sorghum production is forecast down from last month, also on lower expected harvested acres and yield. Reductions this month in projected corn feed and residual, food, seed and industrial (FSI) use, and exports lower total disappearance for 2011/12. Ending stocks for corn, sorghum, and barley are reduced and oats are increased slightly from last month. Prices for the four feed grains are expected to be stronger with tight domestic supplies and low global stocks.

World coarse grain production for 2011/12 is down this month but foreign production is up led by increased prospects for corn in Brazil and for corn and barley in Ukraine. Global coarse grain use is reduced by increased prospects for wheat feeding. Foreign coarse grain ending stocks are projected higher, offsetting about half this month’s decline in US stocks.

US Feed Grain Supply Prospects Diminish
Forecast US feed grain beginning stocks in 2011/12 are raised 1.5 million tons from last month but are down 20.6 million tons from the previous year, a 43-per cent reduction. US feed grain production is forecast at 338.6 million metric tons, 15.7 million below last month but 8.6 million above the 2010/11 estimate. Compared with the amounts in 2010/11, production is up for corn but down for sorghum, barley, and oats. This month saw sharp declines in projected production for corn and sorghum. Feed grain supply is projected at 368.4 million metric tons this month, 14.2 million short of last month and 12.2 million below 2010/11.

Total 2011/12 feed grain use is projected 10.0 million metric tons lower from last month and 5.3 million short of 2010/11. This month's reduction reflects lower estimates for feed and residual, FSI and exports for corn and sorghum. Lower forecast use for fuel ethanol was partially offset by increases in corn sweeteners and starch use. FSI is projected at 172.0 million metric tons in 2011/12, compared with 169.8 million in 2010/11. Exports are forecast at 47.5 million metric tons, down 4.3 million from the previous estimate and 2.9 million below last season.

The US Census Bureau issued revised numbers for calendar year 2010, affecting trade estimates this month for corn and sorghum in 2009/10 and for barley and oats in 2010/11. Imports are unchanged for 2009/10 but are up slightly for 2010/11, with a small increase for oats. Marketing year exports for feed grains in 2009/10 are lowered slightly to 54.7 million metric tons, mostly reflecting a small downward revision for corn. In 2010/11, forecast exports are lowered for barley and oats based on the Census revisions, with sorghum and corn export projections also adjusted based on the pace of shipments. Feed grain exports for 2010/11 are projected 1.0 million metric tons lower to 50.4 million. Ending stocks for 2010/11 are up by 1.5 million metric tons to 27.5 million.

When converted to a September–August marketing year, feed and residual use for the four feed grains plus wheat in 2011/12 is projected to total 133.6 million tons, down from 138.7 million last month and down three per cent from the 2010/11 forecast of 138.0 million. Corn is estimated to account for 93 per cent of total feed and residual use in 2011/12, up from 92 per cent in 2010/11.

Projected grain-consuming animal units (GCAUs) for 2011/12 are up slightly from last month at 94.5 million. Estimated GCAUs for 2010/11 are unchanged at 93.1 million. Feed and residual use per animal unit is projected at 1.42 tons, down from last month's 1.47 tons due to lower cattle carcass and hog numbers.

US Corn Crop Prospects Lowered
US corn production in 2011/12 is forecast at 12,914 million bushels, down 556 million from last month but up 467 million from 2010/11. Harvested acreage for 2011/12 is forecast at 84.4 million acres for grain, down 500,000 from last month but up 2.9 million from the previous year. Based on conditions on 1 August, yields are expected to average 153.0 bushels per acre, down 5.7 bushels from last month's projection of 158.7 bushels and just 0.2 bushels higher than the estimated 2010 yield of 152.8 bushels. Unusually high average temperatures and below-average precipitation across much of the Corn Belt in July sharply reduced yield prospects. As of 8 August, 60 per cent of the corn crop was rated in good-to-excellent condition in the 18 major corn-producing States, down 11 percentage points from a year ago.

US Corn Use Expected To Slip
Total US corn use for 2011/12 is forecast down 340 million bushels to 13,160 million this month as a result of decreased exports, feed and residual use and FSI use. FSI use is lowered 40 million bushels. Corn for fuel is lowered 50 million bushels, and use for 'cereals and other' is reduced five million bushels. However, high fructose corn syrup (HFCS), corn used for starch, and glucose/dextrose are each raised five million bushels. US exports are reduced by 150 million bushels as high prices reduce demand and world feeders shift to more competitively priced wheat.

Total corn use for 2010/11 is forecast down 60 million bushels to 13,245 million bushels this month. Food, seed and industrial use (FSI) is reduced 10 million bushels to 6,420 million bushels. Lower use for ethanol, down 30 million bushels to 5,020 million, is partially offset by increases on other FSI categories. HFCS is increased 10 million bushels to 520 million as a result of expected increased exports to Mexico and the year-to-year pace through the third quarter. Glucose/dextrose and starch are both raised five million bushels to 265 million and 260 million, respectively. US exports for 2010/11 are reduced 50 million bushels to 1,825 million. Reductions in use leave ending stocks for 2010/11 up 60 million bushels compared with last month’s projection.

US Census Bureau trade revisions included changes for calendar year 2010. In the 2009/10 marketing year, corn exports are lowered seven million bushels to 1,980 million. FSI use is raised 22 million bushels to 5,961 million because of revisions to monthly ethanol production estimates by the US Energy Information Administration. Together, the revisions lower feed and residual use 15 million bushels to 5,125 million for 2009/10.

Corn prices received by farmers for 2011/12 are projected at $6.20 to $7.20 per bushel, up 70 cents on both ends of the range this month. The marketing year average reflects higher prices for corn with tighter ending stocks and tight global feed grain supplies. The 2010/11 corn price range is narrowed $0.05 at each end for an estimated range of $5.20 to $5.30 per bushel.

US Sorghum Production Lower
US sorghum production for 2011/12 is forecast at 241 million bushels, down 59 million from last month and 104 million bushels below last year. Expected area harvested for grain is forecast sharply lower at 4.4 million acres and down 420,000 from 2010/11. Based on conditions on 1 August, yield is lowered by 10.6 bushels per acre this month and is projected 17.0 bushels per acre below the previous season. Hot dry weather in Texas, Kansas and Oklahoma has reduced prospects for the 2011 sorghum crop. As of 8 August, 27 per cent of the US sorghum crop was rated good to excellent, compared with 66 per cent a year earlier.

Total use of sorghum in 2011/12 is projected down 55 million bushels this month to 245 million due to tight supplies. Feed and residual is cut 25 million bushels to 55 million as it may be difficult to put together enough sorghum to encourage feedlots to switch rations to include sorghum. Sorghum FSI use is lowered 10 million bushels to 80 million, with lower expected use for fuel ethanol. Export prospects are reduced 20 million bushels to 110 million as demand from Mexico is expected to remain strong but supplies will be a constraint. US ending stocks projected at 22 million bushels represent minimal 'pipeline' stocks.

Total use for sorghum in 2010/11 is forecast at 360 million bushels, unchanged from last month. Feed and residual use remains forecast at 125 million bushels. Sorghum used for ethanol is expected lower during the summer quarter, with tightening supplies cutting FSI use 10 million bushels to 85 million. Exports are raised 10 million bushels to 150 million, reflecting strong sales in July and the ongoing pace of shipments. Ending stocks for 2010/11 are virtually unchanged at 27 million bushels.

Sorghum prices received by farmers for 2011/12 are expected to average $6.00 to $7.00 per bushel, up 90 cents on both ends of the range from last month, as reductions in domestic feed grain supplies raises prices for all feed grains. The 2010/11 average sorghum price is narrowed $0.05 on each end of the range to $5.15 to $5.25 per bushel.

US Barley Production Prospects Up
US barley production for 2011/12 is forecast at 168 million bushels, down four million bushels from last month and down 12 million from 2010. Based on conditions on 1 August, producers expect yields to average 70.4 bushels per acre, up 0.8 bushels from last month. Production is expected to reach record lows on lower harvested acreage and yield as compared with last year. Area harvested for grain is forecast at 2.4 million acres, slightly lower than last month's estimate and down three per cent from 2010. On 8 August, 72 per cent of this year's US crop was rated in good-to-excellent condition, compared with 83 per cent a year ago.

Total barley supplies in 2011/12 are lowered 4 million bushels this month to 268 million, as a result of lower production. Domestic use is forecast at 210 million bushels, unchanged this month. With lower supply and steady use, this month's ending stocks are projected down four million bushels to 58 million, compared with 89 million in 2010/11.

US Census Bureau revisions for calendar year 2010 increased barley exports for 2009/10 slightly. Exports for 2010/11 were reduced slightly. Imports were reduced 0.5 million bushels to 9.5 million.

Prices received by farmers for barley in 2011/12 are expected to average $5.80 to $6.90 per bushel, raised 15 cents on both ends of the range this month. This compares with $3.86 per bushel for 2010/11. Although prices for feed barley are expected to increase largely in line with those for corn and sorghum, price gains will be limited for malting barley as much of the crop is produced under contract.

US Oats Production at Record Low
US oats production for 2011/12 is forecast at 57 million bushels, increased slightly from a month ago. This would be down 24 million from 2010/11, and if realised, the lowest production on record. Harvested area is forecast at 0.9 million acres, unchanged from last month and a record low. Based on conditions on 1 August, producers expect yields to average 61.6 bushels per acre, an increase of 1.1 bushels from the July forecast but a decrease of 2.7 bushels from last year. On 8 August, 52 per cent of the oat crop in the nine major producing States was rated as good to excellent, compared with 77 per cent last year.

Total oats supplies for 2011/12 are edged up this month to 215 million bushels. Oats use estimates remain unchanged with total use at 169 million bushels.

US Census Bureau revisions for calendar year 2010 result in minor changes in oats exports for 2009/10 and raise exports for 2010/11 0.2 million bushels to an estimated 2.8 million. Census data indicate 2010/11 imports reached 85.1 million bushels, up 2.1 million from the previous month's forecast. Small increases in imports for marketing years 2009/10 and 20010/11 produced corresponding changes in feed and residual use. FSI for 2010/11 was reduced two million bushels to 74 million.

Prices received by farmers in 2011/12 are expected to average $3.40 to $4.00 per bushels, up 20 cents on both ends of the range. This compares with $2.52 per bushel for 2010/11.

US Hay Production Slips in 2011/12
All US hay production in 2011/12 is forecast at 132.0 million tons, down 13.6 million from 2010/11 due to extremely hot and dry weather. The all-hay yield is expected to be 2.29 tons per acre, down from 2.43 tons per acre in 2010/11. Harvested acres are forecast at 57.6 million acres, down 2.3 million from last year and the lowest all hay area on record going back to 1919.

Alfalfa hay production is forecast at 65.0 million tons, down four per cent from last year.

Based on crop conditions on 1 August, yields are expected to average 3.36 tons per acre, down 0.04 tons from last year. If realised, this will be the second highest yield since 2005. Harvested area is forecast at 19.3 million acres, unchanged from June but down three per cent from the previous year's acreage.

Other hay production is forecast at 67.0 million tons, down 14 per cent from last year.

Based on conditions on 1 August, yields are expected to average 1.75 tons per acre, down 0.2 tons from last year. If realised, this will be the lowest US yield since 1988. Harvested area, forecast at 38.3 million acres, is unchanged from June but down four per cent from last year.

Roughage-consuming animal units (RCAUs) in 2011/12 are estimated to be down from 2010/11. Even with lower RCAUs, the sharp drop in hay production leaves hay supply per RCAU down at 1.94 tons, compared with 2.10 tons in 2009/10.

With tighter hay supplies, prices have risen sharply in recent months. The preliminary July 2011 estimate for the average price received by farmers for all hay was $170 per ton, compared with $112 per ton in July 2010. The preliminary July estimate for alfalfa hay was $189 per ton, compared with $117 per ton last season. The preliminary July estimate for hay other than alfalfa and alfalfa mixtures was $119 per ton, compared with $97 per ton a year ago.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 22, 2011, 04:41:17 AM
Global Coarse Grain Production Down Due to US Drop
World coarse grain production is down 14.0 million tons this month to 1,136.3 million tons, mostly because of reduced US prospects. In contrast, foreign production is projected up 1.7 million tons to 797.5 million, mostly due to increased corn and barley prospects. Foreign corn production is up 2.2 million tons this month to 532.5 million, led by increased prospects in Brazil. Foreign barley production is up 0.8 million tons to 128.7 million, boosted by improved prospects for Ukraine. EU oats production increased this month, boosting projected world production slightly. Global rye and mixed grains are each reduced 0.8 million tons this month as EU production prospects are reduced, mostly due to excessive rain during harvest in Poland and Germany.

Brazil's 2011/12 corn crop is projected up 2.0 million tons to 57.0 million, supported by increased area prospects. Planting for the main crop starts in September, and recent price increases for corn relative to those for other crops support expanded area, even in Brazil where climatic conditions often make soybeans less risky than corn. Brazil's estimated corn crop for 2010/11 remains at 55.0 million tons, with upward revisions reported for the main crop offsetting declining prospects for the second crop.

Ukraine's corn production prospects are increased 1.0 million tons to 16.5 million based on increased reported area. Favourable soil moisture during seeding and attractive prices encouraged corn plantings. EU corn production prospects are increased 0.8 million tons this month to 60.1 million, with improved yield prospects in Germany and increased reported area for Romania, Italy, Slovakia and Bulgaria more than offsetting lower-than-expected area in France.

Egypt's corn production prospects are cut 0.8 million tons to 5.9 million because producers are reported to have shifted area to rice, likely due to relaxed government controls. Canada's corn production prospects are trimmed 0.3 million tons to 11.0 million as yield prospects in Ontario are reduced by delayed crop development and dry conditions in some locations. Lower area and trimmed yield prospects are reducing Croatia's corn production prospects 0.2 million tons to 2.0 million. Ongoing drought in northeast Kenya is reducing corn production prospects 0.2 million tons to 2.8 million; the drought is also extending into Somalia, cutting 2011/12 corn production prospects in half to 60,000 tons. However, corn production in Kenya for 2009/10 and 2010/11 is revised 0.3 million tons and 0.4 million higher this month. Corn production for 2010/11 is also raised this month for India, the EU and Indonesia, more than offsetting a small decline for Mexico. A decline in 2010/11 Mexican sorghum production is more than offset by an increase for Argentina.

Barley production prospects in Ukraine for 2011/12 are up 1.0 million tons this month to 8.5 million. Nearly complete harvest data reveal higher-than-expected yields. Argentina's 2011/12 barley production prospects are increased 0.4 million tons to 3.1 million based on increased area prospects. The export quota regime for wheat makes barley an attractive alternative winter grain for producers who wish to avoid the uncertainty of the government's wheat export policy. Argentina's 2010/11 barley area was increased slightly, boosting production 0.05 million tons to 2.95 million. India reported a slightly higher barley yield, boosting 2011/12 production 0.07 million tons to 1.57 million, a rabi crop harvested months ago. China's winter grain harvest report also boosted barley yield slightly, increasing production 0.05 million tons to 2.6 million.

EU barley production prospects for 2011/12 are reduced 0.6 million tons this month to 51.5 million. Spring dryness in France and Germany, compounded by excessive harvest rains in Germany, trimmed barley yields. Also, Spain reported lower barley area. Kazakhstan reported no increase in barley area for 2011/12, reducing barley production prospects 0.1 million tons to 2.1 million. Croatia also reported no growth in barley area, reducing production prospects slightly.

World 2011/12 Beginning Stocks Increased This Month
Global coarse grain beginning stocks for 2011/12 are increased 3.6 million tons this month to 160.9 million. Foreign countries account for 2.1 million tons of the increase. Argentina's coarse grain beginning stocks for 2011/12 are boosted 0.7 million tons to 2.7 million with increased corn production estimated for 2009/10 and increased sorghum production for 2010/11. Area harvested is estimated higher. EU coarse grain beginning stocks for 2011/12 are increased 0.6 million tons to 15.7 million, mostly due to reduced barley feed use estimated for 2010/11. Beginning stocks are also increased for India, Indonesia, Russia, Kenya, and several other countries. Beginning stocks for 2011/12 are reduced 0.5 million tons for South Africa based on increased 2010/11 corn exports. Mexico's beginning stocks are also trimmed.

Global Coarse Grain Use Prospects Reduced
World coarse grain disappearance in 2011/12 is projected down 8.4 million tons this month to 1,150.0 million. Foreign use is forecast down 2.7 million tons to 849.5 million as strong prices ration demand. EU coarse grain domestic use is cut 2.0 million tons this month to 146.5. Coarse grains are being displaced by feed wheat in animal rations, cutting EU feed and residual prospects 2.7 million tons to 108.2 million. EU 2010/11 coarse grain feed use estimated for 2010/11 is also reduced this month. However, based on demand prospects reported by USDA's Foreign Agricultural Service posts in the EU, food, seed and industrial use in 2011/12 is boosted 0.75 million tons to 38.3 million, with most of the increase attributed to barley used for malting. Canada is also expected to have coarse grain feed use displaced by competitively priced wheat, cutting coarse grain feed and residual use 0.7 million tons this month to 14.2 million tons. South Korea and Thailand are expected to import wheat for feed, displacing coarse grains and trimming feed and residual use 0.5 and 0.2 million tons, respectively. Egypt, with reduced corn production prospects, has feed and residual forecast 0.3 million tons lower this month.

Partly offsetting the aforementioned declines are increased 2011/12 use prospects for Saudi Arabia, up 0.8 million tons, based on increased barley imports; India, up 0.5 million, with increased use estimated for 2010/11; Indonesia, up 0.3 million, due to growing feed demand; China, up 0.2 million, due to increased barley malting for beer production; and several other countries, up by smaller amounts.

Foreign Coarse Grain Ending Stocks Projected Higher
World coarse grain ending stocks in 2011/12 are projected down 2.0 million tons this month to 147.2 million but foreign stocks are forecast up 2.1 million tons to 126.6 million, roughly offsetting half the drop in US stocks. Increased foreign production and reduced coarse grain feed use because of ample supplies of competitively priced wheat combine to boost prospects for foreign ending stocks.

Brazil's coarse grain ending stocks in 2011/12 are increased 2.0 million tons to 8.5 million this month, supported by increased corn production prospects. Ending stocks for Brazil are still expected to decline for the fourth consecutive year. Saudi Arabia's coarse grain stocks are up 0.3 million tons to 1.6 million, based on strong barley imports. However, Saudi stocks are also expected to decline for the fourth straight year. Smaller increases are expected for Thailand, Ukraine, Turkey, Viet Nam and several other countries. Partly offsetting these increases are reduced stocks forecast for South Africa, down 0.5 million tons to 4.0 million, due to recent strong corn export shipments. Smaller reductions in stock prospects are expected for Mexico and some other countries.

US Corn Export Prospects for 2011/12 Reduced
US corn exports in trade year 2011/12 are projected at 45.0 million tons, down 3.0 million this month – down 150 million bushels to 1.75 billion for the local marketing year – due to tight US supplies and high corn prices, increased competition from other exporters and declining world corn trade caused by increased availability of competitively priced feed quality wheat.

World corn trade in 2011/12 is projected to reach 92.8 million tons, down 0.9 million this month. EU corn imports are reduced 1.0 million tons to 4.0 million because of increased production and feed use of wheat. EU wheat feed use is forecast up 2.0 million tons this month. South Korea, Thailand and Viet Nam have reduced corn imports forecast this month – down 0.5 million tons, 0.1 million and 0.1 million, respectively – due to increased import prospects for feed quality wheat. Partly offsetting are increased corn imports expected for Egypt, up 0.5 million tons, and Kenya, up 0.15 million, because of reduced production prospects.

Ukraine, with increased corn production prospects, is projected to export 8.5 million tons in 2011/12, up 1.0 million this month. Argentina, with increased estimated beginning stocks, is projected to export 17.5 million tons of corn in 2011/12, up 0.5 million tons this month. Canada's corn export prospects are increased 0.5 million tons this month to 1.0 million as the recent strong pace of sales and shipments is expected to slow but not cease in 2011/12. South Africa has shipped corn in recent months at a pace that indicates that port capacity and transportation infrastructure problems are not as severe as previously thought. Its corn export prospects for 2011/12 are boosted 0.3 million tons this month to 2.3 million. Croatia's 2011/12 corn exports are trimmed 0.15 million tons to 0.1 million due to reduced production prospects.

US 2011/12 Sorghum Export Prospects Drop
Sharply reduced US production prospects are limiting sorghum export prospects for 2011/12. Exports are projected down 0.4 million tons to 2.9 million – down 20 million bushels to 110 million for the local marketing year). Argentina's sorghum exports for the 2011/12 October-September trade year are boosted 0.3 million tons to 2.0 million, supported by increased production in the 2010/11 March-February local marketing year. EU sorghum imports are trimmed slightly for 2011/12.

US sorghum exports for 2010/11 are increased 0.2 million tons to 3.8 million this month based on the recent pace of sales and shipments and strong demand from Mexico. Demand growth in Mexico stems from reduced production prospects, especially in Tamalipas. According to Census data, US sorghum exports for October-June reached 2.9 million tons. Sorghum grain inspections in July 2011 were 0.3 million tons, up 50 per cent from a year earlier. As of 4 August, outstanding sales were 0.4 million tons, down just two per cent from last year at this time, supporting prospects for shipments in August and September 2011.

US 2010/11 Corn Exports Slump
US corn exports for 2010/11 are forecast down 2.0 million tons to 46.0 million – down 50 million bushels to 1.825 billion for the local marketing year. The pace of export sales and shipments has fallen short of expectations in recent months as US corn prices have not been competitive with feed-quality wheat, and other exporters have shipped aggressively. The 2010/11 forecast is down seven per cent from the previous year. Census exports for October-June reached 34.1 million tons, down five per cent from the previous year. July export inspections were only 3.9 million tons, down 14 per cent from a year ago. Moreover, as of 4 August, outstanding export sales reached only 5.7 million tons, down 23 per cent from the same week last year. With US corn in Southern States damaged by drought, less new-crop corn than usual is likely to be available for shipment in September 2011.

Partly offsetting the drop in US export prospects for 2010/11 are increased exports forecast based on the recent pace of shipments for Argentina, up 0.5 million tons; India, up 0.4 million; South Africa, up 0.3 million; Canada, up 0.2 million; and Thailand, up 0.05 million. Import forecast adjustments based on the pace of recent shipments include Japan, down 0.6 million tons; Viet Nam, down 0.3 million; Thailand, down 0.1 million; Indonesia, up 0.5 million; Turkey, up 0.2 million; and the United States and Kenya, up by smaller amounts.

August 2011
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on September 13, 2011, 10:11:19 AM
US corn exporters fear Colombia-Canada FTA
//29 Aug 2011
 Exporters of corn in the US are afraid they will lose market share in Colombia now this Latin American country has signed a free trade agreement with Canada.
 

With the implementation of the free trade agreement (FTA) between Colombia and Canada on August 15, US exports will be facing Canadian feed wheat as a new competitor for American corn.
 
 
 
US Grains Council trade sources indicate that Colombian buyers have placed orders for 125,000 mt of Canadian feed wheat in the 10 days since the agreement went into effect and as such eroding US corn sales opportunities in the Colombian corn market.
 
 
 
The ratification of a US-Colombia FTA for corn is still pending and as a result US corn is still taxed with a 15% duty. In contrast, corn from Brazil and Argentina is taxed 6.7% and now Canadian wheat is now duty-free.
 
 
 
In 2007, Colombia imported  3 million tons of corn with the United States enjoying a 93% market share. Since then the US market share has shrunk to 20% in 2010.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on September 20, 2011, 09:13:39 AM
Feed Outlook – September 2011
The US corn yield has dropped and this is expected to boost prices, according to the latest report from the USDA Economic Research Service.
 

The US corn yield forecast for 2011/12 dropped 4.9 bushels per acre this month to 148.1 bushels. Corn production prospects are reduced 417 million bushels to 12.5 billion, just 0.4 per cent higher than the previous year despite a 4.6 per cent increase in planted area. Sustained high corn prices are expected to reduce use, with feed and residual down 200 million bushels and ethanol use and exports each down 100 million. US ending stocks are down 42 million bushels to 672 million, as high prices maintain a stocks-to-use ratio near five per cent. World corn ending stocks are boosted this month as foreign production responds to sustained high prices. The US share of world corn trade is projected to fall below 50 per cent for the first time in 30 years.


DOMESTIC OUTLOOK

Feed Grain Supply and Use Down
US feed grain production in 2011/12 is forecast at 328.1 million metric tons, down 10.5 million from last month’s forecast and slightly below the 2010/11 estimate of 330.0 million. Sharply reduced corn yield and production this month swamp a small sorghum production increase. Forecast beginning stocks are down 0.5 million tons from last month and down 21.1 million from last year. Feed grain supplies in 2011/12 are forecast at 357.3 million tons, down 11.1 million from last month primarily due to lower carry-in and the decreased yield forecast for corn. Feed grain supplies are down 23.3 million tons from last year’s estimate.

Projected feed grain use for 2011/12 dropped 10.2 million tons this month to 337.6 million as sustained high prices are expected to constrain demand. Total use is forecast down 16 million metric tons from the 2010/11 projection. Feed and residual drops 5.1 million tons from last month as high grains prices constrain livestock profitability and the smaller forecast corn crop reduces residual disappearance. Feed and residual is projected at 123.2 million tons for 2011/12, compared with the 2010/11 projection of 133.0 million. Projections for food, seed and industrial (FSI) uses and exports each slipped 2.5 million tons from last month. Lower projected corn use for ethanol reduces feed grain FSI use.

For 2010/11, feed grain FSI is raised 254,000 tons this month due to increased corn use for high-fructose corn syrup and glucose and dextrose. Exports are also raised by the same amount to 50.6 million this month, reflecting August corn shipments. This lowers projected ending stocks by 500,000 tons to 27.0 million.

Feed Use
When converted to a September-August marketing year, feed and residual use for the four feed grains plus wheat in 2011/12 is projected to total 128.5 million tons, down 5.7 million from last month and down seven per cent from the 2010/11 forecast of 138.2 million. Corn is estimated to account for 94 per cent of the feed and residual use in 2011/12, up from an estimated 92 per cent in 2010/11.

The projected index of grain-consuming animal units (GCAU) for 2011/12 is 94.5 million units, slightly higher than the 2010/11 estimate of 92.9 million. The grain used per GCAU in 2011/12 is expected to be 1.36 tons, down from an estimated 1.49 tons in 2010/11. Sustained high grain prices and lower residual disappearance are expected to cause the reduction in grain disappearance per GCAU. In the index components, GCAUs are decreased slightly for dairy, hogs, layers and broilers from last month.

USDA’s Quarterly Hogs and Pigs report will be released on 24 September and will provide an indication of sow farrowing intentions into early 2011. Higher feed prices are expected to slow pork production gains and reduce feed use.

Corn Yield Cut, Production Slips this Month
US corn production in 2011/12 is forecast at 12.5 billion bushels, down 417 million from last month and only 50 million bushels above 2010/11, despite a 4.6 per cent increase in planted area. Based on conditions on 1 September, the national average corn yield is forecast at 148.1 bushels per acre, down 4.9 bushels from the August forecast and 4.7 bushels per acre below the 2010/11 yield. The current yield forecast for 2011/12 is 16.6 bushels below the 2009/10 record and would be the lowest yield since 2005/06. Despite this lower yield, production is forecast to be the third highest ever, with the second highest planted area since 1944.

Projected beginning stocks for 2011/12 are lowered 20 million bushels this month to 920 million, reflecting higher estimates of exports and FSI use during the 2010/11 season. Projected imports for 2011/12 were reduced five million bushels, and if realised, the 15 million bushels imported will be half the level imported during the 2010/11 crop year. The reduced imports primarily reflect slower shipments from Canada due to lower production there. The resulting corn supply for 2011/12 is projected at 13.4 billion bushels, 442 million below last month’s projection and 753 million below 2010/11. Estimated 2010/11 supplies were unchanged this month at 14.2 billion bushels.

Feed and residual use for 2011/12 is lowered 200 million bushels this month, as tighter supplies and higher prices trim feed demand. Residual disappearance is also expected to decline with the smaller crop. The export projection is cut 100 million bushels as US supplies tighten relative to other producers. FSI use was lowered 100 million bushels on lower projected ethanol production based on reduced prospects for fuel consumption reported by the Energy Information Administration. Projected 2011/12 ending stocks are lowered 42 million bushels from last month to 672 million bushels as strong prices maintain ‘pipeline’ stocks relative to use of about five per cent.

Projected 2011/12 corn prices are increased 30 cents on each end of the range for an average of $6.50 to $7.50 per bushel, reflecting tighter supplies and reduced ending stocks. The 2010/11 estimated price was reduced five cents to $5.20 per bushel from the mid-point of last month’s estimated range.






Sorghum Production Advances
US sorghum production is forecast at 244 million bushels for 2011/12, an increase of 3.5 million bushels over the August forecast reflecting higher than expected yields in Texas. At the forecast level, this year’s production is still 101 million bushels below the 2010/11 harvest. Based on conditions on 1 September, the sorghum yield forecast was increased 0.8 bushels per acre to 55.6 bushels per acre. However, yields are 16.2 bushels per acre lower than last season due to drought in the southern growing regions. In Kansas, the top producing state, producers are expecting a yield of 55 bushels per acre, unchanged from last month and 21 bushels below the 2010 estimate. Producers in Texas, the second largest sorghum-producing state, expect the crop to yield 52 bushels per acre, up two bushels from last month but down 18 bushels from last year.

This month’s increased projected supplies are reflected in a forecast 3.5-million-bushel increase in ending stocks for 2011/12 compared to August.

The sorghum farm price is forecast 30 cents per bushel higher on each end or the range this month to $6.30 to $7.30 per bushel, supported by tight supplies and higher corn prices. The 2010/11 farm price forecast is lowered five cents from the mid-point of last month’s projected range to $5.15 per bushel.






The increase in production boosts 2011/12 projected supply 3.5 million bushels to 270.759 million. Sorghum supply and use for 2010/11 was unchanged this month.

Barley and Oats Unchanged
US barley and oats production was not revised in the September Crop Production report. Any production revisions will be reported in the Small Grains 2011 Summary to be released 30 September 2011. No changes are made this month in barley or oats supply and use.

For the 2011/12 marketing year, the projected season-average farm price for all barley is reduced 35 cents per bushel on each end of the range to $5.45 to $6.55 per bushel. While prices for feed barley are expected higher with rising feed grain values, reported prices for malting barley have been lower than expected. Much of the malting barley crop is raised under contract with prices set last winter and spring before planting. The 2010/11 estimated price for all barley is unchanged at $3.86 per bushel.

The 2011/12 projected oats price is unchanged at $3.40 to $4.00 per bushel. Stronger corn prices for 2011/12 are expected to support other feed grain prices; however, a substantial portion of the 2011/12 oat crop has already been marketed at prices well below current levels. The 2010/11 estimated price for oats is unchanged at $2.52 per bushel.

INTERNATIONAL OUTLOOK

Increased Foreign Coarse Grain Production Partly Offsets US Drop
World coarse grain production in 2011/12 is projected at 1,131.2 million tons, down 5.1 million this month but foreign production is up 5.4 million tons to 802.9 million. Most of the large changes in 2011/12 production this month are for corn. Global millet production is up 0.4 million with increased production for Russia and Ukraine, while barley is up 0.2 million with increases for Ukraine and the EU more than offsetting a 0.7-million-ton drop for Morocco caused by excessive rains during the harvest. World oats and rye production are nearly unchanged this month, with foreign sorghum and mixed grain production unchanged.

Foreign corn production for 2011/12 is up 4.8 million tons this month as increases for Brazil, Argentina, Ukraine and the EU more than offset reductions for Egypt and Canada. Brazil’s corn production in 2011/12 is projected to reach a record 61.0 million tons, up 4.0 million. The Brazilian Government published its final estimate of 2010/11 corn production at 57.5 million tons, up 2.0 million from last month’s USDA forecast, with increased area and production for the second crop. Despite the late corn planting and early cut-off of rains in Mato Grosso, the seven per cent area expansion for all of Brazil in 2010/11 supported record corn production. Current strong corn prices compared to soybean prices are expected to support corn area expansion for the first-crop 2011/12 corn just now being planted in Southern Brazil, while the high prices of both corn and soybeans are expected to encourage expanded area in the Center-West for double-cropped soybeans and corn. Total corn area in 2011/12 is projected up five per cent to 14.5 million acres, supporting another record corn crop.






The strong prices for corn compared to soybeans are also expected to support corn area in Argentina, forecast up 12.5 per cent from a year earlier. Increased area is boosting projected 2011/12 corn production 1.5 million tons this month to a record 27.5 million tons.

Corn production prospects for Ukraine are increased 1.5 million tons to 18.0 million based on early harvest reports and the good condition of the crop. Favourable temperature and rainfall during the season in most areas is confirmed by satellite imagery. Good corn yield prospects boost projected EU 2011/12 corn production 1.0 million tons this month to 61.0 million. Improved crop prospects are reported for Romania, France, Hungary, Poland and Bulgaria.

Corn production prospects are reduced dramatically this month for Egypt, down 2.1 million tons to 3.8 million. The government is not effectively limiting access to irrigation water for rice, and with rice more profitable than corn, Egyptian producers are planting rice in place of corn. Egyptian corn area is projected to drop 39 per cent to 0.52 million hectares in 2011/12, the lowest in the USDA database back to 1960, and production is expected to be the smallest since 1985/86.

Canada’s corn yields are projected lower this month as the growing season has been less than ideal, with Ontario suffering from some of the same problems as neighboring Ohio. Canada’s 2011/12 average corn yield is forecast down 14 per cent from the previous year’s record.

Corn production prospects for the Philippines are also down slightly (0.1 million tons) due to reduced area prospects.

Increased Foreign Beginning Stocks Support 2011/12 Supplies
Foreign coarse grain beginning stocks for 2011/12 are increased 2.5 million tons this month to 135.9 million, more than offsetting the 0.5-million-ton US decline. Foreign supplies (production plus beginning stocks) for 2011/12 are projected up 8.0 million tons this month, with a 5.4-million-ton increase in production.

Most of the foreign increase in coarse grain beginning stocks is from a 1.9-million-ton increase for corn. Brazil, with increased 2010/11 corn production, is projected to carry in 10.0 million tons of corn, up 1.3 million this month. Ukraine’s 2011/12 carry-in is raised 0.5 million tons this month and Paraguay’s is boosted 0.3 million, due to reduced 2010/11 export sales and shipments reported for the final months of the marketing year. Partly offsetting is a 0.2-million-ton reduction in beginning stocks for China because of a reduction in 2010/11 estimated imports.

World barley beginning stocks for 2011/12 are up 0.5 million tons this month to 26.1 million, mostly due to a Statistics Canada report revealing stocks 0.3 million tons higher than forecast last month by USDA. Russia’s barley stocks are boosted 0.1 million tons due to increased 2010/11 imports. Several other countries have smaller changes in barley beginning stocks.

Global oats beginning stocks for 2011/12 are up 0.2 million tons to 3.1 million, with increases for Canada and Chile. Beginning stocks of rye are reduced slightly, and sorghum is unchanged.

US Changes Cut Global Coarse Grains Consumption Prospects
World coarse grain use in 2011/12 is projected down 5.9 million tons this month to 1,144.1 million due to reduced US use. However, foreign consumption is forecast up with increased supplies. Foreign use is forecast up only 1.7 million tons to 851.2 million, as high prices limit consumption gains. Foreign corn use is up only 0.3 million tons as changes are mostly offsetting, with reductions for Egypt and Canada offset by increases for Brazil, Colombia and changes in the sum of world trade. While the sum of local marketing year exports increased slightly this month, imports declined 0.5 million tons, increasing global disappearance.

Brazil’s corn use for 2011/12 is projected up 1.5 million tons this month to 52.0 million tons, while the previous year is estimated up 0.7 million tons to 49.5 million. Expanding poultry and pork production for domestic use and meat exports supports the five per cent growth in corn use estimated for 2010/11 and projected for 2011/12. Colombia’s 2011/12 corn use is up 0.2 million tons this month to 5.4 million based on growth in poultry production.

Corn consumption in Egypt for 2011/12 is cut 1.7 million tons to 10.4 million. Sharply reduced corn production and uncertain economic prospects cut expected food, seed and industrial use 0.6 million tons to 1.6 million, and faltering poultry production is expected to cut feed and residual use 1.1 million tons to 8.8 million. Reduced production in Canada is expected to reduce corn feed use to 6.3 million tons, down 0.5 million this month.

World barley consumption in 2011/12 is projected up 1.0 million tons this month to 137.1 million. Increased use is projected for Saudi Arabia, up 0.5 million tons this month to 7.1 million. The Saudi Government has backed up assurances of maintaining ample supplies for feeding sheep and camels by importing aggressively in recent weeks. Syria has also imported at a stronger rate than expected, boosting use prospects 0.2 million tons to 1.2 million. Russia, with increased beginning stocks and no incentive to build stocks during 2011/12, is expected to increase use, boosting domestic consumption 0.3 million tons this month to 14.3 million. Chile’s barley use is up slightly this month. However, with reduced production prospects, barley use in Morocco is forecast down 0.1 million tons to 3.2 million.

Increased millet production in Russia and Ukraine is boosting consumption 0.4 million tons this month. Increased oats supplies in Chile boost prospects for 2011/12 use 0.1 million tons this month.

World Corn and Coarse Grain Ending Stocks Increased This Month
Global coarse grain ending stocks for 2011/12 are projected up 2.8 million tons this month to 150.0 million. Foreign stocks are up 3.7 million tons, more than offsetting the decline in US prospects. Foreign corn stocks are up 3.9 million tons, barley is down 0.3 million, and sorghum and oats are each up 0.1 million.

Brazil’s corn ending stocks for 2011/12 are up 2.8 million tons this month to 11.0 million. A combination of sharply increased production prospects and no government programme to subsidise transport for export or domestic use is expected to result in corn stocks building in Brazil during 2011/12. This month, corn ending stocks are boosted 0.5 million tons each for Argentina, Ukraine, Paraguay and the EU. Increased production boosts ending stocks prospects for Argentina, Ukraine and the EU but slow imports by Brazil are expected to cause stocks to build in Paraguay. Corn ending stocks prospects are reduced 0.5 million tons for Egypt due to reduced production, 0.2 million for China because of reduced 2010/11 imports, 0.1 million for the Philippines due to reduced area, and slightly for Chile.

Barley ending stocks prospects for 2011/12 are cut 0.6 million tons each for Morocco and Russia. Reduced production is expected to cut stocks in Morocco, while strong demand for exports and domestic use is likely to limit Russia’s barley stocks. Partly offsetting are increased stocks prospects for Canada, up 0.4 million due to increased beginning stocks revealed by a stocks survey;for the EU, up 0.3 million due to increased production; and for Saudi Arabia, up 0.2 million based on increased imports and government policy.

US Corn Exports Lowered as Competitors Increase Share
Sustained high prices for US corn are encouraging competitors’ production and exports. In 2011/12, for the first time since 1971/72, the US share of the world corn market is expected to fall below 50 per cent. This month, US corn exports for trade year 2011/12 are reduced 3.0 million tons to 42.0 million – down 100 million bushels to 1.65 billion for the September-August local marketing year. Reduced US production and high prices are expected to limit demand, including exports. As of 1 September, outstanding export sales were 13.2 million tons, down from 15.1 million a year earlier.

High corn prices relative to those for other crops are helping boost competitors’ production. Ukraine, with expanded area and record yields is expected to export 10.0 million tons of corn, up 1.5 million this month. Brazil and Argentina, in the Southern Hemisphere, have increased 2011/12 production prospects this month but that production will be available for only a portion of the October-September trade year. Trade year 2011/12 export prospects for the two countries are up 0.5 million tons each to 8.5 and 18.0 million, respectively. EU corn exports are up 0.5 million tons to 1.5 million, boosted by increased production and attractive prices outside the EU. Both Romania and Bulgaria are in a good position to ship to markets outside the EU.

Canada’s corn export prospects for 2011/12 are cut in half, down 0.5 million tons to 0.5 million, because of reduced production prospects. Paraguay’s exports are reduced 0.2 million tons to 1.5 million due to weak import demand from neighbouring Brazil.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on September 20, 2011, 09:14:29 AM
World corn trade forecast for 2010/11 was adjusted down 0.3 million tons to 91.7 million tons. Argentina’s exports are raised 0.5 million tons to 15.0 million and Ukraine’s are reduced 0.5 million to 5.5 million, both based on the pace of shipments in recent months. Imports by Brazil, China and Chile are each trimmed 0.2 million tons because of the slow pace of recent shipments and purchases.

The pace of US shipments for 2010/11 supports the 46.0 million tons forecast for the October-September trade year. Census data for October through July reached 38.3 million tons, and August grain inspections were 3.7 million. If the August Census number comes in a bit higher than inspections, as is normal, and if September 2011 shipments fall modestly from those of the previous year, exports will be on pace. The 2010/11 local marketing year (September-August) exports are increased 10 million bushels to 1,835 million based on the August inspections.

World Sorghum Trade Boosted Slightly
Global sorghum trade in 2011/12 is projected up 0.2 million tons this month to 6.2 million. Australia’s export prospects are increased 0.2 million tons to 1.0 million. Import prospects for Colombia and Chile are each increased 0.1 million tons based on increased imports estimated for the previous year.

World sorghum trade forecast for 2010/11 is reduced slightly, with a 0.2-million-ton increase for Argentina more than offset by a 0.3-million-ton reduction for Australia. Australia’s shipments to Japan have lagged expectations, trimming Japan’s imports 0.3 million tons to 1.3 million. However, Argentina’s shipments to Colombia and Chile exceeded expectations.

US sorghum exports for 2010/11 are on pace to reach 3.8 million tons for the trade year and 150 million bushels for the local year based on August inspections of 3.3 million, slightly above a year earlier.

Global Barley Trade Prospects Increase
World barley trade for 2011/12 is increased 0.9 million tons this month to 15.4 million. Saudi Arabia has been buying aggressively and has demonstrated it intends to maintain ample supplies. Saudi imports are increased 0.7 million tons this month to 7.0 million. Syria’s imports are increased 0.2 million tons to 0.5 million due to strong demand.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on November 02, 2011, 10:15:00 AM
Tuesday, November 01, 2011
Crop Prices Treading Water
US - Following wide swings in September and early October, the prices of corn, soybeans, and wheat have traded in relatively narrow ranges in the last half of October. Narrow trading ranges reflect the lack of new information and, in some cases, conflicting demand indicators.


Since 12 October, December 2011 corn futures have traded in a range of about $.40, with a high near $6.65. That contract is now about $1.40 below the late August high. Basis levels remain generally strong and are at record levels for this time of year in some markets.

Demand news tends to be mixed for corn. Ethanol production since 1 September has been near the level of a year ago, suggesting corn consumption in that market remains at record levels. Spot market margins for ethanol producers have increased sharply since reaching record low levels in June. Calculated margins are near the highs reached in 2007.

Declining corn prices and higher ethanol prices have both contributed to the improved margins. Ethanol production looks to be large for the next two months, with more uncertainty in 2012 after the blender’s tax credit expires.

The pace of feed use of corn is not known. Use should be supported by the large number of cattle on feed, but weekly placements of broiler-type chicks continue to run six to eight per cent under the level of a year ago. Considerable uncertainty about feed and residual use of corn has been created by the surprisingly low level of consumption implied for the 2010-11 marketing year and by the unknown level of wheat feeding. The December Grain Stocks report will shed more light on that issue.

US corn exports are expected to be at a nine year low of 1.6 billion bushels during the current marketing year, 235 million bushels less than exported last year. Exports are expected to be negatively influenced by the large supply of corn and wheat in the rest of the world. Exports need to average about 30.8 million bushels per week to reach the projected level.

Export inspections during the first eight weeks of the year averaged 27.3 million bushels per week. The Census Bureau will release an estimate of September exports on 10 November. Export sales have been large so that cumulative export commitments stood at 806 million bushels on 20 October, 25 million larger than commitments of a year earlier.

China has purchased 78 million bushels of US corn. That is equal to the USDA projection of Chinese imports from all origins this year. While the level of outstanding sales is encouraging, small sales in the week ended 20 October and recent announcements that several importers are buying corn from other sources has created some concern about the strength of export demand for US corn.

Since 12 October, November 2011 soybean futures have traded in a range of about $.75, with a high of $12.76. That contract is now about $2.70 below the late August high. Prices have been pressured by the slow pace of domestic crush, generally favorable weather conditions in South America, and a modest pace of exports.

The USDA forecasts that exports this year will be 125 million less than the record of last year. The pace of exports and export sales are slow compared to the torrid pace of a year ago. Last year, two-thirds of US exports for the entire year had been sold by late October, as China was a large buyer early in the year.

Over 40 per cent of the total marketing year exports were shipped in the first quarter of the year and only seven per cent in the last quarter of the year. While trailing last year’s pace, export commitments as of 20 October accounted for nearly half of the USDA’s projected exports for the year. That compares to the average of only 42 per cent for the five years from 2005-06 through 2009-10.

Since 13 October, December 2011 wheat futures at Chicago have traded in a range of about $.45, with a high of $6.53. That contract is now about $1.80 below the late August high. Prices have been pressured by large production in the rest of the world, forecasts of much smaller exports, and prospects of abundant year-end stocks.

The USDA projects 2011-12 marketing year exports at 975 million bushels, 314 million less than exported last year. Exports during the first quarter of the year (June through August) were 30 million bushels larger than those of a year earlier. The USDA projection, then, implies that exports during the last three quarters will be 344 million bushels (33.6 per cent) less than those of a year ago.

As of 27 October, cumulative export inspections were only 10.5 million bushels less than the total of a year ago. Outstanding sales as of 20 October stood at only 166 million bushels, 109 million less than sales of a year earlier. Exports are clearly slowing in the face of large foreign crops.

Crop prices received some brief support from the aversion of a financial meltdown in Europe, but concerns about global economic conditions continue. The USDA’s Crop Production report on 9 November will provide updated forecasts of the size of the US corn and soybean crops. Unless those forecasts are lower than expected, crop prices may drift back to the lows established in early October.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on November 05, 2011, 09:20:53 AM
Friday, November 04, 2011
Record Corn Crop Unlikely to Meet Demand
CHINA - China reaped its seventh record corn crop in eight years during the harvest now ending. That still won't be enough to meet demand, driving a fivefold gain in imports as prices head for the highest-ever annual average.




Farmers in Shenyang, Liaoning province, harvest the corn crop. The country's demand for corn has risen 50 per cent since 2000 while the harvest grew by 38 per cent.
[Photo: China Daily]Production reached 189.2 million tons in the harvest that began in September, which was 6.7 per cent more than a year earlier, according to a survey of growers in the seven main producing regions carried out by Geneva-based SGS SA for Bloomberg. Imports in the marketing year that began last month may jump to 5 million tons from 1 million tons, according to the median estimate of 10 analysts and traders surveyed by Bloomberg.

While the supply predicted in the SGS survey would exceed the estimates of the US Department of Agriculture (USDA) by more than 7 million tons, rising imports show that farmers are failing to grow enough grain for livestock feed. The fivefold expansion in China's economy in the past decade reported by the World Bank has spurred a change in diets. The dairy herd has almost tripled since 2000, and per capita pork consumption rose 26 per cent in the nation of 1.34 billion people, USDA estimates show.

"It's an amazing crop, but demand is just too strong," said Dan Cekander, director of research at Newedge USA LLC in Chicago, who toured cornfields in Jilin Province, the top grower, during September. "Everybody has been projecting a record crop, and yet domestic prices are historically high, and the Chinese government just bought US corn."

Corn futures on the Chicago Board of Trade rose 2.3 per cent to $6.4325 a bushel this year and averaged $6.90, heading for the highest-ever annual figure.

The grain will probably reach $7.25 in the first quarter, Cekander said. Prices in Jilin jumped 17 per cent and touched a record 2,430 yuan a ton ($9.67 a bushel) on Sept 19, according to Shanghai JC Intelligence Co, the nation's biggest independent agricultural researcher.

On 13 October, the USDA announced that China bought 900,000 tons of corn, the most since a 1.45 million-ton purchase in 1994.

Corn outperformed this year's 14 per cent drop in the Standard & Poor's GSCI Agriculture Index of eight commodities and the 8.2 per cent decline in the MSCI All-Country World Index of equities. Treasuries returned 8.8 per cent, Bank of America Corp indexes show.

Chinese demand has risen 50 per cent since 2000 as output gained by 38 per cent, according to USDA data. Only the US grows and uses more. China, which became a net importer for the first time in 14 years in 2010, is "entering a golden age for consumption," Morgan Stanley analysts led by Hussein Allidina said in a report 25 October.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on November 09, 2011, 10:32:13 AM
Tuesday, November 08, 2011
Soybean Export Progress
US - Since the first of October, November 2011 soybean futures have traded in a range of $1.20, with a high of $12.72. The price of that contract is currently about in the middle of the recent trading range and $2.50 below the contract high reached on 31 August.


A number of factors have contributed to the lower prices since August and to the weakness since mid-October. These factors include early forecasts of another large South American soybean harvest in 2012. That forecast has been supported by generally favorable weather conditions in Brazil and Argentina in the early part of the planting and growing season.

A slow start to the 2011-12 marketing year domestic soybean crush and lagging soybean oil export sales have also contributed to the negative tone. In addition, concerns about world economic and financial conditions have cast a shadow over the future demand for soybeans.

The USDA’s forecast of the size of the 2011 US harvest increased by 29 million bushels in September, but the October forecast was back near the August forecast. Expectations about the November yield forecast are mixed, with the average reported expectation near the October forecast of 41.5 bushels. The forecast will be released on 9 November, with the final estimate of crop size due to be released on 12 January, 2012.

Another major negative factor for the soybean market has been the perception that export demand for US soybeans is weak. The USDA currently forecasts 2011-12 marketing year US soybean exports at 1.375 billion bushels. That is 40 million bushels below the September forecast and 125 million bushels below the record level of exports in 2009-10 and 2010-11.

The current pace of exports and export sales are certainly much slower than that of last year. Through the first nine weeks of the current marketing year, soybean export inspections totaled 257 million bushels, compared to 393 million bushels during the same period last year. Unshipped export sales of soybeans as of 27 October stood at 484.3 million bushels, compared to 752.2 million on the same date last year. Export commitments are lower for all major destinations except Mexico.

Comparison of the pace of exports and export sales this year to those of last year may not be appropriate for judging the strength of export demand. Last year, export business was concentrated in the early part of the marketing year. Exports during the first quarter of the year accounted for 41.2 per cent of the marketing year total. That compares to the average of 32 per cent in the previous five years.

Exports in the first half of the year accounted for 78 per cent of the total. That is similar to the total for the 2009-10 marketing year, but compares to a more typical 67 per cent in the period 2005-06 through 2008-09. Last year, export commitments (shipments plus outstanding sales) in late October accounted for nearly 71 per cent of marketing year exports.

China was a very aggressive buyer early in the marketing year. In the previous five years, export commitments in late October accounted for an average of 44.4 per cent of marketing year exports, in a range of 57.5 percent (2009-10) to 37.7 per cent (2005-06).

This year, export commitments as of 27 October represented 49.5 per cent of the current USDA projection of marketing year exports. Except for the past two years, commitments represent the largest percentage of actual marketing year exports since 1997-98. Commitments are 23 per cent larger than at this time in 2008-09, when marketing year exports totaled 1.279 billion bushels.

There may be reasons to be concerned about soybean export demand, but the current magnitude of sales does not appear to be particularly troublesome. The recent pace of sales, however, has been very low. To reach the USDA projection for the year, new sales will need to average 15.5 million bushels per week from November 2011 through August 2012.

For the two weeks ended 27 October, new sales averaged only eighht million bushels per week. The pace of new sales and weekly shipments need to be followed closely to gauge the potential for marketing year exports. In addition, the monthly Census Bureau export estimates should be monitored as those are the official export estimates. The estimate of September 2011 exports will be released on 10 November.

Typically, the difference between the USDA export inspection estimates and the Census Bureau estimates are small early in the year. In recent years, however, that difference has often become larger later in the marketing year. By the end of the year, Census Bureau estimates were about 40 million bushels larger than USDA inspection estimates in the three years from 2007-08 through 2009-10. Last year, Census Bureau estimates for the year exceeded export inspections by only 14 million bushels.

The USDA will release new forecasts of US and world soybean production and consumption for the current marketing year on 9 November. The market appears to be expecting the forecast of US marketing year exports to be below the October forecast. A smaller forecast seems premature based on the current status of sales and shipments.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on November 17, 2011, 07:43:34 AM
Wednesday, November 16, 2011
Positive Outlook for Aussie Grains Industry
AUSTRALIA - Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig, has welcomed the release of the Australian Grains 11.2: Grains outlook 2011–12 and industry productivity report, where the total summer crop area in 2011-12 is forecast to be 1.5 million hectares and 41 million tonnes.


The report, produced by the Australian Bureau of Agricultural and Resource Economics and Sciences, provides a summary of the outlook for crop production in Australia and analysis of productivity growth in the Australian grains industry.

Minister Ludwig said the report presented a positive outlook for the grains industry.

Minister Ludwig said: "Growing conditions over winter and spring were broadly favourable in Australia's major winter cropping regions and crops were generally reported to be in good condition.

"World wheat and coarse grains prices are forecast to remain relatively high in 2011–12 due to the relatively low availability of feed grains. Canola production is forecast to increase by seven per cent in 2011–12 to around 2.3 million tonnes.

"World oilseed prices are forecast to increase as a result of increased imports by China, higher oilseed crush, and growth in feed demand from livestock industries."

Rainfall of 25 to 100 millimetres was recorded in each of the winter months and boosted yield prospects, with crops looking promising across the states’ cropping zones.

Minister Ludwig continued: "Rainfall in late August and September replenished soil-moisture profiles and provided a good boost to crops in most regions.

"Increased availability of irrigation water is forecast to result in higher cotton and rice plantings.

"However, production will be down in some areas of Western Australia due to continuing dry conditions."

Total factor productivity growth for the cropping industry as a whole increased on average by 1.9 per cent a year between 1977–78 and 2008–09, while the estimated productivity growth in the mixed crop–livestock industry was 1.4 per cent a year.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 11, 2011, 09:23:50 AM

More Wheat and Canola in Canada, Less Corn and Soybean
08 December 2011
CANADA - Canadian grain producers harvested more canola and wheat this year than last, Statistics Canada reported Tuesday in its third and final estimates of this year’s Canadian crop. Barley output was up slightly - corn and soybean production were all down from 2010.

Corn / Maize, Soy, Wheat, Harvest
 


“In the West, farmers reported that hot, sunny weather during the summer helped them recover from a damp and late spring in certain areas. Similarly, weather patterns in the East returned to normal after a particularly wet spring, especially in Quebec’s Richelieu river valley,” the federal agency said when it published the results of its survey of 28,600 Canadian farmers.
 
Production of all Canadian wheats – spring, durum plus winter – were up on 2010, totaling 25.3 million metric tons. Canola production hit record levels.
 
In the wheat fields, total production was 9 per cent higher than last year, mostly because of a strong (5.5 per cent) increase in wheat yields in Saskatchewan and Alberta.
 
“A significant contributor to the overall production increase was durum wheat. Durum wheat production increased 36.4 per cent in Saskatchewan to 3.6 million tonnes and 47.1 per cent in Alberta to 620,500 tonnes. These increases followed substantial declines from 2009 to 2010,” Statistics Canada said.
 
In the west, canola production climbed by more than 10 per cent year on year to a record 14 million tonnes. Statistics Canada attributed this mostly to an increase in canola acreage, coupled with slightly higher yields. Canola production was up in Saskatchewan and Alberta, but down for a second year in Manitoba where farmers battled spring floods.
 
Canadian farmers harvested 7.756 million metric tons of barley, up 2 per cent from last year. This is still well back of 2009 production levels.
 
Lower yields cut into soybean production in Manitoba, Ontario and Quebec. Acreage in some provinces were at record levels.
 
“Ontario soybean production amounted to 3.0 million tonnes, a decline of 2.7 per cent or 81,600 tonnes from the all-time high set in 2010,” the federal agency said. “In Quebec, soybean production declined 0.9 per cent to 800,000 tonnes despite a record harvested area of 738,800 acres.”
 
Corn production was off in both Ontario and Quebec.
 
“With respect to corn for grain, Ontario production was down 6.6 per cent or 508,100 tonnes from 2010 to 7.2 million tonnes. Quebec production was down 14.1 per cent or 480,000 tonnes from 2010 to 2.9 million tonnes,” Statistics Canada said.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 17, 2011, 09:02:54 AM
Feed Outlook – December 2011
World 2011/12 corn production is forecast up 8.5 million tons this month to a record 868 million tons, mostly due to a large increase in China's production based on recently published government estimates, according to Tom Capehart and Edward Allen in the latest report from the USDA Economic Research Service.



Summary
World 2011/12 corn production is forecast up 8.5 million tons this month to a record 868 million tons, mostly due to a large increase in China’s production based on recently published government estimates. Global ending stocks are boosted six million tons to 127 million, down just one million from the previous year.

US feed grain supplies are increased slightly this month due to an increase in forecast oats imports from Canada, where supplies are plentiful. Expected corn use is down five million bushels due to reduced prospects for use in sweeteners. These changes are reflected in higher ending stocks. Sorghum export prospects are reduced due to very slow export sales, and feed and residual is raised. Forecast prices received by farmers are lowered for corn, sorghum, and barley.


DOMESTIC OUTLOOK

Feed Grain Use Slips on Lower Food Seed and Industrial Use
Forecast US feed grain supplies are edged upward, reflecting an increase in expected oats imports due to larger supplies in Canada and the strong pace of US imports in recent months. US feed grain supplies for 2011/12 are forecast at 357.6 million tons, compared with 380.5 million in 2010/11. Imports are forecast at 2.2 million tons, slightly higher than last month’s forecast. Production is unchanged this month.

Forecast US feed grain use is lowered slightly to 333.5 million metric tons. Lower forecast corn food, seed and industrial use accounts for the fractional decline.

Feed Use
On a September-August marketing year basis for 2011/12, US feed and residual use for the four feed grains plus wheat is projected to total 126.5 million tons, up slightly this month due to increased sorghum feed and residual use. Corn is expected to account for 92 percent of feed and residual use, compared with 94 percent last year.

The projected index of grain-consuming animal units (GCAU) in 2011/12 is 93.3 million units, virtually unchanged from last month and slightly higher than last season’s 92.9 million. Feed and residual per GCAU is estimated at 1.37 tons, compared with 1.39 tons in 2010/11. In the major index components, GCAUs are increased this month for cattle on feed and lowered for broilers.

Forecasts for US beef and turkey production are unchanged this month but broiler production is forecast lower, largely due to slower expected growth in average bird weights in the first part of 2012.

USDA’s November Cattle on Feed report indicated October placements in feedlots were one per cent below a year earlier but one per cent ahead of September placements. Cattle and calves on feed for slaughter in the United States in feedlots with capacity of 1,000 or more head totalled 11.9 million head on 1 November 2011. The inventory was four per cent above 1 November 2010. This is the second highest inventory on 1 November since the series began in 1996. Higher feed demand is expected despite high feed prices but lighter cattle weights may reduce some of the impact from the larger inventories.

This month, pork production was forecast higher as slightly higher carcass weights are expected. Federal-inspected average dressed weight of hogs in October was up slightly from September and up from 2010. Pork production was raised slightly for both 2011 and 2012. Higher feed costs are anticipated to moderate the increase in carcass weights by mid-2012.

Milk cow inventory on farms in the 23 major producing states was 8.48 million head, 111,000 more than October 2010, and 10,000 more than September 2011. Production per cow in the 23 major states averaged 1,787 pounds in October, 20 pounds above October 2010. Feed use for dairy is expected to advance slightly through mid-2012 as cow numbers and production per cow continue to increase. Milk production forecasts for 2011 and 2012 are raised slightly, reflecting higher growth in milk per cow and slightly higher cow numbers in 2012.

Corn Price Lowered
The forecast US corn price received by farmers for 2011/12 is reduced by $0.30 per bushel on both the high and low end of the range to $5.90 to $6.90 per bushel, reflecting recent market trends and abundant foreign supplies of corn and feed quality wheat. The season average price received by farmers in 2010/11 was $5.18 per bushel. Food, seed and industrial (FSI) use is lowered five million bushels due to lower expected first-quarter use for high fructose corn syrup (HFCS) due to the reduced export pace in recent months. The change in FSI is reflected in an increase in ending stocks to 848 million bushels, compared with last month’s 843 million. Total use is forecast at 12,605 million bushels, compared with 13,054 million in 2010/11.






Sorghum
Forecast 2011/12 US sorghum exports are lowered 20 million bushels, reflecting slowing year-to-date sales and shipments. Feed and residual use is raised by the same volume, leaving ending stocks unchanged.

Reflecting the lower corn price forecast this month, the projected sorghum price received by farmers for 2011/12 is also reduced $0.30 per bushel on both ends of the range, resulting in a forecast of $5.70 to $6.70 per bushel. The season average price received by farmers in 2010/11 was $5.02 per bushel.

Minor Changes for Oats and Barley
Forecast 2011/12 US oats imports are raised five million bushels to 95 million, reflecting abundant supplies in Canada due to a large crop and the strong US import pace in recent months. The increase results in higher projected ending stocks.

The projected range for 2011/12 oats prices received by farmers is narrowed $0.05 per bushel on each end to $3.20 to $3.60 per bushel. The season-average price received by farmers in 2010/11 was $2.52 per bushel.

There are no supply and use changes for barley this month. Forecast grower prices were reduced $0.25 on the upper end of the range and $0.15 on the lower end, for a 2011/12 forecast of $5.20 to $5.80 per bushel. The price reduction mostly reflects lower-than-expected malting barley prices to date. The 2010/11 season average farm price for barley in 2010/11 was $3.86 per bushel.


INTERNATIONAL OUTLOOK

Large Corn Crop in China Boosts Global Production
World 2011/12 coarse grain production is projected up 9.4 million tons this month to a record 1,145.2 million, mostly due to higher corn production reported for China. Foreign corn production is up 8.5 million tons to 554.8 million, foreign sorghum production is increased 0.6 million to 55.3 million, and foreign barley and oats production are each boosted 0.1 million tons to 129.9 million and 22.0 million, respectively.

China’s National Bureau of Statistics released estimates of national corn production this month, many months earlier than usual and with provincial detail for total grain. Both area and yield are increased from earlier projections, boosting 2011/12 production 7.25 million tons to a record 191.75 million. Area is up 0.2 million hectares this month to 33.4 million, a three per cent increase from the previous year. China’s corn area has increased for eight consecutive years. Good returns for planting corn have supported corn replacing other crops, especially soybeans.

The provincial data indicate strong area expansion in Inner Mongolia and Heilongjiang, the northern and western edge of corn production in China. Rainfall and temperatures through the growing season were mostly favourable, supporting record corn yields, up three per cent this month to 5.74 tons per hectare, and five per cent higher than a year ago. Satellite imagery, rainfall and temperature data confirm good crop conditions through the growing season in most areas, though there was dryness in Heilongjiang and some other parts of the Northeast during the late summer and fall. An overview of growing conditions for corn in China for 2011 indicates good but not exceptionally favourable, rainfall and temperatures. However, it is exceptional that a country as large as China had no corn areas with significant floods or drought.


The European Union (EU) corn crop is up 1.0 million tons this month to a record 63.9 million, as several countries revised production estimates based on harvest reports. The largest increase was reported for Romania; Bulgaria, France and Spain also had significant increases; Italy and the Czech Republic had small increases; and Hungary had a decline. Corn yields for the EU are record high, with favourable rains during key growth stages in most countries, with the exception of Hungary, which suffered from dry conditions. Serbia (not part of the EU but Hungary’s neighbour) also reported a slight reduction in corn production this month.

Canada’s corn production is up 0.7 million tons this month to 10.7 million. Statistics Canada published a production estimate based on harvest results that showed better yields than earlier expected. The delayed development of the crop caused by cool wet conditions in most of Ontario did not hurt corn yields as much as expected but the yield remains down eight per cent from the previous year’s record.

Corn production in Belarus is forecast down 0.4 million tons to 1.2 million this month as less-than-record yields are confirmed by government reports. Area and production remain at record levels.

Brazil reported larger sorghum area and production for both 2010/11 and 2011/12. Sorghum is used in parts of the Center-West of Brazil as a “cover crop” to protect soils from exposure to the sun during the dry season, and area is being maintained despite the relatively low grain yields. Sorghum production is raised 0.5 million tons for both years, to 2.2 million for 2011/12 and 2.3 million for 2010/11.

Australia’s sorghum production projected for 2011/12, still being planted, is up 0.2 million tons this month to 2.4 million. Good soil moisture and prices support area and yield prospects. However, for South Africa, sorghum production is cut 0.1 million tons to 0.1 million as area being planted is reported down significantly. South Africa’s barley yield prospects are slightly higher this month.

Australian yield reports boosted barley production 0.3 million tons to 8.5 million while increasing oats fractionally and reducing corn slightly. Statistics Canada reported lower barley yields, trimming production 0.1 million tons to 7.8 million but oats area was increased, boosting production 0.1 million to 3.0 million. There are also small reductions this month for Morocco’s barley and Mexico’s oats.

Reduced Beginning Stocks Partly Offset Increased Production
World coarse grain beginning stocks for 2011/12 are down 1.9 million tons this month to 166.2 million, partly offsetting the 9.4-million ton increase in production. Barley stocks are cut 0.8 million tons to 25.4 million, corn stocks are reduced 0.8 million to 128.3 million, rye stocks are trimmed 0.2 million tons to 1.8 million, and oats and sorghum are reduced slightly.

The Australian Bureau of Statistics revised 2010/11 barley production down significantly, cutting 2011/12 beginning stocks 1.2 million tons to 1.1 million. Instead of building barley stocks during 2010/11, as previously expected, Australia is now estimated to have reduced stock-holding. The drop in Australia’s 2011/12 barley beginning stocks more than offset a 0.3-million-ton increase for Belarus and small increases for Brazil, South Africa, and China.

South Africa’s corn beginning stocks for 2011/12 are down 0.8 million tons this month to 2.8 million, as the previous year’s production is estimated lower based on actual deliveries to market and estimated farm use and stocks retained by producers. Small increases for Belarus and Australia and a reduction for Argentina are comparatively insignificant. Rye stocks are reduced mostly for Belarus and Russia, oats are reduced slightly in Belarus and Australia, and sorghum is reduced in Australia and Mexico but raised in Brazil.

Global Coarse Grain Use Projected Higher
World coarse grain consumption for 2011/12 is forecast up 1.9 million tons this month to 1,150.7 million tons. Feed and residual use is projected up 2.1 million tons to 662.9 million, but food, seed and industrial use prospects are reduced. Most of the increased forecast use is corn and sorghum, with reductions for barley, oats and rye.

The largest increase in coarse grain use this month is for corn in China, with the 2011/12 feed and residual use increased 2.0 million tons to 134.0 million. Corn prices in China remain relatively high despite the very large harvest, evidence of strong demand. With the larger crop, corn use in Canada is boosted 0.5 million tons to 11.5 million, with 0.3 million of the increase in feed use and 0.2 million in food, seed and industrial use. Reductions in expected corn use in Belarus, the United States, South Africa and Australia are partly offsetting.

Global sorghum use for 2011/12 is projected up 0.6 million tons to 62.1 million, with increased feed use more than offsetting a small decline in food, seed and industrial use. Brazil’s feed use is up 0.5 million tons, almost the same as the US increase. Partly offsetting are decreases for Mexico, down 0.3 million tons, where sorghum is reportedly being replaced by imported wheat, and for South Africa, with reduced production prospects expected to limit food use.

Barley feed use in Ukraine is reduced 0.5 million tons to 2.9 million. With abundant supplies of other grains that can be used for feed, barley stocks are not expected to decline in 2011/12, so projected use was trimmed to meet stock expectations. Australia’s barley feed use is projected 0.1 million tons lower this month to 3.4 million due to tight beginning stocks and ample feed-quality wheat supplies. These decreases in barley feed use are partly offset by increased feed use projected for Belarus, up 0.2 million tons to 1.4 million tons due to increased supplies.

Oats use in 2011/12 is forecast lower this month for Canada, Belarus, and Mexico; rye use is projected lower for Russia, Belarus and the United States.

Global Coarse Grain Ending Stocks Prospects Increased but Still Tight
World coarse grain ending stocks for 2011/12 are up 5.5 million tons to 160.7 million, mostly due to increased corn stocks in China. China’s corn ending stocks are up 5.3 million tons to 57.0 million because the bumper crop is expected to facilitate the holding of corn as a hedge against future price increases. Other increases in corn ending stocks are for the EU, up 0.5 million tons due to the record corn crop; Serbia, up 0.4 million because of problems moving exports with low water on the Danube; and Canada, up 0.2 million due to increased production. The United States and Australia had smaller increases. Partly offsetting are reductions for South Africa, down 0.7 million tons due to reduced supplies and for Belarus and Argentina down by smaller amount.

World barley ending stocks are reduced 0.3 million tons to 22.6 million, with reductions for Russia (-0.4 million tons), Australia (-0.4 million), Argentina (-0.2 million), Canada (-0.1 million), and Morocco (small increase) more than offsetting increases projected for Ukraine (+0.5 million), Algeria (+0.2 million) and Belarus, South Africa and Brazil (small increases).

Oats ending stocks in Canada and rye ending stocks for Russia are each increased 0.1 million tons for 2011/12, accounting for most of the changes in global stocks for those grains. Changes in projected sorghum ending stocks are small, with declines for Australia, Mexico, South Africa and Japan, but an increase for Brazil.

World Corn Trade Prospects Reduced Slightly; US Exports Unchanged
Global corn trade projected for 2011/12 (October-September) is reduced 0.4 million tons this month to 94.0 million. EU corn import prospects are reduced 0.5 million tons to 3.0 million because of increased production and the slow pace of import licences. Serbia’s corn export prospects are cut 0.4 million tons to 1.6 million as low water in the Danube River has complicated logistics for moving grain, and slack EU import demand reduces the urgency of shipments and limits the willingness of importers to pay extra for alternative freight.


US corn exports for 2011/12 remain projected to reach 41.0 million tons (1.6 billion bushels for the September-August local marketing year). While US exports for October 2011 were reported by Census down eight per cent from a year earlier at 3.2 million tons, the November corn export inspections reached 3.8 million, an increase of 0.5 million tons over a year ago. As of 1 December 2011, outstanding sales were 12.8 million tons, up three per cent from the previous year. The 2011/12 forecast is down nine per cent from 2010/11, implying a significant slowdown in additional sales and shipments. Tight US corn supplies, relatively high US corn prices and competition from abundant feed-quality wheat in foreign markets are expected.

US sorghum exports for 2011/12 are reduced 0.5 million tons to 1.9 million – down 20 million bushels to 70 million for the September-August local marketing year. US sorghum supplies are tight because of a small crop, limiting export sales. As of 1 December 2011, outstanding sales reached only 187,400 tons, down from 720,700 a year ago. Prospects for an increase in sorghum sales seem limited as Mexico has turned to cheaper wheat to replace sorghum imports. Mexico’s sorghum imports for 2011/12 are reduced 0.3 million tons this month to 1.8 million. Australia’s sorghum export projection is increased 0.2 million tons to 1.2 million as a larger crop combines with prospects for a stronger share of Japan’s sorghum imports.

The five-million-bushel US oats import increase for the June-May 2011/12 local marketing year was due to strong shipments for the period July to September and is reflected in the 2010/11 October-September international trade year. With increased production this month, Canada’s oats export prospects for 2011/12 are increased slightly.

World barley trade for 2011/12 is projected slightly higher this month due to an increase in import demand from Algeria, doubling to 0.5 million tons this month. With a smaller crop, Australia’s barley export prospects are reduced but exports for Russia and Argentina are increased because of strong sales.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 21, 2011, 09:56:35 AM
Feed Outlook - December 2011
World 2011/12 corn production is forecast up 8.5 million tons this month to a record 868 million tons, mostly due to a large increase in China's production based on recently published government estimates, according to Tom Capehart and Edward Allen in the latest report from the USDA Economic Research Service.

 

Summary
World 2011/12 corn production is forecast up 8.5 million tons this month to a record 868 million tons, mostly due to a large increase in China’s production based on recently published government estimates. Global ending stocks are boosted six million tons to 127 million, down just one million from the previous year.

US feed grain supplies are increased slightly this month due to an increase in forecast oats imports from Canada, where supplies are plentiful. Expected corn use is down five million bushels due to reduced prospects for use in sweeteners. These changes are reflected in higher ending stocks. Sorghum export prospects are reduced due to very slow export sales, and feed and residual is raised. Forecast prices received by farmers are lowered for corn, sorghum, and barley.


DOMESTIC OUTLOOK

Feed Grain Use Slips on Lower Food Seed and Industrial Use
Forecast US feed grain supplies are edged upward, reflecting an increase in expected oats imports due to larger supplies in Canada and the strong pace of US imports in recent months. US feed grain supplies for 2011/12 are forecast at 357.6 million tons, compared with 380.5 million in 2010/11. Imports are forecast at 2.2 million tons, slightly higher than last month’s forecast. Production is unchanged this month.

Forecast US feed grain use is lowered slightly to 333.5 million metric tons. Lower forecast corn food, seed and industrial use accounts for the fractional decline.

Feed Use
On a September-August marketing year basis for 2011/12, US feed and residual use for the four feed grains plus wheat is projected to total 126.5 million tons, up slightly this month due to increased sorghum feed and residual use. Corn is expected to account for 92 percent of feed and residual use, compared with 94 percent last year.

The projected index of grain-consuming animal units (GCAU) in 2011/12 is 93.3 million units, virtually unchanged from last month and slightly higher than last season’s 92.9 million. Feed and residual per GCAU is estimated at 1.37 tons, compared with 1.39 tons in 2010/11. In the major index components, GCAUs are increased this month for cattle on feed and lowered for broilers.

Forecasts for US beef and turkey production are unchanged this month but broiler production is forecast lower, largely due to slower expected growth in average bird weights in the first part of 2012.

USDA’s November Cattle on Feed report indicated October placements in feedlots were one per cent below a year earlier but one per cent ahead of September placements. Cattle and calves on feed for slaughter in the United States in feedlots with capacity of 1,000 or more head totalled 11.9 million head on 1 November 2011. The inventory was four per cent above 1 November 2010. This is the second highest inventory on 1 November since the series began in 1996. Higher feed demand is expected despite high feed prices but lighter cattle weights may reduce some of the impact from the larger inventories.

This month, pork production was forecast higher as slightly higher carcass weights are expected. Federal-inspected average dressed weight of hogs in October was up slightly from September and up from 2010. Pork production was raised slightly for both 2011 and 2012. Higher feed costs are anticipated to moderate the increase in carcass weights by mid-2012.

Milk cow inventory on farms in the 23 major producing states was 8.48 million head, 111,000 more than October 2010, and 10,000 more than September 2011. Production per cow in the 23 major states averaged 1,787 pounds in October, 20 pounds above October 2010. Feed use for dairy is expected to advance slightly through mid-2012 as cow numbers and production per cow continue to increase. Milk production forecasts for 2011 and 2012 are raised slightly, reflecting higher growth in milk per cow and slightly higher cow numbers in 2012.

Corn Price Lowered
The forecast US corn price received by farmers for 2011/12 is reduced by $0.30 per bushel on both the high and low end of the range to $5.90 to $6.90 per bushel, reflecting recent market trends and abundant foreign supplies of corn and feed quality wheat. The season average price received by farmers in 2010/11 was $5.18 per bushel. Food, seed and industrial (FSI) use is lowered five million bushels due to lower expected first-quarter use for high fructose corn syrup (HFCS) due to the reduced export pace in recent months. The change in FSI is reflected in an increase in ending stocks to 848 million bushels, compared with last month’s 843 million. Total use is forecast at 12,605 million bushels, compared with 13,054 million in 2010/11.






Sorghum
Forecast 2011/12 US sorghum exports are lowered 20 million bushels, reflecting slowing year-to-date sales and shipments. Feed and residual use is raised by the same volume, leaving ending stocks unchanged.

Reflecting the lower corn price forecast this month, the projected sorghum price received by farmers for 2011/12 is also reduced $0.30 per bushel on both ends of the range, resulting in a forecast of $5.70 to $6.70 per bushel. The season average price received by farmers in 2010/11 was $5.02 per bushel.

Minor Changes for Oats and Barley
Forecast 2011/12 US oats imports are raised five million bushels to 95 million, reflecting abundant supplies in Canada due to a large crop and the strong US import pace in recent months. The increase results in higher projected ending stocks.

The projected range for 2011/12 oats prices received by farmers is narrowed $0.05 per bushel on each end to $3.20 to $3.60 per bushel. The season-average price received by farmers in 2010/11 was $2.52 per bushel.

There are no supply and use changes for barley this month. Forecast grower prices were reduced $0.25 on the upper end of the range and $0.15 on the lower end, for a 2011/12 forecast of $5.20 to $5.80 per bushel. The price reduction mostly reflects lower-than-expected malting barley prices to date. The 2010/11 season average farm price for barley in 2010/11 was $3.86 per bushel.


INTERNATIONAL OUTLOOK

Large Corn Crop in China Boosts Global Production
World 2011/12 coarse grain production is projected up 9.4 million tons this month to a record 1,145.2 million, mostly due to higher corn production reported for China. Foreign corn production is up 8.5 million tons to 554.8 million, foreign sorghum production is increased 0.6 million to 55.3 million, and foreign barley and oats production are each boosted 0.1 million tons to 129.9 million and 22.0 million, respectively.

China’s National Bureau of Statistics released estimates of national corn production this month, many months earlier than usual and with provincial detail for total grain. Both area and yield are increased from earlier projections, boosting 2011/12 production 7.25 million tons to a record 191.75 million. Area is up 0.2 million hectares this month to 33.4 million, a three per cent increase from the previous year. China’s corn area has increased for eight consecutive years. Good returns for planting corn have supported corn replacing other crops, especially soybeans.

The provincial data indicate strong area expansion in Inner Mongolia and Heilongjiang, the northern and western edge of corn production in China. Rainfall and temperatures through the growing season were mostly favourable, supporting record corn yields, up three per cent this month to 5.74 tons per hectare, and five per cent higher than a year ago. Satellite imagery, rainfall and temperature data confirm good crop conditions through the growing season in most areas, though there was dryness in Heilongjiang and some other parts of the Northeast during the late summer and fall. An overview of growing conditions for corn in China for 2011 indicates good but not exceptionally favourable, rainfall and temperatures. However, it is exceptional that a country as large as China had no corn areas with significant floods or drought.


The European Union (EU) corn crop is up 1.0 million tons this month to a record 63.9 million, as several countries revised production estimates based on harvest reports. The largest increase was reported for Romania; Bulgaria, France and Spain also had significant increases; Italy and the Czech Republic had small increases; and Hungary had a decline. Corn yields for the EU are record high, with favourable rains during key growth stages in most countries, with the exception of Hungary, which suffered from dry conditions. Serbia (not part of the EU but Hungary’s neighbour) also reported a slight reduction in corn production this month.

Canada’s corn production is up 0.7 million tons this month to 10.7 million. Statistics Canada published a production estimate based on harvest results that showed better yields than earlier expected. The delayed development of the crop caused by cool wet conditions in most of Ontario did not hurt corn yields as much as expected but the yield remains down eight per cent from the previous year’s record.

Corn production in Belarus is forecast down 0.4 million tons to 1.2 million this month as less-than-record yields are confirmed by government reports. Area and production remain at record levels.

Brazil reported larger sorghum area and production for both 2010/11 and 2011/12. Sorghum is used in parts of the Center-West of Brazil as a “cover crop” to protect soils from exposure to the sun during the dry season, and area is being maintained despite the relatively low grain yields. Sorghum production is raised 0.5 million tons for both years, to 2.2 million for 2011/12 and 2.3 million for 2010/11.

Australia’s sorghum production projected for 2011/12, still being planted, is up 0.2 million tons this month to 2.4 million. Good soil moisture and prices support area and yield prospects. However, for South Africa, sorghum production is cut 0.1 million tons to 0.1 million as area being planted is reported down significantly. South Africa’s barley yield prospects are slightly higher this month.

Australian yield reports boosted barley production 0.3 million tons to 8.5 million while increasing oats fractionally and reducing corn slightly. Statistics Canada reported lower barley yields, trimming production 0.1 million tons to 7.8 million but oats area was increased, boosting production 0.1 million to 3.0 million. There are also small reductions this month for Morocco’s barley and Mexico’s oats.

Reduced Beginning Stocks Partly Offset Increased Production
World coarse grain beginning stocks for 2011/12 are down 1.9 million tons this month to 166.2 million, partly offsetting the 9.4-million ton increase in production. Barley stocks are cut 0.8 million tons to 25.4 million, corn stocks are reduced 0.8 million to 128.3 million, rye stocks are trimmed 0.2 million tons to 1.8 million, and oats and sorghum are reduced slightly.

The Australian Bureau of Statistics revised 2010/11 barley production down significantly, cutting 2011/12 beginning stocks 1.2 million tons to 1.1 million. Instead of building barley stocks during 2010/11, as previously expected, Australia is now estimated to have reduced stock-holding. The drop in Australia’s 2011/12 barley beginning stocks more than offset a 0.3-million-ton increase for Belarus and small increases for Brazil, South Africa, and China.

South Africa’s corn beginning stocks for 2011/12 are down 0.8 million tons this month to 2.8 million, as the previous year’s production is estimated lower based on actual deliveries to market and estimated farm use and stocks retained by producers. Small increases for Belarus and Australia and a reduction for Argentina are comparatively insignificant. Rye stocks are reduced mostly for Belarus and Russia, oats are reduced slightly in Belarus and Australia, and sorghum is reduced in Australia and Mexico but raised in Brazil.

Global Coarse Grain Use Projected Higher
World coarse grain consumption for 2011/12 is forecast up 1.9 million tons this month to 1,150.7 million tons. Feed and residual use is projected up 2.1 million tons to 662.9 million, but food, seed and industrial use prospects are reduced. Most of the increased forecast use is corn and sorghum, with reductions for barley, oats and rye.

The largest increase in coarse grain use this month is for corn in China, with the 2011/12 feed and residual use increased 2.0 million tons to 134.0 million. Corn prices in China remain relatively high despite the very large harvest, evidence of strong demand. With the larger crop, corn use in Canada is boosted 0.5 million tons to 11.5 million, with 0.3 million of the increase in feed use and 0.2 million in food, seed and industrial use. Reductions in expected corn use in Belarus, the United States, South Africa and Australia are partly offsetting.

Global sorghum use for 2011/12 is projected up 0.6 million tons to 62.1 million, with increased feed use more than offsetting a small decline in food, seed and industrial use. Brazil’s feed use is up 0.5 million tons, almost the same as the US increase. Partly offsetting are decreases for Mexico, down 0.3 million tons, where sorghum is reportedly being replaced by imported wheat, and for South Africa, with reduced production prospects expected to limit food use.

Barley feed use in Ukraine is reduced 0.5 million tons to 2.9 million. With abundant supplies of other grains that can be used for feed, barley stocks are not expected to decline in 2011/12, so projected use was trimmed to meet stock expectations. Australia’s barley feed use is projected 0.1 million tons lower this month to 3.4 million due to tight beginning stocks and ample feed-quality wheat supplies. These decreases in barley feed use are partly offset by increased feed use projected for Belarus, up 0.2 million tons to 1.4 million tons due to increased supplies.

Oats use in 2011/12 is forecast lower this month for Canada, Belarus, and Mexico; rye use is projected lower for Russia, Belarus and the United States.

Global Coarse Grain Ending Stocks Prospects Increased but Still Tight
World coarse grain ending stocks for 2011/12 are up 5.5 million tons to 160.7 million, mostly due to increased corn stocks in China. China’s corn ending stocks are up 5.3 million tons to 57.0 million because the bumper crop is expected to facilitate the holding of corn as a hedge against future price increases. Other increases in corn ending stocks are for the EU, up 0.5 million tons due to the record corn crop; Serbia, up 0.4 million because of problems moving exports with low water on the Danube; and Canada, up 0.2 million due to increased production. The United States and Australia had smaller increases. Partly offsetting are reductions for South Africa, down 0.7 million tons due to reduced supplies and for Belarus and Argentina down by smaller amount.

World barley ending stocks are reduced 0.3 million tons to 22.6 million, with reductions for Russia (-0.4 million tons), Australia (-0.4 million), Argentina (-0.2 million), Canada (-0.1 million), and Morocco (small increase) more than offsetting increases projected for Ukraine (+0.5 million), Algeria (+0.2 million) and Belarus, South Africa and Brazil (small increases).

Oats ending stocks in Canada and rye ending stocks for Russia are each increased 0.1 million tons for 2011/12, accounting for most of the changes in global stocks for those grains. Changes in projected sorghum ending stocks are small, with declines for Australia, Mexico, South Africa and Japan, but an increase for Brazil.

World Corn Trade Prospects Reduced Slightly; US Exports Unchanged
Global corn trade projected for 2011/12 (October-September) is reduced 0.4 million tons this month to 94.0 million. EU corn import prospects are reduced 0.5 million tons to 3.0 million because of increased production and the slow pace of import licences. Serbia’s corn export prospects are cut 0.4 million tons to 1.6 million as low water in the Danube River has complicated logistics for moving grain, and slack EU import demand reduces the urgency of shipments and limits the willingness of importers to pay extra for alternative freight.


US corn exports for 2011/12 remain projected to reach 41.0 million tons (1.6 billion bushels for the September-August local marketing year). While US exports for October 2011 were reported by Census down eight per cent from a year earlier at 3.2 million tons, the November corn export inspections reached 3.8 million, an increase of 0.5 million tons over a year ago. As of 1 December 2011, outstanding sales were 12.8 million tons, up three per cent from the previous year. The 2011/12 forecast is down nine per cent from 2010/11, implying a significant slowdown in additional sales and shipments. Tight US corn supplies, relatively high US corn prices and competition from abundant feed-quality wheat in foreign markets are expected.

US sorghum exports for 2011/12 are reduced 0.5 million tons to 1.9 million – down 20 million bushels to 70 million for the September-August local marketing year. US sorghum supplies are tight because of a small crop, limiting export sales. As of 1 December 2011, outstanding sales reached only 187,400 tons, down from 720,700 a year ago. Prospects for an increase in sorghum sales seem limited as Mexico has turned to cheaper wheat to replace sorghum imports. Mexico’s sorghum imports for 2011/12 are reduced 0.3 million tons this month to 1.8 million. Australia’s sorghum export projection is increased 0.2 million tons to 1.2 million as a larger crop combines with prospects for a stronger share of Japan’s sorghum imports.

The five-million-bushel US oats import increase for the June-May 2011/12 local marketing year was due to strong shipments for the period July to September and is reflected in the 2010/11 October-September international trade year. With increased production this month, Canada’s oats export prospects for 2011/12 are increased slightly.

World barley trade for 2011/12 is projected slightly higher this month due to an increase in import demand from Algeria, doubling to 0.5 million tons this month. With a smaller crop, Australia’s barley export prospects are reduced but exports for Russia and Argentina are increased because of strong sales.



December 2011
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 24, 2011, 11:49:11 AM
Oil Crops Outlook – December 2011
Based on higher competition and uniformly disappointing sales, USDA lowered its 2011/12 forecast of U.S. soybean exports by 25 million bushels this month to 1.3 billion.

Domestic soybean crush is also forecast down this month—by 10 million bushels to an 8-year low of 1.625 billion. Thus, U.S. season-ending stocks are seen edging up to a 5-year high of 230 million bushels from 215 million last year. The 2011/12 average farm price is forecast by USDA down to $10.70-$12.70 per bushel from $11.60-$13.60 per bushel last month.

Given heavy shipments of soybeans from Brazil this fall, USDA raised its 2011/12 export forecast for the country to 38.5 million metric tons from 38 million last month. For the EU-27, forecasts of 2011/12 imports were lowered to 12.3 million tons for soybeans and 22.6 million tons for soybean meal as a more abundant and inexpensive supply of feed wheat there suppresses soybean meal use.


DOMESTIC OUTLOOK
Drop in U.S. Export Sales of Soybeans Portends Higher Ending Stocks, Lower Prices
U.S. export sales and shipments of soybeans for 2011/12 have been disappointing. According to USDA’s Export Sales report, soybean shipments through December 1 were down by one-third from a year earlier. There is little optimism for an improvement in the pace of upcoming shipments as the year-to-year decline for the outstanding sales is about the same. USDA considered that evidence in lowering its 2011/12 forecast of U.S. soybean exports by 25 million bushels this month to 1.3 billion. If realized, this would be only the second year ever that U.S. soybean exports are surpassed by shipments from Brazil. Although China accounts for a large part of the lost sales, it is not the only import market where U.S. sales have slipped. Sales commitments to the European Union (not long ago the top market for U.S. soybean exports) have collapsed by 75 percent this season.

In addition, the forecast of the domestic soybean crush is lowered this month by 10 million bushels—to an 8-year low of 1.625 billion. The estimated crush for September-October 2011 may have already fallen off by 25 million bushels against the 2010/11 pace (which totaled 1.648 billion bushels for the complete marketing year). Higher estimates of the extraction rates for soybean meal and soybean oil are seen satisfying current demand for both products at a lower rate of soybean crushing.

The expected reduction in soybean demand for 2011/12 would now exceed the decline in the supply. Consequently, season-ending stocks are seen edging up to a 5-year high of 230 million bushels from 215 million last year.

A dimmer demand outlook has pressured the price of soybeans to its lowest level in a year. In November, U.S. farmers received an average soybean price of $11.50 per bushel, down from $11.70 per bushel in October and $12.20 in September. Price direction for the next several months may hinge on how well the new crop in South America develops. The crop-year average farm price is forecast by USDA at $10.70-$12.70 per bushel, compared to last month’s forecast at $11.60-$13.60 per bushel.


Setbacks for U.S. Poultry Sector Undermine Prospects for Domestic Soybean Meal Use
This month, USDA lowered its forecast of domestic soybean meal use by 150,000 short tons to 30.1 million, down from the 2010/11 estimate of 30.3 million. This decline is primarily associated with adverse economic conditions for the broiler chicken industry. This sector, which uses more soybean meal than producers of any other meat animals, is suffering from high feed costs and poor consumer demand. The ratio of a broiler chicken’s value to its feed costs this year is the lowest since 1983. That explains a declining rate of broiler egg hatching and chick placements this fall. Year-to-year reductions in U.S. broiler chicken production are expected to exceed 5 percent in the fourth quarter of 2011 and 4 percent for the next 3 quarters.

Conditions for U.S. hog producers are better. Modest production growth is anticipated for hogs over the next year, although it may not compensate for the loss of soybean meal consumption by broiler chickens. Feed demand for soybean meal will also be constrained this year by higher supplies of other proteins, particularly canola meal.

Also, U.S. export sales of soybean meal on December 1 were down 12 percent compared to a year earlier. For 2011/12, a decline in soybean meal exports to 8.8 million short tons is expected from 9.1 million last year. Subdued demand in both domestic and foreign markets has pushed down central Illinois prices for soybean meal to a 3-year low in November, with the average price declining to $290 per short ton from $301 in October. The season-average price for soybean meal is forecast lower this month to $280-$310 per short ton compared to $310-$340 last month.


High Soybean Oil Prices Deter U.S. Export Sales
Despite this month’s reduction for the expected 2011/12 soybean crush, the impact on this year’s soybean oil supply is offset by a higher forecast of the soybean oil extraction rate. Total output of soybean oil for the season is forecast 100 million pounds higher this month to 18.77 billion pounds, which would be only 0.6 percent below last year’s production.

Even though U.S. soybean oil prices have come down this fall—declining to a November average of 51.4 cents per pound from 51.7 cents in October and 55.1 cents in September—prices have been uncompetitive with both South American soybean oil and palm oil from Southeast Asia. USDA trimmed its 2011/12 soybean oil export forecast by 100 million pounds this month to 1.4 billion. As of December 1, U.S. export sales of soybean oil were down 82 percent from a year earlier with the pace of shipments at an 11-year low. Much of the reduction stems from an absence of purchases from China, but buying by more traditional importing countries (such as Mexico) has also been sluggish. Higher output and reduced export demand for soybean oil is seen supporting U.S. season-ending stocks at 2.28 billion pounds, which is 200 million pounds above last month’s forecast.

This month, USDA scaled down its forecast range for the 2011/12-average soybean oil price by 2.5 cents to 50.5-54.5 cents per pound. Later in the marketing year, domestic prices should derive some support from declining production and steadily increasing domestic use.


INTERNATIONAL OUTLOOK
Larger Soybean Crops Seen for India and Canada but China’s Output Declines
Global soybean production for 2011/12 is forecast up slightly this month to 259.2 million metric tons as higher crop estimates for India and Canada offset a reduction for China. With higher inventories expected for the United States and India, global ending soybean stocks are forecast up nearly 1 million tons this month to 64.5 million.

Indian farmers are estimated to have harvested a record 11 million tons of soybeans this year on an all-time high of 10.3 million hectares. This month’s 400,000-ton increase in the crop was based on better-than-average soybean yields, as moisture was ample throughout the growing season.

But market demand lacks strength and most of the additional Indian soybean supply is expected to boost the level of carryout stocks. Soybean demand by Indian crushers could be steady this year because of a more competitive international trade in soybean meal. The processing season has already started slowly, with Indian exports of soybean meal for October-November 2011 down 27 percent from a year earlier. USDA expects Indian meal exports for the entire season to fall 9 percent to 4.2 million tons. However, the impact of weaker exports of soybean meal could be tempered by strong domestic use, as broiler chicken production in India is seen expanding by 10 percent in 2012.

In Canada, this year’s production of soybeans is estimated at 4.25 million tons, improving by 9 percent from last month and slightly below last year’s record of 4.35 million tons. Soybean yields in Canada were below last year’s record but harvested area increased 4 percent from 2010 to an all-time high 1.5 million hectares. Most of the country’s soybean crop is produced in Ontario, where rainfall was well above average this year. Soybean exports from Canada are still expected to dip 2 percent in 2011/12 to 2.9 million tons, although the improved supply provides more support. Soybean crushing may decline by 3 percent this year (to 1.3 million tons), as processors in Canada have market conditions just as dismal as their U.S. counterparts.

China’s soybean harvest for 2011 is estimated 500,000 tons lower this month to 13.5 million. The country’s soybean area did not reach previous expectations as more corn was sown than earlier thought. Based on official sources, farmers in China are estimated to have harvested 7.65 million hectares—600,000 below the previous estimate. Recent crush margins for soybeans in China have not been that good. Domestic demand for soybean meal has moderated and there isn’t much basis this year for an expansion of exports from China. USDA was prompted by this situation to trim its 2011/12 crush forecast for China by 500,000 tons this month to 60.1 million. Soybean imports for China this year are unlikely to be affected by the reduced domestic supply, leaving the forecast unchanged at 56.5 million tons.


Seasonally Strong Competition from Brazil, Slow EU Demand Dampen U.S. Soybean Trade
It is quite unusual this late in the calendar year for soybean export prices from Brazil to be trading at a discount to U.S. Gulf prices, but those are the current circumstances. Due to a record level of old-crop stocks in Brazil, soybean exports are still streaming out of the country. Brazil’s soybean exporters shipped a record 3.2 million tons in October-November 2011. In particular, soybean shipments from Brazil to China expanded by 1.5 million tons from a year ago (a nearly eight-fold increase). By February, the shipments will start a seasonal increase. On account of these factors, USDA raised its 2011/12 forecast of Brazil soybean exports by 500,000 tons this month to 38.5 million.

Outside of China, import demand for soybeans is anticipated to grow more slowly, so there isn’t any good alternative for U.S. exports. EU-27 imports of soybeans and soybean meal have been particularly anemic. The use of soybean meal is being suppressed in Europe by a more abundant and inexpensive supply of feed wheat. Processing margins are also much better for sunflowerseed. In addition, demand for all livestock feeds is being dampened by the current economic upheaval in the EU-27. Forced by a declining value of their government bond holdings, European banks have needed to shore up their capital reserves by tightening lending. Rising borrowing costs are slowing activity there for all types of processing and trading enterprises, including those involved in agricultural products. USDA lowered its 2011/12 forecast of EU soybean imports by 300,000 tons this month to 12.3 million and down from 12.5 million in 2010/11. Likewise, a lower forecast of EU-27 soybean meal consumption drops expected imports for 2011/12 by 400,000 tons to 22.6 million.


Canada’s Record Canola Harvest May Push Domestic Crush and Exports Up to All Time Highs
The 2011 canola harvest in Canada has exceeded previous expectations and is estimated 1.3 million tons higher this month to a record 14.2 million. Planting last spring was delayed by excess soil moisture, but farmers were still able to harvest a record area of 7.5 million hectares. Once sown, most canola fields thrived on the ample moisture, although the crop in Manitoba was generally impaired by the late start. The national crop estimate was raised based on higher estimates of acreage and yields for Saskatchewan and Alberta. Canola yields in Canada were below the record high of 2 years ago, but it was the fourth-consecutive year of above-average yields.

According to the Canadian Oilseed Processors Association, the country’s canola crushers were setting a record pace for August-November 2011 (2.07 million tons). Exports of canola seed are also off to a strong start and are expected to climb to 7.45 million tons versus 7.2 million in 2010/11. The major export markets for Canada are China, Japan, Mexico, and the United States. Despite stronger canola demand in Canada, season-ending stocks are seen 9 percent higher this year to 1.9 million tons.

For China, rapeseed imports for 2011/12 are forecast 300,000 tons higher this month to 1.2 million. These will be encouraged by the country’s smaller domestic crops of rapeseed and soybeans and recent capacity expansion for plants that can crush rapeseed. Since 2009, China has restricted crushing of imported rapeseed to areas of the country that do not grow the crop in order to avoid introduction of a crop disease that is common in Canada.


Indonesian Change of Export Tax Policy Upsets International Palm Oil Trade
This fall, the Government of Indonesia halved its maximum export tax on refined palm oil to 10 percent, while the tax on crude palm oil was reduced only slightly to 22.5 percent. In addition, the maximum export tax on biodiesel was reduced from 10 percent to 7.5 percent. The substantially wider differential in tax rates is designed to promote domestic refining of the oil, including downstream industries such as biodiesel producers. That change could alter the composition of Indonesia’s palm oil exports. In recent years, more than 60 percent of Indonesia’s palm oil exports were in the form of crude oil. Following implementation of the new export tax rates, export prices for Indonesian refined palm oil were reportedly lower than the price for crude oil. Whether Indonesian exporters can sustain a higher volume of trade in refined palm oil will be determined by the expansion rate for refining capacity in the country. Total exports of palm oil from Indonesia are forecast to rise 14 percent in 2011/12 to 18.9 million tons.

Indonesia’s dominance in global palm oil trade makes its revised policy impossible to ignore, but it is controversial in other countries. India’s vegetable oil refiners fear a substantial loss of business from the change in Indonesia’s export tax structure. Even now India has excess refining capacity for vegetable oil, which is reported close to 20 million tons. From Indonesia alone, India is annually importing close to 5 million tons of palm oil, of which crude palm oil accounts for about 80 percent of the total. But India’s import duty on crude palm oil imports is already at zero, so it becomes more difficult politically to widen the tariff differential for refined oil. Any attempt by India to protect its refining industry by making an offsetting tariff increase for refined palm oil (or to decree a higher reference price on which the tariff is applied) would pass all of the higher cost onto its own consumers. In the EU—Indonesia’s second-largest market—palm oil refiners have voiced similar objections to the Indonesian export tax regime.

Malaysian oil processors, who are the main competitors in the export market for refined palm oil, also see Indonesia threatening their market share. Compared to Malaysian prices, export prices for refined palm oil from Indonesia are now discounted by up to $100 per metric ton. This may force Malaysian exporters of refined palm oil to accept considerably smaller processing margins to preserve market share. Only a marginal increase in Malaysian palm oil exports—to 15.9 million tons from 15.8 million in 2010/11—is expected for 2011/12.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 29, 2011, 02:02:44 PM

An Idea: Perennial Grains
28 December 2011



GENERAL - Annual grains feed the world, but they create problems. Perennials are thrifty. Their long roots hold on to soil, water, and fertilizer, which means less pollution, writes Robert Kunzig for the National Geographic.

Humans made an unwitting but fateful choice 10,000 years ago as we started cultivating wild plants: We chose annuals. All the grains that feed billions of people today—wheat, rice, corn, and so on—come from annual plants, which sprout from seeds, produce new seeds, and die every year. "The whole world is mostly perennials," says USDA geneticist Edward Buckler, who studies corn at Cornell University.
 
"So why did we domesticate annuals?" Not because annuals were better, he says, but because Neolithic farmers rapidly made them better—enlarging their seeds, for instance, by replanting the ones from thriving plants, year after year. Perennials didn't benefit from that kind of selective breeding, because they don't need to be replanted. Their natural advantage became a handicap. They became the road not taken.
 
Today an enthusiastic band of scientists have gone back to that fork in the road: They're trying to breed perennial wheat, rice, and other grains. Wes Jackson, co-founder and president of the Land Institute in Salina, Kansas, has promoted the idea for decades. It has never had much money behind it.

But plant breeders in Salina and elsewhere are now crossing modern grains with wild perennial relatives; they're also trying to domesticate the wild plants directly. Either way the goal is crops that would tap the main advantage of perennials—the deep, dense root systems that fuel the plants' rebirth each spring and that make them so resilient and resource efficient—without sacrificing too much of the grain yield that millennia of selection have bred into annuals.
 
We pay a steep price for our reliance on high yields and shallow roots, says soil scientist—and National Geographic emerging explorer—Jerry Glover of the Land Institute. Because annual root crops mostly tap into only the top foot or so of soil, that layer gets depleted, forcing farmers to rely on large amounts of fertilisers to maintain high yields. Often less than half the fertiliser in the Midwest gets taken up by crops; much of it washes into the Gulf of Mexico, where it fertilises algae blooms that cause a vast dead zone around the mouth of the Mississippi. Annuals also promote heavy use of pesticides or tillage because they leave the ground bare much of the year. That allows weeds to invade.
 
Above all, leaving the ground bare after harvest and plowing it in planting season erodes the soil. No-till farming and other conservation practices have reduced the rate of soil loss in the US by more than 40 per cent since the 1980s, but it's still around 1.7 billion tons a year. Worldwide, one estimate put the rate of soil erosion from plowed fields at ten to a hundred times the rate of soil production. "Unless this disease is checked, the human race will wilt like any other crop," Mr Jackson wrote 30 years ago. As growing populations force farmers in poor countries onto steeper, erodible slopes, the "disease" threatens to get worse.
 
Perennial grains would help with all these problems. They would keep the ground covered, reducing erosion and the need for pesticides, and their deep roots would stabilise the soil and make the grains more suitable for marginal lands.

"Perennials capture water and nutrients 10 or 12 feet down in the soil, 11 months of the year," Mr Glover says. The deep roots and ground cover would also hold on to fertiliser—reducing the cost to the farmer as well as to the environment.
 
The perennial wheat-wheatgrass hybrid now growing at the Land Institute can already be made into flour. Yields are too low to compete with annual wheat in Kansas—but maybe not in Nepal, which has steeper slopes and a harsher climate, and where a researcher is now testing perennial hybrids in small plots. Amber waves of perennial grain may be decades away, but the emergence of cheap DNA sequencing is allowing plant breeders to work much faster than they used to.

Mr Buckler thinks that for a tiny fraction of the billions spent annually on corn research, one could create field-testable perennial corn in as little as ten years. "I think we should take a shot at revolutionising agriculture," he says.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 29, 2011, 02:41:35 PM
By RICK CALLAHAN, The Associated Press, Updated: December 28, 2011 4:33 PM
Bugs may be resistant to genetically modified corn

One of the nation's most widely planted crops — a genetically engineered corn plant that makes its own insecticide — may be losing its effectiveness because a major pest appears to be developing resistance more quickly than scientists expected.

The U.S. food supply is not in any immediate danger because the problem remains isolated. But scientists fear potentially risky farming practices could be blunting the hybrid's sophisticated weaponry.

When it was introduced in 2003, so-called Bt corn seemed like the answer to farmers' dreams: It would allow growers to bring in bountiful harvests using fewer chemicals because the corn naturally produces a toxin that poisons western corn rootworms. The hybrid was such a swift success that it and similar varieties now account for 65 percent of all U.S. corn acres — grain that ends up in thousands of everyday foods such as cereal, sweeteners and cooking oil.

But over the last few summers, rootworms have feasted on the roots of Bt corn in parts of four Midwestern states, suggesting that some of the insects are becoming resistant to the crop's pest-fighting powers.

Scientists say the problem could be partly the result of farmers who've planted Bt corn year after year in the same fields.

Most farmers rotate corn with other crops in a practice long used to curb the spread of pests, but some have abandoned rotation because they need extra grain for livestock or because they have grain contracts with ethanol producers. Other farmers have eschewed the practice to cash in on high corn prices, which hit a record in June.

"Right now, quite frankly, it's very profitable to grow corn," said Michael Gray, a University of Illinois crop sciences professor who's tracking Bt corn damage in that state.

A scientist recently sounded an alarm throughout the biotech industry when he published findings concluding that rootworms in a handful of Bt cornfields in Iowa had evolved an ability to survive the corn's formidable defenses.

Similar crop damage has been seen in parts of Illinois, Minnesota and Nebraska, but researchers are still investigating whether rootworms capable of surviving the Bt toxin were the cause.

University of Minnesota entomologist Kenneth Ostlie said the severity of rootworm damage to Bt fields in Minnesota has eased since the problem surfaced in 2009. Yet reports of damage have become more widespread, and he fears resistance could be spreading undetected because the damage rootworms inflict often isn't apparent.

Without strong winds, wet soil or both, plants can be damaged at the roots but remain upright, concealing the problem. He said the damage he observed in Minnesota came to light only because storms in 2009 toppled corn plants with damaged roots.

"The analogy I often use with growers is that we're looking at an iceberg and all we see is the tip of the problem," Ostlie said. "And it's a little bit like looking at an iceberg through fog because the only time we know we have a problem is when we get the right weather conditions."

Seed maker Monsanto Co. created the Bt strain by splicing a gene from a common soil organism called Bacillus thuringiensis into the plant. The natural insecticide it makes is considered harmless to people and livestock.

Scientists always expected rootworms to develop some resistance to the toxin produced by that gene. But the worrisome signs of possible resistance have emerged sooner than many expected.

The Environmental Protection Agency recently chided Monsanto, declaring in a Nov. 22 report that it wasn't doing enough to monitor suspected resistance among rootworm populations. The report urged a tougher approach, including expanding monitoring efforts to a total of seven states, including Colorado, South Dakota and Wisconsin. The agency also wanted to ensure farmers in areas of concern begin using insecticides and other methods to combat possible resistance.

Monsanto insists there's no conclusive proof that rootworms have become immune to the crop, but the company said it regards the situation seriously and has been taking steps that are "directly in line" with federal recommendations.

Some scientists fear it could already be too late to prevent the rise of resistance, in large part because of the way some farmers have been planting the crop.

They point to two factors: farmers who have abandoned crop rotation and others have neglected to plant non-Bt corn within Bt fields or in surrounding fields as a way to create a "refuge" for non-resistant rootworms in the hope they will mate with resistant rootworms and dilute their genes.

Experts worry that the actions of a few farmers could jeopardize an innovation that has significantly reduced pesticide use and saved growers billions of dollars in lost yields and chemical-control costs.

"This is a public good that should be protected for future generations and not squandered too quickly," said Gregory Jaffe, biotechnology director at the Center for Science and Public Policy.

Iowa State University entomologist Aaron Gassmann published research in July concluding that resistance had arisen among rootworms he collected in four Iowa fields. Those fields had been planted for three to six straight years with Bt corn — a practice that ensured any resistant rootworms could lay their eggs in an area that would offer plenty of food for the next generation.

For now, the rootworm resistance in Iowa appears isolated, but Gassmann said that could change if farmers don't quickly take action. For one, the rootworm larvae grow into adult beetles that can fly, meaning resistant beetles could easily spread to new areas.

"I think this provides an important early warning," Gassmann said.

Besides rotating crops, farmers can also fight resistance by switching between Bt corn varieties, which produce different toxins, or planting newer varieties with multiple toxins. They can also treat damaged fields with insecticides to kill any resistant rootworms — or employ a combination of all those approaches.

The EPA requires growers to devote 20 percent of their fields to non-Bt corn. After the crop was released in 2003, nine out of 10 farmers met that standard. Now it's only seven or eight, Jaffe said.

Seed companies are supposed to cut off farmers with a record of violating the planting rules, which are specified in seed-purchasing contracts. To improve compliance, companies are now introducing blends that have ordinary seed premixed with Bt seed.

Brian Schaumburg, who farms 1,400 acres near the north-central Illinois town of Chenoa, plants as much Bt corn as he can every spring.

But Schaumburg said he shifts his planting strategies every year — varying which Bt corn hybrids he plants and using pesticides when needed — to reduce the chances rootworm resistance might emerge in his fields.

Schaumburg said he always plants the required refuge fields and believes very few farmers defy the rule. Those who do put the valuable crop at risk, he said.

"If we don't do it right, we could lose these good tools," Schaumberg said.

If rootworms do become resistant to Bt corn, it "could become the most economically damaging example of insect resistance to a genetically modified crop in the U.S.," said Bruce Tabashnik, an entomologist at the University of Arizona. "It's a pest of great economic significance — a billion-dollar pest."
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on December 30, 2011, 11:02:15 AM
Thursday, December 29, 2011
End of Ethanol Tax Credits Affects Feed Market
ANALYSIS - The US ethanol tax credit, which is worth roughly $6 billion, is due to end at the turn of the year, writes Editor in Chief, Chris Harris.

Many in the US ethanol industry believe they have built such secure foundations that its removal on 31 December will not have serious repercussions.

Ethanol manufacturers are focusing on promoting higher blends of ethanol into petrol and installing blender pumps to dispense higher blends and larger production of flex-fuel vehicles.

Bob Dinneen of the trade group the Renewable Fuels Association said that he expects a continued growth in the industry.

However, with now around half the corn grown in the US going to first generation biofuels, the removal of the assistance to ethanol producers could have far reaching repercussions. Ethanol takes a larger share of the US corn crop than cattle, pigs and poultry put together.

This growth in the use of corn for ethanol rather than livestock feed fueld the fule vs feed debate and drew howls of anguish from food manufacturers, livestock producers and environmentalists.

The change at the end of the year that was signalled during the summer will see a tariff of 54 cents a gallon on ethanol imports expire along with the excise tax credit of 45 cents a gallon.

The Brazilian Cane Sugar Association (UNICA) believes the removal of the tariff will open up the US market and spur long-term growth for Brazilian ethanol.

However, at the moment while Brazil exports premium ethanol to California, it imports more than it exports and the bulk of the imports come from the US in the form of corn based ethanol.

Up to October this year, Brazil shipped 39 million gallons of ethanol to the U.S. market. In the same period, 156.3 million gallons of US ethanol went to Brazil.

The US is the world's foremost manufacturer of ethanol with an output of 13.8 billion gallons forecast for this year.

Brazil is number two with 6 billion gallons.

For some US manufacturers, the removal of the tax breaks, which came into force in 1979, are being viewed as a major blow.

The industry has written to Congress calling for an extension of the Cellulosic Biofuels Producer Tax Credit and the Special Depreciation Allowance for Cellulosic Biofuel Plant Property.

The Advanced Ethanol Council said the credits are vital to the development of the domestic advanced ethanol industry.

"To ensure stability in the marketplace and prevent unnecessary job losses, Congress should provide long-term extensions of these provisions (5+ years)," the AEC wrote.

The AEC has called for a comprehensive approach to the reform of energy tax, but it added that in the meantime it was necessary to extend the tax incentives.

Another effect that the removal of the tax credits for corn produced ethanol is likely to have is on the price of corn for animal feed.

When the subsidies are removed, will the price of corn for ethanol production be forced down as the ethanol manufacturers strive to reduce production costs?

Will the farmers, who have been receiving good money from the ethanol producers for their corn, accept a dip in prices?

In the long run, if the removal of the subsidies has the effect of reducing corn prices, this also will be good news to livestock farmers, who could expect to see feed corn prices also come down.

Another scenario is that the price of ethanol will rise to consumers to balance out the loss of the subsidies. If this is the case, the balance between fossil fuel prices and biofuel prices will be upset, making fossil fuels more attractive.

All in all the New Year offers an interesting time on the corn markets in the US, which in turn will be reflected in corn markets and prices around the world.


Chris Harris, Editor-in-Chief
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 10, 2012, 04:43:09 AM
Monday, January 09, 2012
CME: Relationships that May Impact Corn Prices
US - Writing in a recent Markets column for FarmweekNow.com, friend and noted analyst Dale Durchholz of AgriVisor pointed out some very interesting price relationships that may be impact corn prices in coming months, write Steve Meyer and Len Steiner


The dominant force in the corn (and thus all grain and soybean) markets the past few weeks has been growing weather challenges in Argentina.

Hot, dry conditions in the primary corn growing country in the southern hemisphere have driven corn futures anywhere from 60 to 80 cents per bushel higher, depending on which contract you look at, since 15 December.

News reports and forecasts this week indicate that conditions may be improving but the rally has moved corn futures prices well away for that December trough — at least for the time being.

Mr Durchholz contends, though, that there are significant factors that will pressure corn prices as we go into the spring and summer and offers the ratios of corn price to wheat and soybean prices as prime evidence. The charts of those two ratios, using weekly data in order to include a longer historical period, appear at right and the sources of Dale’s argument are clear: Both ratios are very near alltime highs.

We find the situation worthy of attention because these two ratios measure corn relative to two major competitive situations.

The first is value-in-use as livestock feed. Expensive corn will encourage wheat feeding, pushing wheat prices higher and lowering this ratio. It will also ration corn supplies and push corn prices lower in the future.

The second competitive situation is the Corn:Soybean ratio’s implications for the value-in-use of land. It is clear that corn is going to compete VERY well on a price basis with soybeans and every estimate we have seen of projected returns above cash costs for US farmers suggest that this price ratio strength will translate into a peracre profitability advantage. The result will be more corn acres, more corn (assuming weather is good) and lower corn prices re. soybeans.

But we also read Dale’s column and said “Yes, but what about OIL?” The advent of corn-based ethanol has added a new value-in-use proposition to the corn market in recent years and has tied corn prices to the prices of oil and gasoline. The bottom chart shows that this measure of relative corn value is not quite as negative for corn prices as are the others.

The 12/31 price ratio of .065 is very close to the middle of the Corn:Crude Oil ratios observed since mid- 2006. It does not suggest price pressure in any direction for corn at this time and would, in our mind, be more supportive to corn prices than would either of the other two ratios. The ration does, though, allow plenty of room for corn prices to fall without creating an unusual relationship with crude oil. Not supportive of corn but not definitive.

We think two issues are vitally important. First, are there any compelling reasons to think that the relative values of the crops in question have changed more-or-less permanently? Second, which price in each ratio is more likely to move and thus change the relationship? It certainly may be, as Durchholz states, corn but the U.S. accounts for a smaller world share of both wheat and soybean output than it does corn. Growers in other countries will hold much more influence on those prices.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 11, 2012, 03:39:32 AM
Tuesday, January 10, 2012
USDA: Focus on South American Weather
US - Corn and soybean prices declined sharply in mid-November and remained at the lower level through mid-December. From mid-December through early January, the cash price of corn in central Illinois increased by $0.78 while the cash price of soybeans increased by $1.21 per bushel.


One of the factors that has contributed to higher prices is adverse weather in parts of Argentina and southern Brazil during a critical phase of crop development. Periods of extremely high temperatures and well below average levels of precipitation in December have threatened both the corn and soybean crops in those areas.

The adverse weather followed very favorable weather conditions in November. The weather pattern in those areas has been similar to that of 2008-09 when corn and soybean production was substantially reduced in Argentina. Some beneficial rainfall in the dry areas is expected this week, but the forecast calls for a return of hot, dry weather next week. It is difficult to assess potential corn and soybean production in Argentina and Brazil, but the pattern of production estimates in 2008-09 might provide some guidance.

In early December 2008, the USDA judged 2009 corn production potential in Argentina at 710 million bushels. The final production estimate was nearly 17 per cent smaller at about 590 million bushels. The 2009 Brazilian corn crop was forecast at 2.1 billion bushels in December 2008, but actual production was nearly 5 per cent less at two billion bushels.

In early December 2011, the USDA forecast the 2012 Argentine corn crop at about 1.14 billion bushel. If production is eventually reduced by 17 per cent, as it was in 2009, the crop would come in at about 950 million bushels. Similarly, the USDA has projected the 2012 Brazilian corn crop at about 2.4 billion bushels. If production is reduced by five per cent, the crop would total about 2.3 billion bushels.

A 2012 South American corn crop that is 290 million bushels smaller than the current forecast would likely lead to larger US corn exports in both the 2011-12 and 2012-13 marketing years. In December 2008, the USDA projected 2008-09 marketing year US corn exports at 1.8 billion bushels. Exports were 49 million bushels larger than the forecast, equal to about 22 per cent of the reduction in the size of the South American crop from the December 2008 forecast.

This year, USDA projects US corn exports at 1.6 billion bushels. A 290 million bushel reduction in the size of the South American crop could boost US exports by as much as 65 million bushels. The increase, however, might be smaller due to the abundance of feed grains and wheat in the rest of the world.

For soybeans, The USDA projected the 2009 Argentine crop at 1.855 billion bushels in December 2008. Production totaled only 1.175 billion bushels, nearly 37 less than the December projection. The size of the Brazilian crop was forecast at 2.168 billion bushels in December 2008, but came in about two per cent smaller at 2.124 billion bushels.

In December 2011, the USDA projected the 2012 Argentine soybean crop at 1.95 billion bushels and the Brazilian crop at 2.755 billion bushels. Reductions similar to those of 2009 would result in crops of 1.23 billion bushels and 2.7 billion bushels, respectively. Production would be 775 million bushels below the current projection.

In 2008-09, US soybean exports totaled 1.279 billion bushels, 229 million larger than the USDA’s December 2008 projection. The increase equaled 31 per cent of the reduction in the size of the South American crop. For the current marketing year, the USDA projects US soybean exports at 1.325 billion bushels.

Exports would be 240 million bushels larger if they increased by 31per cent of the potential shortfall in South American production. Exports will not be that large since the expected shortfall in South American production is less than 775 million bushels and particularly since US supplies are not large enough to support exports at that level.

The USDA will update the projections of South American corn and soybean production on 12 January. The final estimates of the size of the 2011 US corn and soybean crops and the estimate of 1 December, 2011 stocks of those two crops will also be released on 12 January.

The estimate of corn stocks will be especially important as it will reflect any changes in the production estimate and the rate of feed and residual use during the first quarter of the marketing year. The trade is expecting a smaller production estimate and a relatively small inventory number.

The level of corn and soybean prices over the next seven weeks will be extremely important. The average price of December 2012 corn futures and November 2012 soybean futures during February will establish the price guarantee for crop revenue insurance products. It now looks as though those prices will be well supported.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 11, 2012, 03:40:38 AM
Tuesday, January 10, 2012
CME: 2011 USDA Corn Yield Estimates Down Again
US - USDA will kick off the new year of “highly anticipated” crop production data Thursday with its monthly Crop Production and World Agricultural Supply and Demand Estimates (WASDE), quarterly Grain Stocks and annual Winter Wheat Seedings reports, write Steve Meyer and Len Steiner.


The results of Reuters’ pre-report survey of market analysts regarding their estimates of the USDA numbers appear below. These survey results are offered to provide a sense of the information that is “in the market” prior to the report. The average’s shown here provide some idea of what “the market” is expecting to see. Actual report numbers that differ substantially from these averages usually result in futures contract price changes.

As expected, analysts’ expectations for USDA estimates of 2011 corn and soybean yield and production are basically “fine tuning” of previous estimates. They expect, on average, the corn yield to be lowered again,this time to 146.2, down 0.5 bushels from December and 4.4 per cent lower than the 2010 yield.

The yield decline is expected to shave 45 mil. bu. off USDA’s 2011 corn crop estimate. At 12.265 bil. bu., the 2011 crop would be 1.5 per cent lower than one year earlier but would still rank as the fourth largest US corn crop on record.

USDA’s 2011 soybean yield estiamtes is expected to be raised slightly to 41.4 bushels per acre, up 0.1 bushels from last year. That yield would be 4.9 per cent smaller than last year. The 2011 bean crop is, quite logically, also expected to be slightly from last month’s estimate to 3.048 billion bushels. At that level, the 2011 crop would rank as the sixth largest in history.

Analysts expect 1 December, 2011 US corn and wheat stocks to be sharply lower than one year ago. That number certainly makes sense for wheat due to significantly lower hard red winter wheat output last year and higher feeding levels for soft red wheat last summer. Total wheat stocks are expected to be 1.695 billion bushels on 1 December, 2011, 12.3 per cent lower than last year.

Corn stocks at an expected 9.391 billion bushels would be 6.7 per cent below last year levels. The 2011-12 crop year started off with 580 million fewer bushels in inventory, added 137 million fewer bushels of production (according to USDA’s December estimates) than was added by the 2010 crop and there are now 666 million bushels less in inventory as of 1 December.

Do the math and those figures say that total corn usage in the Sep 1—Dec 1 quarter was 4.047 billion bushels compared to 4.121 billion bushels one year ago. Slower exports were more than offset by higher ethanol usage (due to an apparent race to capture blenders tax credits before they expired on December 31).

We do not believe that feed usage was much lower in the quarter relative to last year due to higher numbers of hogs and cattle on feed offsetting lower chicken numbers.

Winter wheat seedings show total acres slightly higher (by 0.7 per cent) than one year ago but some shifts among the types of wheat.

Hard red seedings, which account for over 70 per cent of the total) are expected to be nearly 1 million acres higher than last year while soft red seeding are expected to fall by nearly 800,000 acres. Moisture conditions in the wheat belt have improved considerably but continued improvement in conditions in Oklahoma, Texas and Kansa will be key for the hard red wheat crop next summer.

With all that said, the numbers that will get the most attention will be USDA’s estimates of South Americanc orn and soybean crops. Informa Economics on Friday cut its estimate of Argentina’s corn crop by three million MT (11 per cent) to 24 mil. MT.

It also lowered its estimate for Brazilian corn to 61 mil. MT, down 2 mil. MT. or 3.2 per cent from prior estimates. Informa lowered its estimates of both countries’ soybean harvests by two mil. MT — to 51 mil. MT for Argentina and 72 mil. MT for Brazil.


Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 14, 2012, 03:47:39 AM

Friday, January 13, 2012

CME: Corn Plunges on Inventory Report

US - March, May and July corn futures plunged limit-down (-40¢) yesterday after USDA announced higher-than-expected inventories in its quarterly “Grain Stocks” report, writes Alan Levitt.
 

World carryout corn stocks for 2011/12 are projected to reach 128.1 million tons, up one million tons from the December estimate. MAR corn settled at $6.11/bushel, erasing the gains of the previous three weeks.

In Dairy Market News’ weekly survey, dry whey prices at the midpoint of the range topped 70¢ this week for the first time since July 2007.

In the Midwest, dry whey is mostly 69.5¢- 72¢, while in the West it’s mostly 69¢-72.25¢, DMN says.

“First quarter contracts reflect tighter supplies for the new year,” the report adds. “The whey stream supply is increasingly diverted to higher protein concentrates and therefore less is available for dry whey production.”

However, the European whey market has been steady for two months, even as US prices have tacked on 7-9¢ over that time. DMN pegs European dry whey at 58-64¢, leaving the premium of US prices over European prices at the widest ever.

In Europe, “whey volumes are starting to build as buyers have been absent from the marketplace during the year-end holidays and, for some, prices of European offerings are higher than they are willing to pay,” DMN explains. Whey futures were mixed yesterday, with Q1 contracts averaging 70.0¢ and Q2 averaging 64.9¢.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 18, 2012, 03:57:01 AM

Argentinian Barley Harvest Greatest in Ten Years
16 January 2012

ARGENTINA - The Grain Exchange of Buenos Aires last week reported that the harvest of malting barley, with a backlog of 3.65 million tonnes, was higher than the previous cycle of 2.50 million, and most importantly of the last 10 years, reports lanacion.com.

"The cultivated area recorded an increase of 49 per cent over the 2010/2011 season, going from 650,000 to 970,000 hectares. One of the main reasons for this increase was the producer's intention to seek a substitute for wheat crops. In addition to the agronomic benefits that this crop offers, the possibility of early harvest makes way for planting soybeans afterwards," said the Grain Exchange.
 
The harvest ended with an average yield of 41 quintals per hectare.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 18, 2012, 03:58:10 AM
KAZAKHSTAN - The USDA estimates Kazakhstan 2011/12 wheat production at 22.5 million tons, up 1.5 million or 7 per cent from last month, and up 12.8 million or 132 per cent from last year.

The harvest surpassed the previous record of 22.2 million tons, set in 1979 when sown area was nearly 25 per cent higher. Area for 2011/12 is estimated at 13.8 million hectares against 14.5 million last year. Yield is estimated at a record 1.63 tons per hectare (t/ha) compared to 1.52 t/ha last month, 0.67 t/ha last year, and the 5-year average of 1.02 t/ha.
 
The month-to-month revision is based on preliminary data from the State Statistical Agency. The main wheat-production region benefited from outstanding weather throughout the growing season. Wheat typically comprises about 80 to 85 per cent of Kazakhstan’s total grain production.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 18, 2012, 03:59:38 AM

CME: Corn Futures Closed Lower Thursday
13 January 2012

US - March Corn finished down 40 at 611 1/2, 48 off the high and equal to the low. May Corn closed down 40 at 618 1/4. This was equal to the low and 48 off the high.

March corn traded for just a few minutes this morning before locking down the 40 cent limit. The market stayed limit down for the first two hours of trade and then saw a 2 1/2 cent trading range near the mid-session. The USDA data was very negative for grain stocks and production data and this helped spark aggressive selling from speculators and producers early in the day.
 
Traders had been looking for bullish news so buyers have been active over the past week or more and the market lacked new buying interest on the early break. Traders noted that synthetic options traded down 3 1/2 cents more than the limit shortly after the opening. The USDA pegged ending stocks for the 2011/12 season at 846 million bushels which was down just two million from last month and well above trade expectations for a 100 million bushel decline.
 
Final production was pegged at 12.358 billion bushels, up 48 million bushels from their previous forecast while traders were expecting a drop of near 45 million bushels. Yield was 147.2 vs. 146.7 previous. Exports were revised higher by 50 million bushels. World ending stocks were pegged at 128.14 million tonnes from 127.19 million last month and trade expectations near 123.5 million tonnes. Argentina production was revised down by 3 million tonnes to 26 million and Brazil was left unchanged. December 1st corn stocks were pegged at 9.642 billion bushels which was up 250 million from trade expectations.
 
Weekly export sales for corn, came in at 321,500 metric tonnes for the current marketing year and cancellations of 23,000 for the next marketing year for a total of 298,500 tonnes which was well below trade expectations. Cumulative corn sales stand at 59.6 per cent of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 53.9 per cent. Sales of 493,000 metric tonnes are needed each week to reach the USDA forecast. March Rice finished down 0.23 at 14.57, 0.14 off the high and 0.12 up from the low.
 
Wheat Futures Closed Lower
 
March Wheat finished down 36 at 605, 43 3/4 off the high and 13 up from the low. July Wheat closed down 30 at 648. This was 15 3/4 up from the low and 37 off the high. March wheat closed sharply lower on the session as both wheat and corn data from the USDA was bearish enough to spark aggressive selling. The wheat data was bearish as US usage came in below trade expectations and wheat plantings for the 2012 crop came in well above trade expectations.
 
The USDA pegged total winter wheat planted acreage for 2012 at 41.947 million acres as compared with trade expectations for near 40.933 million. Hard red winter wheat acreage was up 662 million above trade expectations to over 30 million and soft red was up nearly 600 million above expectations at 8.37 million.
 
Ending stocks for the 2011/12 season were pegged at 870 million bushels as compared with trade expectations near 842 million. While exports were revised higher (as expected) feed usage was revised lower by 15 million bushels to 145 million which was bearish as traders expected a boost in wheat feeding. Wheat stocks as of December 1st were pegged at 1.656 billion bushels as compared with trade expectations at 1.695 billion. For the world report, 2011/12 ending stocks were pegged at 210.02 million tonnes, up more than 2 million from trade expectations.
 
Weekly export sales for wheat came in at 365,200 metric tonnes for the current marketing year and 73,000 for the next marketing year for a total of 438,200. Cumulative wheat sales stand at 77.2 per cent of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 75.2 per cent. Sales of 279,000 metric tonnes are needed each week to reach the USDA forecast. On top of the weekly sales, Algeria bought 300,000 tonnes of optional origin milling wheat.
 
Traders believe the origin is likely France or Argentina. The EU granted export licenses this week for 168,000 tonnes which pushed cumulative exports since the start of the 2011/12 season to 7.5 million tonnes as compared with 11.9 million last year at this time. March wheat is now down as much as 78 3/4 cents or 11.7 per cent from the 2012 peak. March Oats closed down 14 1/4 at 284 1/4. This was 5 3/4 up from the low and 16 1/2 off the high.
 
Soybean Futures Closed Lower
 
March Soybeans finished down 20 1/2 at 1182 1/2, 31 off the high and 32 1/2 up from the low. May Soybeans closed down 20 at 1192 1/2. This was 32 1/2 up from the low and 31 off the high. March Soymeal closed down 5.7 at 307.1. This was 10.7 up from the low and 8.2 off the high. March Soybean Oil finished down 0.43 at 51.46, 0.82 off the high and 1.18 up from the low. March soybeans were down 53 cents early in the session but managed to rally 32 1/2 cents off of the early lows into the mid-session.
 
The USDA data was mostly bearish across the board but especially for the corn market and a limit-down move in corn to start the day helped to drive soybeans sharply lower. The USDA pegged US soybean production at 3.056 billion bushels from 3.046 billion last month which was about as expected. Ending stocks, however, were pegged at 275 million bushels as compared with trade expectations looking for near 233 million. Exports were revised lower by 25 million and crush down by 10 million.
 
Without a serious drop in South America production, the USDA was in a position to drop usage and the increase in production and lower usage fell directly to the bottom line. World ending stocks for the 2011/12 season came in at 63.43 million tonnes as compared with 64.54 million last month. December 1st soybean stocks came in at 2.366 billion bushels, up 42 million from trade expectations. Weekly export sales for soybeans came in at 433,900 metric tonnes for the current marketing year and 300 for the next marketing year for a total of 434,200. Sales of 296,000 metric tonnes are needed each week to reach the USDA forecast.
 
Net meal sales came in at 47,600 tonnes which was below trade expectations and compares with sales of 99,000 tonnes needed each week to reach the USDA forecast. Net oil sales came in at just 1,100 metric tonnes which was also lower than expected. As of January 5th, cumulative soybean oil sales stand at 31.7 per cent of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 42.0 per cent. Sales of 10,000 metric tonnes are needed each week to reach the USDA forecast.
 
On top of the weekly sales, private exporters reported to the USDA export sales of 414,000 tonnes of US soybeans to unknown destination. The USDA news was negative but traders believe that the market would not be down as much as it was except for the outlook for improving weather in South America in another 8-9 days after heavy rains in the past few days. In addition, the limit-down move in corn has added to the negative tone. Traders will be closely monitoring weather forecasts in South America for direction Friday and early next week.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 18, 2012, 04:01:32 AM

Drought in Southern Brazil Reduces 2011/12 Soybean Production Forecast
13 January 2012

BRAZIL - Brazil’s 2011/12 soybean production is forecast at 74 million tons, down 1.0 million from last month and down 1.5 million or 2 per cent from last year.

Yield is forecast at 2.96 tons per hectare, down 1 per cent from last month due to below-average rainfall in the south during November and December. Area is forecast at a record 25 million hectares, unchanged from last month and up 0.8 million or 3 per cent from last year. The planting pace was ahead of the 5-year average throughout the planting season, with most of the crop planted by the end of December.
 
Above-average rainfall during October gave nearly ideal planting conditions for most of Brazil. However, below-average rainfall in the south during December reduced potential yields, especially in regions that were planted early where crop stage was in the critical flowering and pod-filling stages during December’s drought.
 
Harvesting started this month in Parana, the second-largest soybean producing state, which reported below-average yields in the early-planted regions located in the western and southwestern portions of the state. DERAL, the state crop estimating agency for Parana, also reduced their soybean production forecast this month by 1.4 million tons (from 14.1 to 12.7 MT) due to December’s drought and low reported harvested yields in western Parana. In contrast, seasonal rainfall was beneficial in central and northeastern parts of Brazil. Mato Grosso, the largest soybean producing state in the central west, is expecting a record soybean harvest of 22.2 million tons and above last year’s record crop of 20.4 million tons.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 19, 2012, 02:46:58 AM
Wednesday, January 18, 2012
Corn Stocks Report Throws Another Curve Ball
US - In this week's "Market Preview" featured in National Hog Farmer magazine, Steve Meyer discusses the latest WASDE and "Grain Stocks" report released by the US Department of Agriculture (USDA).


Sometimes, it is best to not ask "why" a situation looks a bit screwy, but rather to simply take advantage of it and move on. Such may be the case with the USDA’s World Agricultural Supply & Demand Estimates (WASDE) and Grain Stocks reports released last week.

Figure 1 shows the latest domestic production, supply and demand data for corn from USDA. The numbers were somewhat bearish in that they indeed suggest higher output and, thus, larger supplies for the current crop year. The new yield estimate of 147.2/acre is 0.5 bushels larger than the December estimate and a whole bushel higher than the average of analysts’ pre-report expectations. However, in the big picture, the impact on the estimated crop is pretty marginal as the additional 48 million bushels is completely removed by a 50-million bushel increase in projected exports. The net impact is a reduction in year-end projected stocks of only 2 million bushels, leaving the projected year-end stocks-to-use ratio at 6.7 per cent. None of those are enough to change markets much, even though USDA did shave 20 cents/bushel off of both ends of its forecast range for the average US farm price.


The surprise, and thus the primary source of Thursday and Friday’s price declines, was USDA’s estimate that 9.641 billion bushels of corn remained in storage in the United States on 1 December. As Figure 2 shows, that was 250 million bushels (2.7 per cent) higher than the average of analysts’ pre-report estimates and nearly beyond the top of the analysts’ range (9.7 billion bushels). That extra corn is available to the market, thus easing availability concerns and causing prices to fall.


The problem is that the USDA stocks numbers don’t make a lot of sense. And that’s not a new problem since the Grain Stocks reports have been throwing curve balls for the past two years. Those 1 December stocks imply that feed/residual usage for corn was over 10 per cent smaller for the September-November quarter than it was one year ago in spite of the fact that hog numbers were 1.3 per cent higher than last year on 1 December and the number of cattle on feed on 1 December was 4 per cent higher than last year. Yes, chicken numbers were down, but how many chickens can you feed with the corn that normally goes to a steer? The answer – a lot! It is also true that ethanol production and, thus, distiller’s dried grains with solubles (DDGS) production were higher and that wheat was favorably priced in some areas relative to corn. But 10 per cent lower feed usage still strikes me as very low relative to animal numbers.

In addition, USDA did not lower its estimate of feed/residual use for the year. It still stands at 4.6 billion bushels, 4 per cent lower than last year. If the first quarter is down 10 per cent, wouldn’t that reduce usage for the year? If not, just what is going to eat enough over the next three quarters for the number to catch up, even to down 4 per cent?

Any shortfall of corn feeding cannot be made up with DDGS this crop year since USDA is predicting less corn (5.0 vs. 5.2 billion bushels) will be used for ethanol production this year. One caveat is that domestic DDGS availability could rise if exports are reduced and lower corn prices and a stronger US dollar will make that happen to some degree. But I doubt it will be anywhere near enough to fill the whole implied by a 10 per cent reduction in the first quarter of the crop.

Maybe the best explanation was winter wheat seedings of 41.947 million acres, which exceeded the average pre-report estimate by over 1 million acres. That is a big, relatively unexpected increase especially given the weather conditions that the southern hard red winter wheat belt has suffered the past year. That is where the increase occurred, with Texas at +600,000 acres, Oklahoma at +400,000 and Kansas at +700,000 compared to last year. These increases support our recent admonishment that hog producers need to keep an eye on wheat prices and what they might imply for economical hog diets – if not for producers in the Corn Belt, then for producers nearer the major wheat-producing areas.

The good news from all of this is, of course, lower projected costs for the coming year. Figure 3 shows the costs and hog prices projected by closing lean hogs, corn and soybean meal futures prices last Friday. That $12.62/head profit figure is sharply higher than just one week earlier and is due, primarily, to a decline in projected costs. My average for 2012 is now "just" $82.14/cwt., carcass, over $4 lower than the average for 2011.


Will you be able to do better? Perhaps, if everything goes well with winter wheat development and corn planting season. Old crop corn, though, is back near the bottom of both its historic trading range and the $6 to $7 range that I have expected.

 



As published in National Hog Farmer's Weekly Preview.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 25, 2012, 03:20:41 AM
Tuesday, January 24, 2012
Corn Price Swings to Continue?
US - Since early October, corn prices have bounced in a wide trading range. March 2012 futures have traded between about $5.75 and $6.75 while December 2012 futures have been between about $5.35 and $6.20, writes Darrel Good, agricultural economist at University of Illinois.


The wide price fluctuations have reflected numerous changes in indications of underlying supply and demand for corn. Those changing factors included USDA production and stocks reports, South American weather, the rate of exports and export sales, the rate of ethanol production, and expectations about the potential size of the 2012 U.S. crop. Prices have also likely been influenced by the volatility in the financial, currency, and metals markets. Currently, March 2012 futures are near the middle of the four-month trading range, while December 2012 futures are in the low end of the recent range.

Prices for the 2011 crop are currently being supported by a fairly rapid rate of consumption and on-going uncertainty about the size of the upcoming South American harvest. Basis levels have been generally strong since harvest and are currently at record levels for this time of year in some markets. While 1 December 2011 stocks of US corn were larger than expected, they were at a 5-year low. Year-ending stocks are projected to be a relatively small 6.7 percent of consumption. Ethanol production in the first two weeks of January was nearly 5 percent larger than during the same two weeks last year. The low price of ethanol relative to gasoline suggests that blending economics will remain favorable even without the blenders’ tax credit. Ethanol export prospects also remain favorable due to reduced competition from Brazilian ethanol. With 7 months remaining in the marketing year, there is potential for price relationships to change, but it appears that corn use for production of ethanol and co-products is well on the way to reaching the USDA projection of 5 billion bushels for the year.

Earlier in the month, the USDA increased the projection of marketing year US corn exports by 50 million bushels, to a total of 1.65 billion bushels. The increase was partially in response to reduced production and export forecasts for Argentina. Recent weather in Argentina has been less stressful than in December and early January, but total precipitation since November has been well below average in most areas and less than in 2008-09 in some areas. Further reductions in the forecast size of that crop would not be surprising. The pace of exports and export sales of US corn also supported the larger projection of marketing year exports. As of 12 January, 62 percent of the projected marketing year exports had been sold, slightly ahead of the pace of a year ago. China has been a steady buyer of US corn since September, with commitments totaling 136 million bushels as of 12 January. New sales to China averaged 6 million bushels per week for the past 19 weeks. There were only two weeks when no new sales to China were recorded. Even with implied feed and residual use of corn at a very low level, year-ending stocks of U.S. corn could be slightly smaller than the current projection of 846 million bushels.

March 2013 futures are about $.50 lower than March 2012 futures and the spread widened about $.20 over the last week. The market is anticipating a larger US corn crop in 2012 and some build-up of inventories by the end of the 2012-13 marketing year. The larger crop expectation stems from expectations for an increase in acreage, motivated by high prices, and higher yields after two consecutive years of below trend yields. Current expectations for planted acreage of corn appear to center on about 94 million, two million more than planted in 2011. With favorable planting season weather, such an increase could be easily accommodated without a reduction in total acreage of other spring planted crops. Total cropland acreage could increase substantially in 2012 as a result of maturing CRP contracts in September 2011 and a sharp reduction in prevented plantings from those of 2011.

Planted acreage of 94 million would point to acreage harvested for grain near 87 million, 3 million more than harvested in 2011. An average yield near 160 bushels, then, would result in a crop of 13.92 billion bushels. Corn consumption would have to increase by 1.28 billion bushels (10 percent) next year to prevent an increase in the size of year-ending stocks. Unless expectations for a larger crop are altered by spring weather or by acreage estimates, prices for the 2012 crop will remain below the prices for the 2011 crop. Prices for the 2011 crop are expected to remain within the range established over the past four months, at least for a few more weeks.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 26, 2012, 01:22:49 PM

Barley Adapts to Climate Change
25 January 2012



SPAIN - The upsurge in droughts is one of the main consequences of climate change, and affects crops in particular. However, Anabel Robredo, a biologist at the University of the Basque Country (UPV/EHU), has confirmed that in the case of barley at least, climate change itself is providing it with self-defence mechanisms to tackle a lack of water.

Climate change is in fact also responsible for a considerable increase in the concentration of CO2, a gas that, paradoxically, is providing this plant with certain characteristics enabling it to offset the effects of drought.
 
Her thesis is entitled Mecanismos fisiológicos de respuesta de la cebada al impacto de la sequia y el elevado CO2: adaptación al cambio climático (Physiological Response Mechanisms of Barley to the impact of drought and elevated CO2: adaptation to climate change). Various international publications have also echoed this research, the most recent being Environmental and Experimental Botany.
 
Ms Robredo has analysed the effect that takes place in the barley as a result of the combination of two of the main consequences brought to us by climate change: the enriching of CO2 and drought. As the researcher explains, “the atmospheric concentration of this gas has increased considerably within the last few decades, and it is expected to increase much more. So we compared barley plants that grow in a CO2 concentration equal to the current (ambient) one with others cultivated in double the concentration, which is what we are expected to reach by the end of this century."

The study was carried out through a progressive imposition of drought so it also determined the capacity of these plants to recover following the lack of irrigation, in an ambient CO2 concentration as well as in the one expected for the future.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 26, 2012, 01:25:04 PM

CME: Corn Futures Closed Higher Tuesday
25 January 2012


US - March Corn finished up 10 1/4 at 630 1/4, 5 3/4 off the high and 15 3/4 up from the low. May Corn closed up 9 1/2 at 635 1/4. This was 14 3/4 up from the low and 5 1/4 off the high.

March corn closed sharply higher on the session and has now rallied as much as 43 1/2 cents from last week's lows. Rumors that Russia would tax exports supported wheat and rumors that Argentina may ban exports supported the corn rally but neither rumor could be confirmed.
 
However, near panic buying in the cash corn market in the Midwest and at the gulf for export has helped to support futures as the cash premiums have not been seen in many years. Bearish weather news from Argentina and a negative tone for outside market forces helped to pressure the market early.
 
However, speculative buying emerged to provide support with talk that the cash market is strong enough to keep buyers active on minor set-backs. Exporters who have booked recent deals to Mexico and others are finding it difficult to buy the corn in the cash market due to slow producer selling and surging basis levels.
 
Funds have been noted buyers on the session and the rally has pushed the market to the highest level since January 12th, the day of the bearish USDA updates on production and stocks. Open interest was up 7,949 contracts on the strong rally yesterday. March Rice finished down 0.065 at 14.615, 0.045 off the high and 0.085 up from the low.
 
Wheat Futures Closed Higher
 
March Wheat finished up 13 3/4 at 633 1/2, 4 1/2 off the high and 19 1/2 up from the low. July Wheat closed up 12 at 666 1/4. This was 17 1/4 up from the low and 1 1/4 off the high.
 
March wheat closed sharply higher on the session as rumors that Russia would impose a tax on exports to ensure wheat supply at home helped to spark some buying and short-covering. Weakness in the other grains and a negative tilt to outside market forces helped to pressure the market early.
 
However, a turn up in corn and talk that US wheat is now competitive on the world market helped spark some speculative buying early. The move back over yesterday's highs sparked aggressive short-covering and activated stops to drive the market sharply higher into the mid-session. The rally pushed the market to the highest level since January 12th. Talk of a record net short position from speculators added to the positive tone. March Oats closed down 1 at 294 1/2. This was 2 1/2 up from the low and 4 off the high.
 
Soybean Futures Closed Higher
 
March Soybeans finished up 2 1/2 at 1220, 9 1/2 off the high and 16 1/4 up from the low. May Soybeans closed up 3 1/4 at 1228 3/4. This was 16 3/4 up from the low and 9 1/4 off the high.

March Soymeal closed up 2.5 at 323.5. This was 5.3 up from the low and 3.8 off the high. March Soybean Oil finished down 0.07 at 51.35, 0.24 off the high and 0.35 up from the low. March soybeans closed slightly higher on the session as the market shook off early sharp selling pressures to turn higher with the help of strength in corn and wheat.
 
Rumors that Russia would tax exports supported wheat and rumors that Argentina may ban exports supported the corn rally and soybeans followed the other grains higher. A negative tilt to outside markets plus news that parts of Argentina received heavy rains in the last 24 hours helped to drive the market lower early in the session.
 
Sharply higher trade for corn and wheat helped drag the market back up near unchanged on the day into the mid-session. Traders indicated that drier parts of Santa Fe and Cordoba Argentina received 1 1/2 to 2 1/2 inches of rain in the last day and that this rain may go a long way in helping to boost crop conditions. In addition, the 6-10 day forecast was seen as "wetter" and this added to the negative tone overnight. Open interest was down 3,971 contracts on the strong rally yesterday.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on January 26, 2012, 01:26:39 PM

World Corn Trade, US Corn Exports Boosted This Month
24 January 2012


GLOBAL - Global corn trade forecast for 2011/12 is increased 0.7 million tons this month to 94.7 million. China's imports are projected to reach 4.0 million tons, up 1.0 million based on US export shipments and sales.

As of 5 January 2012, US Export Sales reported local marketing year shipments of 2.1 million tons and outstanding sales to China of 1.2 million. Moreover there remain 1.9 million tons of outstanding sales to "unknown" destinations, and often sales to China have been switched from the "unknown" to China as they are shipped. Other changes to projected 2011/12 imports include: a small increase in imports by South Africa as stocks have become tight ahead of harvest; a reduction of 0.4 million tons to 1.6 million for imports by Syria, caused by political turmoil, financial, and logistical problems; and 0.1 million tons trimmed from Taiwan’s imports based on the slow pace of recent purchases.


US corn exports by month
 

Argentina’s 2011/12 trade year (October-September) corn exports are reduced 1.0 million tons this month to 17.5 million as a sharp reduction in production limits export potential. However, this is more than offset by increases for the United States, Russia, and Paraguay. Russia’s forecast corn exports are increased 0.4 million tons to 1.0 million based on the pace of recent shipments and the larger crop. Paraguay’s corn export prospects are increased 0.3 million tons to 1.8 million based on strong shipments during the last months of 2011.

US 2011/12 corn exports are projected to reach 42.0 million tons, up 1.0 million this month (up 50 million bushels to 1.65 billion bushels for the September-August local marketing year). Based on Census and grain inspections data, US corn exports for October through December 2011 were above levels a year ago. However, as of 5 January 2012, outstanding export sales reached 10.5 million tons, down 11 per cent from a year ago. The increased export forecast is still down 7 per cent from a year earlier, reflecting the expected slowdown in shipments in future months presaged by the level of outstanding sales.

US 2011/12 sorghum exports are projected down 0.25 million tons this month to 1.65 million (down 10 million bushels to 60 million for the local marketing year). A sharp cut in estimated production is limiting exports. The slow pace of sales and shipments confirms that little US sorghum is available for export. Shipment data for October through December 2011 are less than half the previous year’s levels. As of 5 January 2012, outstanding sorghum sales were only 101,200 tons, down 86 per cent from a year earlier. The reduction in US exports is reflected in lower expected imports by Mexico.

Global barley trade is increased marginally this month to 16.3 million tons due to an increase for Argentina. Argentina’s barley exports are raised of 0.2 million tons to 2.4 million as the recent sales pace has been strong. Uruguay’s imports are increased slightly.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 03, 2012, 01:31:20 AM
Thursday, February 02, 2012
China Vows Enhanced Agricultural Investment
CHINA - China's central authorities on Wednesday said the nation will continue to step up investment and subsidies for agriculture this year in order to stabilize grain production.


A document publicized Wednesday by the Central Committee of the Communist Party of China (CPC) and the State Council, or China's cabinet, said that the country will continue to expand its fiscal budget for agriculture in 2012 and direct more of the country's fixed-asset investment toward the sector.

The document also said the country will boost investment in agricultural science and technology. It said the government should play a leading role in investment for agricultural science and ensure that the investment will create "significantly" faster growth compared to fiscal revenues.

The country will also offer more subsidies for major grain-producing areas and farming cooperatives, with direct subsidies for farmers to be increased, the document said.

It said the country would further improve the output capacity of China's 800 major grain-producing counties and support the building of production bases for vegetables, cotton, edible oil crops, and sugar.

Government data showed China's grain output rose to a record high of 571.21 million tons in 2011. The figure represented a year-on-year increase of 4.5 percent and marked the eighth consecutive year of growth for the country's grain output.

However, the document warned the Party should remain clear-minded despite the achievements as the current severe and complicated situation of the world economy and the impact of climate change pose risks and uncertainties to the nation's agricultural development.

Meanwhile, the shortage of arable land and fresh water present challenges to the sector, the document said.

According to the government paper, efforts will be further made to stabilize the raising of live pigs, as a scarcity of pork last year pushed up inflation.

The country will encourage banks to step up lending to the rural regions and support commercial banks to set up township outlets. It will continue to support micro-credit businesses to farmers while encouraging banks and rural credit cooperatives to extend more credit to small and micro-sized firms in the counties.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 04, 2012, 01:12:09 PM
Friday, February 03, 2012
NCBA Cattlefax: Hope for Strong 2012 Corn Harvest
US - There is a strong need for a successful 2012 corn harvest, as the US competes on global markets. Meanwhile global demand for ethanol is pushing US corn usage up, said the CattleFax team at the NCBA Convention and Trade Show. Charlotte Johnston, editor reports.

The range bound for monthly projected stock-to-use levels has been between five to 6.8 per cent since October 2011, and is expected to range from 5.5 per cent to 7.5 per cent in April 2012.

The potential to move US corn stocks-to-use levels above 7.5 per cent has likely been deferred to the 2012-2013 marketing year, where they could reach eight to 11 per cent.

This is obviously dependent on an increase in acres harvested and yields being average or more.

Corn carryover from 2011-2012 is expected to be historically low, which supports the need for a record corn crop in 2012.

However with poultry and cattle production declining, and competitive wheat prices, corn use in feed could fall.

With supply tight, there are concerns that importing countries are looking elsewhere. Both Ukraine and Argentina had strong crops last year, and with soybean trading low it is expected that corn plantings will increase in these countries.

However dry weather in Argentina is a concern for corn stocks.

Already US export commitments in 2012 are lower than they were in 2011, however demand from China is still strong.

Corn is becoming a more and more global market, following in the steps of wheat and cattle.

US projected plantings are looking positive, with 2012 estimated plantings looking at around 94 million acres, two million more than last year.

If these plantings are harvested successfully then it is likely that US corn-to-use levels could reach those higher numbers.

With the above in mind, outlook prices for corn are resisting $6.5/ 6.75 a bushel, and looking likely to be around $5.5/ 5.75 a bushel.

Ethanol

Total ethanol usage increased six per cent in 2011, with exports driving this increase with a 200 per cent increase.

US domestic use of ethanol is approaching 2003 lows, with a three per cent decline in usage in 2011. Contrary to this, demand for exports is increasing offsetting the falls in domestic demand. CattleFax predicts that exports will use 300 million bushels of corn in 2012, creating a name for itself on the global energy markets.

It is expected that this growth will continue for the next few years.

There is a bit of a discrepancy over the amount of corn to be used in US ethanol production in 2012, with the USDA estimating 5 billion bushels, but the US Energy Information Agency coming in with a slightly higher estimate of 5.132 million.

CattleFax believes this to be somewhere in the middle.


Charlotte Johnston, Editor
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 11, 2012, 10:55:19 AM
Friday, February 10, 2012
Public Resistance Ousts GM Crops From EU
EUROPE - Public resistance to genetically modified crops has ensured that the area grown in Europe in 2011 remained at 0.1 per cent of all arable land, shows figures released yesterday by Friends of the Earth Europe. In comparison, organic farming accounted for 3.7 per cent.


The figures follow recent announcements of the biotech industry retreating from parts of Europe.

Mute Schimpf, food campaigner at Friends of the Earth Europe said: "The public’s rejection of genetically modified crops has ensured that they are confined to small pockets of the European Union. Politicians need to listen to public opinion and throw their weight behind the demand for greener and safer farming. Genetically modified crops should play no role in the future of Europe’s farming."

Last month the world’s biggest chemical company, BASF, announced that it was halting the development and commercialisation of genetically modified crops in Europe. It said its decision was due to, "lack of acceptance for this technology in many parts of Europe – from the majority of consumers, farmers and politicians."

Similarly Monsanto announced that it would not sell its genetically modified maize, MON810, in France in 2012, and beyond.

Mute Schimpf continued: “Resistance to genetically modified crops isn’t restricted to Europe. People worldwide are objecting to the power of the biotech companies and their push to control the global food chain.

"The evidence against genetically modified crops continues to grow. Since their introduction in the Americas, herbicide use has rocketed as farmers try to control fast evolving super-weeds, now resistant to many chemicals. Communities and nature are paying the price of the resulting pollution. The biotech system of farming is a dead-end and will fail to meet the needs of the future."

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 14, 2012, 03:45:43 AM
Monday, February 13, 2012
Plant Breeding Breakthroughs to Reduce Soy Imports
FRANCE - France ranks above average in being protein-independent for the feed sector among European Union (EU) Member States. While soybean meal consumption has remained relatively stable at 4 million metric tons (MT) annually over the past 25 years, use of rapeseed meal has increased from minor levels to more than 2 million MT annually, all domestically sourced as a by-product of France's biodiesel industry.
 

Farmer unions have repeatedly called for increasing independence in protein feeds, but under the current policy conditions and with no major genetic breakthroughs for domestic soybean or pea production, France is expected to continue to be a major consumer and importer of soybean meal in the future.

As a major livestock, poultry and dairy producer in the European Union (EU), France consumes large quantities of feed. In fact, France is the EU's leading producer of compound feed with Germany and Spain, with 15 percent of the EU total production in each of these three Member States.

In 2010, France's compound feed production totaled 21.5 million MT. In 2011, preliminary estimates indicate that France's production of compound feed was marginally lower than in 2010.

In marketing year (MY) 2010/11, approximately 7 million MT of oilseed meals were consumed in France annually. They mainly consisted of soybean meal (4 million MT), followed by rapeseed meal (2.3 million MT), and sunflower meal (800,000 MT).

Main Drivers in Favor of Soybean Products Imports
Over the past decades, the oilseeds industry has repeatedly complained about France's dependence on imported products for protein-rich ingredients in animals feed. The high demand of the livestock, dairy, and poultry industries and the grains and soybean meal basic formulation of compound feed are not the only factors favoring high consumption of soybean meal.

In addition, the ban of meat and bone meals in animal feed in place since the bovine spongiform encephalopathy (BSE) crisis in 1996, and the limited domestic production of soybean products and substitutes are also major drivers in favor of soybean products imports.

The incorporation of grains has been favored by the Common Agricultural Policy (CAP) since its first reform in 1992, which pressured grain prices down. The use of grains in animal feed increased from 30 per cent in 1991 to 50 per cent currently. In addition, grain consumption in animal was been favored by the development of the swine and poultry industries in France, which are large consumers of grains.

Genetics and Plant Breeding would Significantly Increase in France's Production of Soybeans and Peas
According to the USDA report, pea varieties available for the farmers have not benefitted from the extensive research and plant breeding programs that grains and oilseeds have witnessed. As a result, the uncertainty in yields for peas remains high, currently, making farmers reluctant to grow these crops.

As a result, oilseeds and pulses farmer organisations, as well as Parliamentarians, called for intensifying varietal research on peas, both from the public (National Institute for Research in Agriculture - INRA), and the private sector (seed industry).

Although oilseeds and pulses farmer associations didn't call for having access to biotechnology in soybeans, several of their members as well as Parliamentarians denounced the inconsistency of the French and EU policy to approve imports but ban cultivation of biotech crops. Some Parliamentarians considered that they "won't be able to refuse innovation for a very long time."

There are many, among French farmers, who openly say they would be happy to grow biotech herbicide-tolerant soybeans if they were approved for cultivation in France. Some even go as far indicating the potential acreage of 300,000 ha of soybeans including herbicide tolerant varieties, which is twice as high as the target indicated by the oilseeds and pulses growers associations.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 18, 2012, 12:40:46 AM
USDA Feed Outlook - February 2012
US 2011/12 corn exports are increased 50 million bushels this month to 1.7 billion as lower production prospects in Argentina reduce competition in global markets.


US Corn Exports Higher With Reduced Competition
US corn supplies are projected up slightly due to increased imports, but the larger increase in exports leaves ending stocks down. Global corn trade is up, supported by increased imports by the EU. World coarse grain production is forecast lower mostly due to a 4.0- million-ton reduction in projected corn production in Argentina. With world coarse grain use projected nearly unchanged, global ending stocks decline.

US corn stocks-to-use ratio

Domestic Outlook

Higher Trade Boosts Feed Grain Supplies and Use for 2011/12
US feed grain supplies projected for 2011/12 edge up 0.3 million metric tons this month to 358.3 million, with increases for corn and oats imports. Supplies, however, remain down 6 percent from last year. Total feed grain use is up due to higher projected corn exports. At 335.5 million metric tons, forecast use is raised 1.3 million tons from last month but remains down 4 percent from the previous season. With demand exceeding production in 2011/12, ending stocks are expected to be drawn down 9.5 million tons from an already low carryin. At a projected 22.8 million tons, stocks would be the lowest since the end of the 1995/96 marketing year.

Feed and residual use for the four feed grains plus wheat on a September-August marketing year basis is lowered this month to 126.2 million metric tons due to lower wheat feed use. Grain-consuming animal units (GCAUs) are projected at 93.6 million this month, down slightly from last month due to a very small inventory change. Broiler weights are down, contributing to lower feed use. Feed and residual use per animal unit in 2011/12 is unchanged this month at 1.35 tons, which is down from 1.39 tons in 2010/11.

US corn utilization

Forecast Corn Exports Raised, Stocks/Use Lowest Since 1995/96
US corn exports were increased 50 million bushels this month due to adverse weather conditions in Argentina, boosting prospects for higher demand. Corn imports are projected 5 million bushels higher, mostly reflecting strength in reported imports through November. As a result, ending stocks slip to 801 million bushels, down 45 million bushels from last month’s projection.

The stocks-to-use ratio is projected at 6.3 percent, down from 6.7 percent last month and the lowest level since 1995/96, when the stocks-to-use fell to 5.0 percent. Unlike in 1995/96, corn being held by farmers for delivery to ethanol plants is expected to account for a significant portion of 2011/12 ending stocks, making it more difficult to draw down ending year supplies.

December 1 US hay stocks and RCAU

Minor Changes Made to Feed Grain Price Projections
The midpoint of the projected range for the 2011/12 US corn price received by farmers remains at $6.20 per bushel this month, but the range is narrowed by 10 cents at each end, to $5.80-$6.60 per bushel. With the exception of prices in September, corn prices at the farm gate have been reported below $6.00 per bushel so far this marketing year. If the preliminary January price of $5.90 per bushel is confirmed, the farm price for the first 5 months of this marketing year will average $5.90 per bushel, weighted by 5-year average marketing percentages by month. The farm price has been below prevailing cash market bids due to farmers forward contracting when prices were lower. Farm gate prices are expected to average around $6.50 per bushel over the coming months to reach the $6.20 midpoint of the projected season average price range. The projected price range for sorghum was narrowed by 10 cents on each end to $5.70 to $6.50 per bushel, and the barley price range was narrowed by 5 cents on each end to $5.15 to$ 5.65.

US corn prices expected to hit record as stocks continue to tighten

International Outlook

Global Coarse Grain Production Prospects Reduced
World coarse grain production in 2011/12 is projected at 1,142.2 million tons, down 3.4 million this month mostly due to reduced prospects in Argentina. Global corn production is forecast down 4.0 million tons to 864.1 million, and sorghum is reduced 0.1 million tons to 60.6 million, but barley prospects are increased 0.6 million tons to 134.0 million and oats are up 0.1 million tons to 23.2 million.

In Argentina, crop damage was confirmed for corn and sorghum. While crucial rains and milder temperatures in the latter half of January allowed filling corn and sorghum to recoup some loses, rainfall for the month was below normal in most of the key growing areas, and temperatures averaged above normal. Forecast corn harvested area is reduced 0.2 million hectares to 3.6 million as corn with poor pollination is expected to be harvested for silage instead for grain. The projected yield in Argentina is reduced 11 percent this month to 6.1 tons per hectare, as damage done by the hot, dry conditions in December has been confirmed, as were additional yield loses caused by hot and dry weather in early January. Sorghum is more drought tolerant than corn, but the crop has experienced serious stress. Argentine sorghum yields are forecast down 8 percent this month to 4.3 tons per hectare, reducing production 0.3 million tons to 4.4 million tons. The barley harvest in Argentina was completed in mostly favorably dry conditions, and area harvested for grain and yields are reportedly higher than expected earlier, boosting production 0.7 million tons to 4.0 million.

While the drought in South America during December and January extended into Southern Brazil, damaging production prospects for first-crop corn, favorable conditions for the second crop are offsetting, leaving total projected corn production unchanged this month. In Paraguay, however, corn production losses will not be offset, and 2011/12 area and yield prospects are reduced this month, cutting production 0.35 million tons to 1.65 million.

In Australia, ample summer rains in Queensland and Northern New South Wales improved sorghum yield prospects, boosting 2011/12 production 0.2 million tons to 2.6 million. The Philippines reported increased corn plantings, increasing projected production 0.14 million tons to 7.14 million.

EU 2011/12 corn production is increased 0.2 million tons to 64.5 million, based on higher yields reported for Italy. Kazakhstan reported 2011/12 harvest results, generally trimming coarse grain area but increasing yields. Barley production is reduced 0.1 million tons to 2.6 million, and rye is reduced, but these reductions are more than offset by increases for oats, up 0.1 million tons to 0.3 million, and small increases for corn and millet.

Changes to the previous year’s coarse grains supply and demand balances are mostly offsetting, but boost world 2011/12 beginning stocks 0.3 million tons this month to 166.2 million. World corn beginning stocks are up 0.8 million tons to 128.8 million, mostly due to a 0.5-million-ton increase for South Africa caused by reduced exports and increased imports estimated for 2010/11. Increased 2010/11 corn imports boost Brazil’s 2011/12 beginning stocks 0.3 million tons, with other changes smaller and mostly offsetting.

Global Coarse Grain Use Prospects Little Changed, Ending Stocks Lower
World coarse grain use in 2011/12 is projected to reach 1,149.9 million tons, up 0.3 million this month. Global corn use is forecast down 0.4 million tons to 867.6 million, but barley is up 0.6 million to 136.8 million.

Canada’s corn use is projected down 0.4 million tons to 11.1 million as a stocks report verifies reduced use during the early months of 2011/12, and meat production prospects are sluggish. However, corn use is projected higher for Argentina, up 0.3 million tons due to expanding poultry production; for Ukraine, up 0.25 million tons due to increased feed prospects; for Chile, up 0.1 million tons as less sorghum is expected to be imported; and for Kazakhstan, up slightly based on increased production. Global local marketing year imports increase more than exports this month, trimming world corn disappearance.

Kazakh barley use is forecast down 0.4 million tons to 1.8 million as increased exports and reduced production limit domestic use. Saudi Arabia’s barley use estimated for 2010/11 is trimmed 0.3 million tons due to tight supplies and the increased use of alternative feed ingredients. These changes support a 0.2-millionton reduction in Saudi Arabia projected 2011/12 feed use. However, these reductions are more than offset by increases for Ukraine, Jordan, Argentina, and Canada. Also, for barley, local marketing year imports increased less than exports, boosting global disappearance.

Reduced 2011/12 coarse grain supplies and nearly unchanged use prospects combine to cut forecast global ending stocks 3.3 million tons to 158.5 million. Corn stocks are projected down 2.8 million tons to 125.3 million, while barley is down 0.6 million to 21.9 million.

The largest reduction in projected 2011/12 ending stocks is for corn in Ukraine, down 2.25 million tons this month to only 1.30 million. The pace of exports and domestic use is expected to keep Ukraine’s corn stock build up modest, despite the huge increase in production. Reduced production prospects are expected to limit stocks in Paraguay, down 0.35 million this month. Strong corn exports are reducing projected ending stocks for Brazil and Russia by 0.2 million tons each. There are also small reductions this month in ending corn stocks for Taiwan and Mexico. These reductions are partly offset by increased stocks prospects for the EU, up 0.7 million tons to 5.9 million as imports and production are higher this month, but meat production in the EU prospects remain sluggish. South Africa’s corn stocks are up 0.5 million tons to 3.4 million, as internal prices have been high enough recently to slow exports, increase imports, and maintain domestic stocks. There are also small increases in corn ending stocks this month for the Philippines, Saudi Arabia, and Kazakhstan.

Russia’s barley ending stocks for 2011/12 are down 0.7 million tons to 1.3 million as strong exports limit stocks. Increased export prospects also limit Canada’s barley ending stocks, down 0.4 million tons this month to 1.0 million. There are small reductions this month in projected barley ending stocks for Kazakhstan, Argentina, and the EU. However, for Ukraine, the slow pace of exports boosts stocks prospects 0.5 million tons to 1.7 million. Saudi Arabia’s ending stocks are increased 0.1 million tons to 1.7 million, supported by the pace of imports.

US Corn Exports up on Reduced Competition and Increased Trade
World corn trade in 2011/12 (October-September) is projected to reach 95.6 million tons, up 1.0 million this month. EU imports are forecast up 1.0 million tons to 4.0 million as the pace of import licenses shows that there is demand for imported corn despite increased production this year. Brazil’s corn imports are increased 0.3 million tons to 0.8 million based on shipments from Paraguay. South Africa’s imports are up 0.2 million tons as it is importing yellow corn due to tight supplies and high internal prices while continuing to export white corn. Corn imports are up by smaller amounts for Chile and the United States. These increases are partly offset by Canada’s corn import reduction of 0.4 million tons to 1.0 million. Canada’s stock report revealed weaker than expected demand for corn in early 2011/12.

Argentina’s corn export prospects for 2011/12, down 3.5 million tons this month to 14.0 million, are sharply constrained by reduced production prospects. Recent high internal corn prices in South Africa are slowing the pace of exports, down 0.3 million tons to 2.0 million. Exports are increased for a number of countries to offset these declines and meet increased demand. Ukraine’s corn exports are up 2.0 million tons this month to 14.0 million based on the strong pace of recent exports that reveal that corn for export is getting priority access to rail cars and port facilities. The massive year-to-year increase in production supports unprecedented export levels, matching those of Argentina. Brazil’s corn exports are boosted 0.5 million tons to 9.0 million based on good prospects for the “safrina” second-crop corn. EU corn exports are up 0.5 million tons to 2.5 million based on the pace of export licenses. Several Eastern European countries have a surplus of corn and are exporting outside the EU, while in Southern and Western Europe, other countries are importing. Russia’s corn exports are up 0.2 million tons to 1.2 million based on the strong pace of shipments to date. There is also a small increase in Moldova’s corn export prospects.

US corn exports in 2011/12 (October-September) are projected up 1.5 million tons to 43.5 million (up 50 million bushels to 1.7 billion bushels for the September- August local marketing year). The forecast is down 4 percent from 2010/11. Import demand in recent months has supported the pace of shipments, with Census corn exports for October to December 2011 at 11.7 million tons, nearly 5 percent higher than the previous year. January 2012 corn export inspections reached 3.45 million tons, up 18 percent from a year ago. However, as of February 2, 2012, outstanding export sales reached only 10.3 million tons, down from 12.4 million a year earlier. Tight US supplies and high prices are expected to keep sales and shipments in the second half of 2011/12 from matching levels of the previous year.

World barley trade for 2011/12 (October-September) is projected up 0.7 million tons this month to 17.0 million. Imports are increased for Saudi Arabia, the EU, Jordan, and Morocco. Ukraine’s exports are cut 1.0 million tons to 3.4 million as the recent pace of shipments has been much slower than expected. Offsetting these changes are increased export prospects for Argentina, up 0.5 million tons to 2.9 million, and increases of 0.3 million each for Canada, the EU, Kazakhstan, and Russia.

Global sorghum trade is reduced 0.3 million tons to 5.1 million due to reduced export prospects for Argentina caused by lower production. Import prospects are reduced for Chile and Japan but increased slightly for Egypt. Sluggish US exports and very low outstanding sales support the current US export forecast, unchanged this month, but down 57 percent on the October-September trade year.

Argentina coarse grain production


February 2012

Published by USDA Economic Research Service

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 22, 2012, 02:43:38 AM
Tuesday, February 21, 2012
Corn and Soybean Export Progress
US - In December 2011, the USDA judged total corn production prospects in Argentina and Brazil at 3.54 billion bushels, writes Darrel Good.


That forecast was reduced by 120 million bushels in January and by an additional 160 million bushels earlier this month. All of the reduction has been for the Argentine crop. Similarly, combined soybean production in those two countries was forecast at 4.67 billion bushels in December, but was reduced by 90 million bushels in January and an additional 165 million bushels earlier this month.

Total precipitation has been well below average in southern Brazil since late January, suggesting that production there may fall short of the current forecast. Prospects for much smaller South American crops than initially forecast have raised expectations for stronger export demand for US corn and soybeans during the remainder of the 2011-12 marketing year and in the first half of the 2012-13 marketing year. Over the past two months, the USDA has raised the US corn export forecast for the current year by 100 million bushels, to a total of 1.7 billion bushels. The forecast is still 100 million bushels below the initial forecast made in May 2011 and 135 million less than exports of a year ago. The forecast of US soybean exports during the current year has declined steadily from the initial forecast of 1.54 billion bushels to the current forecast of 1.275 billion bushels, 226 million less than exported last year.

Export progress is being carefully monitored for indications that shipments for the year might exceed current forecasts. Export prospects for corn are especially important since year-ending stocks are expected to be small. There are three regular sources of information relative to the progress of US corn and soybean exports. A weekly report, released on Monday morning (except for holidays), reports quantities inspected for export in the previous week ended on Thursday and cumulative inspections since the beginning of the marketing year. The US Export Sales Report, released on Thursday morning, reports cumulative marketing year exports and the magnitude of unshipped sales as of Thursday of the preceding week. Finally, the US Census Bureau reports exports on a monthly basis. That report is typically released about six weeks after the month ends. The Census Bureau estimates for the marketing year become the official estimates shown in the USDA’s WASDE report.

For corn, cumulative 2011-12 marketing year export inspections totaled 741 million bushels through February 9. Through December 2011, cumulative marketing year Census Bureau export estimates exceeded inspections by 23 million bushels. Assuming that margin has persisted, cumulative exports through 9 February totaled 764 million bushels. To reach the USDA projection of 1.7 billion bushels for the year, exports need to total 936 million bushels during the remainder of the year. That is an average of 32.1 million bushels per week, compared to the average to date of 33 million. As of 9 February, the USDA reported unshipped export sales of 420 million bushels. Export commitments (shipments plus outstanding sales) totaled 1.184 billion bushels, requiring additional sales of about 18 million bushels per week. For the five weeks ended 9 February, new sales averaged 34 million bushels per week.

For soybeans, cumulative marketing year export inspections totaled 794.4 million bushels through 9 February. Through December 2011, cumulative Census Bureau export inspections were 5.5 million less than inspections. Assuming that margin has persisted, cumulative exports were near 789 million bushels on 9 February. To reach the USDA projection of 1.275 billion bushels, exports need to total 486 million bushels during the remainder of the year, or an average of 16.7 million bushels per week. Since exports begin a sharp seasonal decline in April, a comparison of the needed rate to the average rate to date is not useful. The needed rate, however, is about 1.7 million bushels larger than the average during the same period last year. As of 9 February, the USDA reported unshipped export sales of 221.5 million bushels, so that export commitments stood at 1.01 billion bushels. New sales of about 9.1 million bushels per week are needed for exports to reach the projected level. Since the seasonal decline in exports has not yet begun, the current pace of sales is well above the needed rate, averaging nearly 21 million bushels per week for the five weeks ended 9 February.

Based on the current pace of export activity and the likelihood that South American production will fall short of current projections, U.S corn and soybean exports for the current year are expected to exceed current projections.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 24, 2012, 03:03:01 AM

Global Coarse Grain Use Prospects Little Changed, Ending Stocks Lower
22 February 2012




GLOBAL - World coarse grain use in 2011/12 is projected to reach 1,149.9 million tons, up 0.3 million this month. Global corn use is forecast down 0.4 million tons to 867.6 million, but barley is up 0.6 million to 136.8 million.
 
Canada’s corn use is projected down 0.4 million tons to 11.1 million as a stocks report verifies reduced use during the early months of 2011/12, and meat production prospects are sluggish.
 
However, corn use is projected higher for Argentina, up 0.3 million tons due to expanding poultry production; for Ukraine, up 0.25 million tons due to increased feed prospects; for Chile, up 0.1 million tons as less sorghum is expected to be imported; and for Kazakhstan, up slightly based on increased production. Global local marketing year imports increase more than exports this month, trimming world corn disappearance.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 24, 2012, 03:04:07 AM

Argentina May Export Corn to China
22 February 2012



ARGENTINA - Argentina may export around three million tons of corn to China this year, as a result of an agreement last week in Buenos Aires at the ministry of Agriculture.

"This agreement will make China a significant importer in the coming years, China is expected to import about 3 million tons of corn," said a ministry statement.
 
According to iEco, the agreement for exporting corn from Argentina to China was signed by Minister of Agriculture Norberto Yauhar and Minister of General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) of China, Zhi Shuping.
 
The statement from the ministry said China was self-sufficient until 2010, but due to increased consumption of pork and poultry, domestic demand for maize for animal feed had also increased.
 
The deal comes weeks before the Argentine farmers start harvesting the corn which, although it was affected by drought, is expected to generate an output of at least 22 million tons.
 
Argentina is the second largest exporter of corn and the leading international oil and soybean meal exporter.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on February 25, 2012, 03:45:23 AM
Friday, February 24, 2012
CME: Corn Prices for 2012/13 to be Almost 20% Lower
US - USDA expects farmers to plant about 94 million acres of corn this spring, 2.1 million acres more than the previous year, write Steve Meyer and Len Steiner.


Before looking at the upcoming USDA cattle on feed report, a few words are in order about the USDA Outlook forum currently under way in Washington DC. USDA is expected to issue its unofficial projection of grain supplies for 2012/13 during the outlook presentations and markets are paying close attention to some of their initial assumptions as they will influence the official estimates that will be released in May. In his presentation, the USDA chief economist Joseph Glauber will note that USDA expects farmers to plant about 94 million acres of corn this spring, 2.1 million acres more than the previous year. Combined wheat, corn and soybean acres are expected to increase by 5.6 million acres. Ethanol use also is expected to slow down and USDA now pegs ethanol demand for 2012/13 at 4.95 billion bushels compared to the current year estimate of 5 billion bushels. Increased acres, stagnant demand for ethanol and limited feed use (compared to prior years) will likely cause USDA to bolster its estimates for corn ending stocks in 2012-13. USDA now estimates corn prices for 2012/13 at $5 per bushel, down almost 20% from year prior. There is plenty that could go wrong this year and pressure prices higher but this will be first salvo in what promises to be another volatile year considering uncertainty about the size of current corn stocks, escalating energy prices and dry conditions in key corn production areas.

The upcoming cattle on feed report is expected to show that on feed supplies will likely be steady compared to the previous month although about 2.5% higher than a year ago. Despite the higher feedlot inventories, cattle prices continue to escalate as a larger portion of those cattle have yet to reach market weights. The supply of feeders outside of feedlots is tight and this is reflected in feeder prices which continue to hit record highs on a daily basis. The CME Feeder Cattle index closed on Wednesday at a new record high of $156.57/cwt, 21% higher than a year ago.

Feeder supplies are expected to remain tight in part because producers are expected to hold back a few more replacement heifers. As usual, analysts polled ahead of the report show a wide range of opinions regarding the number of cattle placed in January (see table). On average, they expect placements about 1.2% below year ago levels. Despite strong cattle prices outfront, feedlots are cautious about placing $160 feeders with $6+ corn. Cattle futures have surged higher in recent days (although they were down yesterday) as packers push through higher prices. The big question mark, however, is the outlook for cattle and beef prices after April 15. Will current record high beef values scare away retailers and force them to limit beef features into the grilling season? Last year cattle broke sharply in May and memories of those loses are still fresh. As for marketings, the analyst survey showed they expect feedlot sales about steady with a year ago. The steer and heifer slaughter data for January shows slaughter was only slightly lower than a year ago.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 10, 2012, 12:49:50 PM
Friday, March 09, 2012
Near-Record Wheat Production Expected This Year
GLOBAL - FAO has forecast that 2012 world wheat production will be the second highest on record at 690 million tonnes and also announced that international food prices rose one per cent in February — the second increase in two months.


Published this week, FAO’s quarterly Crop Prospects and Food Situation report forecast a 2012 wheat crop 10 million tonnes or 1.4 per cent down from the record 2011 harvest but still well above the average of the past five years.

Although plantings have increased or are forecast to increase in many countries this year in response to continuing strong prices, a return to normal yields is expected in areas where record highs were achieved last year, the report said. But it was still too early for a global forecast of 2012 cereal output, it added.

Impact of cold weather
Crop Prospects also noted a firming of international cereal prices in recent weeks due to tightening current wheat supplies and concerns over the impact of severe cold weather in Europe and the Commonwealth of Independent States.

Turning to the situation at regional level, the report said that adverse weather in West Africa caused a sharp drop in cereal and pasture production in large parts of the Sahel.

This, combined with high food prices and civil strife, has led to high food insecurity and increased malnutrition in several countries, notably in Niger, Chad, Mauritania, Mali and Burkina Faso.

In the Near East, food security has deteriorated in the Syrian Arab Republic and Yemen following civil conflict in the two countries. In Syria about 1.4 million people have become food insecure while thousands of families have been forced to flee their homes in Yemen.

In Eastern Africa, despite some improvement, the food situation of vulnerable groups remains precarious, especially in pastoral areas affected by earlier drought. The food security situation in the Sudan and South Sudan is of concern following poor harvests.

In Southern Africa, overall crop prospects remain satisfactory despite dry spells and cyclones in some areas.

Gains in India
In Far East Asia, prospects for the 2012 wheat crop are generally favourable with output expected to reach last year’s record level due in particular to good gains in India.

In Central America, dry weather reduced plantings of the 2012 secondary maize crop in Mexico. Elsewhere, good maize harvests are estimated despite losses due to torrential rains during the recently concluded secondary seasons.

In South America, a prolonged dry spell affected the 2012 maize crop in Argentina and Brazil but above-average outputs are still forecast due to increased plantings.

The cereal import bill of Low-Income Food-Deficit Countries (LIFDCs) is expected to climb to a record level of $ 32.62 billion in 2012, slightly above the 2010/11 estimate, mainly due to a decline in production and a rise in import requirements in the major importing countries.

Food Price Index
FAO’s Food Price Index, published separately yesterday, rose 1 per cent, or 2.4 points from January to February. The Index climbed nearly two per cent in January – its first increase in six months.

The increase in the February Index was mostly driven by higher prices of sugar, oils and cereals while dairy prices fell slightly after a marked rise in January. At its current level, the Index was 10 per cent below its peak in February 2011.

Increased imports due to a weaker US Dollar and plunging freight rates have also characterized world markets since the beginning of 2012. This, combined with unfavourable weather conditions in major exporting countries has supported world prices in recent weeks, FAO said in a brief accompanying the Food Price Index.

Cereal prices
The FAO Cereal Price Index averaged 227 points in February, up 2 per cent, or 4.4 points, from January. International wheat prices rose most followed by maize, while rice quotations were generally lower.

The FAO Oils/Fats Price Index registered another gain in February to 239 points, 2 per cent or 5 points, higher than in January. Poor monthly production growth in palm oil, together with the prospect of a tight supply and demand balance for total vegetable oils were among the reasons.

The FAO Meat Price Index averaged 175 points in February, virtually unchanged from the previous month’s level. Prices of pig meat gained 3.4 per cent, sustained by strong purchases in Asia and recent disease outbreaks in the Russia Federation. By contrast, prices of poultry, bovine and sheep meat lost some ground.

The FAO Dairy Price Index averaged 205 points in February, down marginally from January, The decline was mainly caused by falling skim milk powder and casein quotations. However, prices of butter, cheese and whole milk powder remained relatively steady.

The FAO Sugar Price Index rose to 342 points in February, up 2.4 per cent, or 8 points, from January, but still 18 per cent (76 points) lower than in February last year. Last month’s increase was largely driven by unfavourable weather conditions in Brazil, the world's largest producer and exporter of sugar.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 14, 2012, 12:24:07 AM
Tuesday, March 13, 2012
Continued Focus on Corn Consumption and Stocks
US - May 2012 corn futures have traded in a range of about $1.00 per bushel since last fall, writes Darrel Good.


Since late January, the trading range has been about $.40 per bushel and the current price is near the top of that range. The narrowing of the trading range for old-crop corn prices may point to a breakout from the long standing sideways trend. The central question for the direction of old-crop prices is whether consumption has slowed enough to ensure a minimum level of year ending stocks.

The USDA currently projects 2011-12 marketing year ending stocks of corn at 801 million bushels. A minimum level of carryover is about 650 million bushels, assuming normal timing of the new-crop harvest. Some had expected the USDA to increase the projection of marketing year exports in last week’s WASDE report, but that did not happen. There were also rumors late last week that China purchased large quantities of US corn, but those purchases had not been confirmed as of this writing. With the corn marketing year just passing the mid-point, export shipments need to average about 32.1 million bushels per week to reach the USDA projection of 1.7 billion bushels for the year. That compares to the average pace to date of 32.9 million bushels and the average pace of 37.1 million bushels per week during the last half of the 2010-11 marketing year. As of 1 March, unshipped export sales of US corn stood at 405 million bushels, 100 million less than on the same date a year earlier. New sales need to average about 17 million bushels per week in order for export commitments to reach 1.7 billion bushels. It appears that exports could still exceed the current USDA projection by a small margin.

For the year, the USDA projects corn use for the production of ethanol and co-products at 5 billion bushels, just below the record 5.021 billion bushels of last year. Through the first half of the 2011-12 marketing year, ethanol production exceeded that of a year ago by about 3.0 per cent. To reach the USDA projection of corn use for the year, ethanol production during the last half of the marketing year needs to be 3.8 per cent below the level of production during the last half of the 2010-11 marketing year. During the week ended 2 March, ethanol production was 2.6 per cent larger than in the same week last year. It appears that corn use for ethanol and co-product production will reach the USDA projection, but declining transportation fuel consumption and the delay in implementing E-15 suggests that the so called “blend wall” for E-10 is rapidly approaching. Ethanol exports will likely have to remain strong in order for ethanol production and corn use to reach the current projection for the year. Brazil has become a major importer of US ethanol over the past year. Ironically, US ethanol imports from Brazil may also increase as Brazilian ethanol qualifies as an advanced biofuel under the Renewable Fuel Standards while US ethanol does not. The result would be the very inefficient swapping of ethanol between the two countries.

There is still uncertainty about the on-going level of feed and residual use of corn and the implications for year-ending stocks. As pointed last week, the March Grain Stocks report will provide for an estimate of feed and residual use during the December –February quarter. Prospects for feed and residual use of corn during the summer quarter will be influenced by animal numbers as reflected in the monthly Cattle on Feed reports, monthly estimates of milk cow numbers, weekly broiler placements, and the 30 March Hogs and Pigs report. The estimated size of the upcoming wheat harvest and resulting prices may also have some impact on the feed demand for corn this summer.

The pattern of strong basis and inverted futures market prices referred to last week continues and has intensified in recent trading sessions. The expiring March 2012 futures contract is $0.14 premium to the July contract, compared to the $.05 discount at the end of February. It is still not clear if the strong basis and inverted futures market signals a shortage of corn or tight holding, or both. Anecdotal information suggests that a large portion of current inventories of corn are owned by farmers as other commercials have given up ownership in response to the lack of carry in the market. The estimate of March 1 stocks will reveal where stocks are being held, but will not reveal ownership of those stocks.

The 1 March stocks estimate, along with revealed rate of consumption over the next several weeks will determine how much strength in old crop prices is needed to stretch inventories until harvest. Expectations remain for a much larger crop and lower prices for the 2012-13 marketing year.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 21, 2012, 01:22:50 AM
Tuesday, March 20, 2012
Corn Yield Prospects Impact Prices
US - With 2011-12 marketing year-ending stocks of US corn expected to be near pipeline levels, the size of the 2012 crop has substantial price implications, writes Darrel Good.


Acreage intentions will be revealed in the USDA’s 30 March Prospective Plantings report, but much of the current discussion centers on prospects for the US average corn yield.

Widely differing views of yield prospects for 2012 have emerged. A number of factors may contribute to the diverse views, but four have received a lot of attention. These include (1) the timing of planting, (2) the magnitude and potential change in the trend yield, (3) expected summer weather conditions, and (4) the location and magnitude of acreage changes. A brief discussion of these factors follows, with more detailed analysis to be provided in upcoming posts at farmdocdaily.

The mild winter weather and early spring fieldwork suggests that the 2012 crop will be planted in a very timely fashion. There is a general perception that early planting results in a higher US average yield potential, all other things equal. Agronomic research in the Corn Belt generally reveals a slight yield penalty for extremely early planting (March), a wide planting window for maximum or near maximum yield potential (early to mid-April through early May), and a yield penalty for late planting that increases with the lateness of planting. While there is a clear yield penalty for late planting, there is not a similar yield premium for early planting. The majority of the crop is planted in the optimum window in most years. To have an effect on US average yield potential, a substantially larger or smaller portion of the crop would have to be planted outside the optimum window. For 2012, a smaller than average per centage of the crop planted late might increase yield potential, but that impact would be quite small.

Widely varying opinions about the trend in US average corn yields have emerged in recent years. The long term increase in average yields is associated with the development and adoption of crop production technology and crop management practices. The nature of those developments has varied over time, but there has been a steady flow of yield-enhancing technology and practices. For the most part, variation around the trend yield reflects variation in growing season weather, although events such as pest infestations or early occurrences of freezing temperatures can have a yield effect. Confusion about the yield impact of technology and weather can occur if there is a string of years with very favorable or unfavorable weather. In that case, the impact of weather can mistakenly be attributed to technology and give the impression that the underlying trend yield has changed. That appeared to have happened from 2003 through 2009 when generally favorable weather led some to believe that the underlying trend yield was increasing at a faster rate. The reverse may have occurred recently as poor weather in 2010 and 2011 resulted in low yields following the record yield of 2009. Overall evidence suggests that the trend in US average corn yields has been linear since 1960 (click here for more information).

Opinions about likely summer weather in the Corn Belt center on the ElNino/LaNina Southern Oscillation (ENSO). The Climate Prediction Center forecasts that the winter LaNina is transitioning to neutral conditions. Historically, such a transition has been mostly associated with corn yields near trend value, although deviations in both directions have occurred. Others are suggesting a transition to an ElNino and increased chances of an above trend yield in 2012.

It is generally expected that US corn plantings will increase by 2 to 3 million acres in 2012. It has been argued that the increase will occur in lower yielding areas and therefore prove to be a drag on the US average yield. However, the yield implication of increased acreage is likely to be extremely small. First, some of the increase in corn acreage may occur in the higher yielding areas of the eastern Corn Belt since acreage there in 2011 was below the recent peak of 2007. Second, a 2 to 3 per cent increase in acreage has the potential to only marginally impact the US average yield even if all the increase was in low yielding areas.

While the 2012 yield debate will continue well into the growing season, the most logical expectation is for an average yield near the long term trend. The trend yield for 2012 is just under 160 bushels per acre. The USDA’s early forecast for 2012 is for a yield of 164 bushels. With harvested acreage projected at 87 million acres, a 4 to 5 bushel difference in the US average corn yield represents a difference of 350 to 435 million bushels in crop size. Prospects of an average yield near 160 bushels would suggest that new crop corn prices are probably low enough, while prospects for a yield of 164 bushels or higher would likely push prices marginally lower.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 22, 2012, 09:12:15 AM
14 March 2012
USDA Feed Outlook March 2012
World 2011/12 coarse grain production and use are projected higher this month, but the increase in consumption is larger, trimming prospects for ending stocks.


 
Brazil’s corn production and exports are increased based on higher area for second-crop corn. Forecast EU corn feed use is increased, offsetting a reduction in expected wheat feeding. U.S. 2011/12 supply-and-use forecasts for feed grains are unchanged this month except for a small increase in oats imports and a corresponding increase in oats ending stocks. Projected ranges for 2011/12 farm prices for all feed grains are adjusted, but the midpoints of the ranges for corn and sorghum are unchanged. The midpoint of the projected price range for barley is lowered 5 cents per bushel and the range for oats is raised 5 cents per bushel.
 

World Coarse Grain Total Use and Ending Stocks
 


Domestic Outlook
 

U.S. Corn: Central Illinois Cash and Average Farm Price, Monthly
 


2011/12 Feed Grain Balance Sheet Nearly Unchanged
 
Projected U.S. feed grain supplies for 2011/12 edged up 86,000 metric tons this month on higher oats imports from Canada. The higher oats imports were reflected in projected supplies and ending stocks. Forecast feed grain supplies are 358.4 million tons, 0.1 million higher than last month’s projection but 22.1 million below 2010/11. The feed grain use forecast is unchanged from last month and is 12.8 million tons below 2010/11. At 22.9 million tons, ending stocks are forecast up less than 100,000 tons this month and are down 29 percent from 2010/11.
 
Feed and residual use for the four feed grains plus wheat on a September-August marketing year basis is unchanged again this month, remaining at 126.2 million metric tons. Grain-consuming animal units (GCAUs) are projected at 94.0 million this month, up slightly from last month's estimates due to an increase in projected broiler and turkey production that more than offsets lower beef production. The pork production forecast is unchanged from last month. The broiler production forecast is raised for the first half of the year based on January production data and stronger forecast prices. Beef production is lowered from last month. Steer and heifer slaughter is forecast lower but is partly offset by higher expected cow slaughter. Early year carcass weights are raised due to mild weather in much of the United States. Turkey production is forecast higher as higher prices are expected to encourage a more rapid expansion. Egg production is lowered slightly for 2012 as prices are forecast lower. Feed and residual use for the four feed grains plus wheat per animal unit is down slightly this month at 1.34 tons. This compares with 1.39 tons in 2010/11.
 

Forecast Oats Imports Raised 5 Million Bushels
 
There were no changes in U.S. corn, sorghum, or barley supply-and-use estimates this month. The strong pace of shipments from Canada is reflected in a 5-million bushel increase in U.S. oats imports. Oats use is unchanged and ending stocks are forecast 5 million bushels higher than last month.
 
The midpoint of the projected range for the 2011/12 corn price received by farmers is unchanged this month, but the range is narrowed by 10 cents on both the high and low ends to $5.90 and $6.50 per bushel. The projected range for the sorghum farm price is also narrowed by 10 cents on both the high and low ends to $5.80 and $6.40 per bushel. The high end of the barley price range was lowered 10 cents per bushel, resulting in a 5-cent decline in the midpoint to $5.35 per bushel. The lower end of the oats price range was increased 10 cents per bushel, resulting in an increase in the midpoint to $3.45 per bushel.
 

Ethanol Projection Unchanged
 
Projected U.S. corn use for fuel is unchanged this month at 5 billion bushels. Recent lower weekly ethanol production and higher stock levels, according to Energy Information Administration data, are consistent with last month’s projection. Current ethanol production has returned to levels close to those prior to last December's increase. The sluggish U.S. economy, high gasoline prices, and increased auto efficiency have reduced gasoline demand, lowering gasoline production. As ethanol blending nears practical limits at the 10-percent level (E10 blends), demand growth has slowed. Exports continue to play an important role in supporting domestic ethanol production; however, the E10 blend wall issue persists and prospects for long-term exports are uncertain. Currently tight sugarcane supplies in Brazil have curtailed ethanol production there and resulted in imports of U.S. corn-based ethanol. This situation has also enabled the United States to fill Brazil’s role as an ethanol supplier to the EU and other ethanol importers. As sugar prices decline, these markets may return to competitively priced Brazilian ethanol.
 

U.S. Corn Ending Stocks
 


March Planting Intentions and Stocks Report Are Keys to Price Prospects
 
Grain Stocks and Prospective Plantings are key reports that will be released by the USDA’s National Agricultural Statistics Service on March 30, 2012. The stocks report will show grain stocks as of March 1, 2012. Lower-than expected March 1 stocks would imply greater corn usage than expected in the quarter ending March 1 and would be bullish for prices. A higher-than-expected stock level could moderate prices somewhat. At the February 23-24, 2012, USDA Outlook Conference, corn plantings this spring were projected at 94 million acres. Prices will likely respond if planted acreage is substantially different than this projection. In the past 20 years, the March projection was below the final acreage estimate 8 times and above it 12 times.
 

U.S. Corn Exports
 


International Outlook
 
World Coarse Grain Production Prospects Increase
 
Global coarse grain production in 2011/12 is forecast up 1.5 million tons this month to 1,143.7 million. World corn production is up 0.9 million tons to a record 865.0 million. Barley, oats, rye, and mixed grain production prospects are virtually unchanged this month, but millet is up 1.5 million tons to 33.7 million, and sorghum is down 0.9 million tons to 59.8 million.
 
India reported revised production for harvests from the past monsoon season and reported planted area for some dry-season (mostly irrigated) crops. Millet production for 2011/12 is up 1.5 million tons to 12.5 million based on increased area estimated for both 2010/11 and 2011/12, as well as good yields again this year. The previous year’s millet production was revised up 0.7 million tons to 13.3 million. India’s corn area is also increased for both years and yields are raised for 2010/11, increasing production 0.5 million tons each year to 21.5 million tons for 2011/12 prospects and to 21.7 million for 2010/11. The same reports indicate lower sorghum area for both years but an increase in estimated yield for 2010/11 and reduced yield prospects for 2011/12. Sorghum production for 2010/11 is increased 0.3 million tons to 7.0 million, but 2011/12 is forecast down 0.7 million tons this month to 6.1 million.
 
Brazil’s corn production projected for 2011/12 is up 1.0 million tons this month to 62.0 million. Area is increased 0.3 million hectares to 15.3 million as prospects for second-crop corn plantings in Parana are supported by attractive prices. Average yield is reduced slightly as some first-crop corn has been damaged by above-normal temperatures and below-normal precipitation.
 
Argentina’s 2011/12 corn crop remains projected at 22.0 million tons as recent good rains have stabilized yield prospects, especially for late-planted corn. However, an analysis of 2010/11 supply and demand reveals corn production was larger than previously estimated, up 1.3 million tons this month to a record 23.8 million tons, based on increased area. Chile’s 2011/12 corn production is projected up 0.1 million tons to 1.6 million based on higher reported area and yield. There are small increases this month for corn production in Australia, Kyrgyzstan, and Azerbaijan.
 
Partly offsetting are reduced 2011/12 corn production prospects for South Africa and Ecuador. South Africa reports larger-than-expected corn area, as prices have been attractive, but spotty rains and above normal temperatures have cut yield prospects. Corn production is projected down 0.5 million tons to 12.0 million. For Ecuador, excessive rains have reduced both area and yield prospects, cutting production 0.3 million tons to 0.9 million. There is also a small reduction in corn production prospects for Uruguay.
 
For 2011/12 barley production prospects, a 0.1-million-ton reduction each for South Korea and China are offset by similar-sized increases for Azerbaijan and India. For sorghum, in addition to the India change, production prospects are reduced 0.2 million tons in Argentina to 4.2 million, with the effects of earlier drought reducing yield potential. There is also a small increase in sorghum production for Australia and a reduction for Uruguay.
 


Brazil's Corn Production and Yield
 


Global coarse grain beginning stocks forecast for 2011/12 are almost unchanged this month. World corn beginning stocks are up 0.2 million tons to 129.1 million, mostly due to an increase for Argentina caused by a significant increase in estimated 2010/11 production. Sorghum and millet beginning stocks for 2011/12 are up slightly due to increased 2010/11 production in India. However, global 2011/12 barley beginning stocks are down 0.3 million tons this month, mostly because of reduced 2010/11 production for China.
 
Increased World Coarse Grain Consumption Projected
 
Global coarse grain consumption in 2011/12 is projected up 2.2 million tons this month to 1,152.0 million, with feed and residual use up 1.9 million tons to 664.7 million. Corn total use is forecast up 1.9 million tons, with feed increased 1.4 million. World and India’s millet consumption is up 1.2 million, with feed increased 0.6 million. Global sorghum use is cut 0.5 million tons, nearly all food use in India. World barley use is down 0.6 million tons as reductions for Australia, China, and South Korea more than offset increased use forecast for Azerbaijan and Iran.
 
Corn use in the EU for 2011/12 is projected up 1.0 million tons to 65.9 million as corn is being priced competitively into feed rations compared to feed-quality wheat. EU wheat feeding is forecast down 1.0 million tons this month to 55.5 million. India’s corn feed use is projected up 0.4 million tons to 9.7 million, with increased corn production and dynamic demand for eggs and poultry meat. Corn feed use is forecast 0.1 million tons higher for Chile and Peru, with smaller increases for South Africa, Australia, and Kyrgyzstan. However, Malaysia’s corn feed use is reduced 0.3 million tons to 2.9 million because poultry production is relatively flat. Corn food, seed, and industrial use is forecast down 0.1 million tons each for India and the Philippines but increased slightly for Peru and South Africa.
 

Projected 2011/12 World Ending Stocks Reduced
 
Global coarse grain ending stocks for 2011/12 are projected down 0.6 million tons this month to 157.9 million, as increased forecast use exceeds the production increase. Corn stocks are forecast down 0.8 million tons to 124.5 million, sorghum is down 0.2 million to 4.2 million, oats are down 0.1 million tons to 3.5 million. Rye stocks are down slightly, but millet is up 0.4 million tons to 0.9 million and barley is up 0.2 million tons to 22.2 million.
 
EU corn ending stocks are reduced 0.5 million tons this month due to increased feed use. South Africa’s corn ending stocks are also cut 0.5 million tons and Ecuador’s stocks are trimmed 0.1 million mostly due to reduced production prospects. Peru’s expected corn ending stocks are reduced 0.1 million tons as reduced beginning stocks and strong use more than offset increased imports. Partly offsetting are increased corn stocks expected this month for Argentina, up 0.25 million tons, and for India, up 0.2 million, based on higher beginning stocks.
 
Sorghum 2011/12 ending stocks are reduced slightly this month for Sudan, with reduced beginning stocks on lower 2010/11 imports; for Australia, with increased exports; for India, due to lower production; and for Colombia, with lower beginning stocks. Oats stocks in Canada are trimmed by increased exports. Large millet production in India is boosting expected stocks. Most of the increased global barley stocks are in Iran, which is appears to be increasing imports to boost stocks.
 

Global 2011/12 Coarse Grain Trade Projected Higher
 
World 2011/12 coarse grain trade is forecast to reach 121.4 million tons, up 1.3 million this month. Corn trade accounts for about half the increase, up 0.7 million tons this month to 96.3 million, the highest in 4 years. Barley trade is up 0.4 million tons to 17.4 million, and oats trade is up 0.2 million to 2.2 million.
 
EU corn imports are increased 0.5 million tons to 4.5 million based on the pace of imports to date and import licenses for future imports. Developing dryness for winter crops in Spain may be contributing to the recent pace of corn import buying. Peru’s 2011/12 corn imports are increased 0.2 million tons to 1.8 million as revisions to 2010/11 imports and feed use indicate larger imports are needed to sustain poultry production. Ecuador’s imports are forecast up 0.1 million tons to 0.4 million, as imports replace a portion of reduced production. There is a small increase in corn imports by Ukraine based on trade data. However, Malaysia’s projected corn imports are reduced 0.2 million tons to 3.1 million as corn feed demand appears to be flat since 2009/10. Philippines corn import prospects are reduced 0.1 million tons this month as the pace of purchases has been sluggish and alternative supplies of feed-quality wheat are abundant.
 
Brazil’s 2011/12 (October-September) corn exports are increased 0.5 million tons to 9.5 million. With increased second-crop production, export prospects are enhanced as that is the crop that mostly receives government subsidies for transportation and arrives at ports when loading capacity is not being monopolized by soybeans. India’s corn exports are raised 0.2 million tons to 2.4 million based on the recent pace of shipments. Corn exports are projected up slightly for Australia and Malaysia but reduced for Ecuador.
 
U.S. corn exports are unchanged this month at 43.5 million tons. Based on Census shipments from October 2011 through January 2012, and February Inspections data, actual shipments to date exceed the previous year’s pace. However, as of March 1, 2012, outstanding export sales are down 20 percent, so U.S. corn exports in the second half of 2011/12 are projected to be significantly slower than a year ago.
 
Global barley trade is increased 0.4 million tons to 17.4 million. Based on recent reported purchases, Iran’s imports are increased 0.3 million tons to 0.7 million and China’s imports are up 0.2 million to 2.0 million. Australia, with ample domestic supplies of feed-quality wheat, is projected to feed less barley and export more, boosting exports 0.4 million tons to 4.0 million.
 
Oats trade is increased 0.2 million tons to 2.2 million. Based on the recent pace of shipments, Canada’s exports and U.S. imports are each raised 0.2 million tons.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 26, 2012, 11:40:33 PM

US Seed Supply Gets Boost from South America
26 March 2012



ANALYSIS - In October 2011, many US seed companies realized that, due to the record-setting summer heat during the day and night, there was a lack of pollination that caused target yields for seed corn to be about 75 per cent of expectations, writes Sarah Mikesell, senior editor.



Wyffels Hybrid production field in Chile.

Seed companies, depending on their carryover levels, chose to augment that production by going to South America to fill the 25 per cent deficit needed to avoid a 2012 shortage.

 Wyffels Hybrids, a US-based seed company, was like most seed companies in that same range of supply, but the difference was - they recognized what was occurring and how it would affect their overall supply about a month before their competitors.

"Wyffels recognized that yields could be less than anticipated and began our South American launch of product early on," said Bob Wyffels, vice president of production. "We have been producing seed corn in South America for 15 years and have strong relationships there, so we were able to aggressively line up growers and better fields and locations for our seed production acres. We were able to plant early, and today we are bringing back corn on a timely basis, likely earlier than others."



Bob Wyffels, VP of production for Wyffels Hybrid.

Mr. Wyffels said in South America the seed corn crop is planted in September; pollination occurs at the end of December. Harvest is usually in February or March, and seed comes back to the US about April 1. Those dates can all be adjusted by a few weeks depending on who the company is and how aggressive they move on it.

"Overall the seed production in Chile has been excellent this year. In fact, yields are above target, so they are exceptional yields," Mr. Wyffels said. "About 20 per cent of the seed corn supply will be coming from South America, so there was a temporary shortage but that is being filled right now. We expect to be very timely on our shipments to customers and are in a very good position compared to the rest of the industry."

South American Seed Quality, Yield
 
There is an equal opportunity to have as high of quality seed regardless of whether your seed was grown in South America or the US. In fact, there is a slightly greater chance of having greater purity in South America because in Chile many of the neighboring fields for isolation are grapes, pears, nectarines and blueberries, according to Mr. Wyffels.

"In the area where we produce, there is very little commercial corn grown," he said. "There are other high value crops. So from a genetic and trait purity scenario, it's very good."

If managed properly, yields can be equal or greater than in the US. In Chile, the light intensity is greater than even the US because it seldom rains in Chile, so you have 120 days of nothing but sunshine.

"It's all irrigated by the snow melt from the Andes Mountains through furrow irrigation," Mr. Wyffels said. "In the US, you don't think much about it, but you have sunny days, rainy days and cloudy days - many days where you don't have full light intensity. In Chile, it's 99 per cent sunny days, and the temperatures are more moderate than the US."



Wyffels Hybrid production field in Chile.

Transporting Seed to US
 
There are two ways to get the seed back to the US. Whenever possible, companies use an ocean-going vessel. However, if seed is being harvested during the latter part of the season and needs transported more quickly to accommodate an early planting date, companies can resort to air freight, meaning seed is put on a Boeing 747 or 767 and is flown to the US.

"Last week Wyffels had seed on 14 ocean-going vessels from South America headed to the United States," he said. "The seed ships into two major ports - Philadephia and Miami - where it goes through US customs. And then trains load it from containers to a van trailer, and it takes about two days to get it to our plant located in Illinois."

From the date of harvest in Chile until Wyffels delivers it on-farm to their customers is about 30 days.

Best Practice Puts Wyffels Ahead
 
Wyffels Hybrids' hands-on, in-field approach is a best management practice that gives them an advantage over competitors.

"We feel our aggressive approach to supply led us to act early and be in a great position," Mr. Wyffels said. "We know some of our seed was on the first vessel coming back, so we are able to get seed delivered to customers earlier. These are practices we've honed as an independent, entrepreneurial company."

He said three-fourths of the seed is already on-farm right now and within a few weeks, seed delivery will be complete.

"I think having the seed on-farm at this time puts farmers' minds to rest, and when you get this kind of heat wave, it makes growers antsy to get into their fields," Mr. Wyffels noted. "However, I am not a proponent of early planting. I'd advise growers to stay in their normal planting window."
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on March 28, 2012, 03:59:45 AM
Tuesday, March 27, 2012
CME: Grain Markets Await Plantings & Stocks Report
US - Grain markets are anxiously looking at the upcoming USDA reports on plantings and grain stocks, write Steve Meyer and Len Steiner.


Trade continues to simultaneously asses the amount of rationing that will be needed through the end of August and the supply of new corn that will come to market this fall. Corn futures have been trading in a narrow range as both bulls and bears have been unable to make a convincing case so far. That could change on Friday (reports are issued at 7.30 am Chicago time).

A survey of analysts conducted by Dow Jones indicated that on average they expect total plantings of 94.7 million acres, 2.8 million acres or 3% more than a year ago and higher than the 2012 USDA outlook forum estimate. There is a significant spread in the analyst projections, with some pegging total corn plantings to be well over 95 million acres. Excellent weather in many areas has encouraged some producers to get an early start, a somewhat risky proposition given the risks of an April freeze. Still, early planted corn offers significant rewards as it reduces the risk of a yield loss in late July and early August. It also allows farmers to bring their crop to market a little early and benefit from the price spread between old and new crop. July corn is currently priced at $6.42/bushel while Sep stands at $5.79 and Dec is $5.55. Early plantings also could pull more acres away from beans although this supply could be marginal.

We have included the last supply/demand corn table that showed the preliminary (and unofficial) USDA estimates for the upcoming corn crop. Based on 94 million planted acres, USDA projected ending corn stocks for 2011/12 at 1.6 billion bushels or 12% of use, a dramatic improvement over the current year that projects ending stocks at just 800 million bushels or 6.3% of use. An additional million acres of plantings could yield an extra 150 million bushels of production. Should this kind of volume materialize, it could push prices below the $5 threshold. But it is a big if and market participants remain unconvinced.

On the production side, there is no guarantee that an early planting window will boost yields, it just reduces the chance that yields will collapse. Short term drought conditions in Northwest Iowa and points north and west bears watching. The increase in corn acres comes at a price. Some of the acres will be corn on corn, which reduces yields. Also, more acres will come from marginal land, which again tends to negatively affect yields. Expecting 164 bushels per acre (USDA adjusted trend) could prove to be illusory. On the demand side, trade continues to struggle with projected export demand (China), livestock and poultry use (they can’t eat just DDGs, can they?) and the ethanol blend wall. In the short term, however, the corn market will remain focused on planted acres for the new crop while March stocks could help (or further confuse) where we stand with old crop supplies. Either way, it is shaping up as another interesting Friday.




Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 01, 2012, 09:47:45 AM

Report: U.S. farmers say they'll plant most corn acres since 1937
Purdue University Extension   |   Updated: March 31,2012

WEST LAFAYETTE, Ind. - U.S. grain farmers this spring intend to plant the nation's highest corn acreage since 1937, according to a U.S. Department of Agriculture report released Friday (March 30).

According to the Prospective Plantings Report by the National Agricultural Statistics Service, the nation's growers indicated they would plant 95.9 million acres of corn, up more than 4 percent, or nearly 4 million acres, from 2011.

They also expected to plant only 73.9 million acres of soybeans, down 1.4 percent, or more than 1 million acres, from 2011.

The projections are based on an early March survey of growers nationwide.

"It's obviously important to see where producers are at right here at the beginning of the planting season," said Chris Hurt, Purdue Extension agricultural economist. "They are saying they're going to be very heavy in corn planting here in the Midwest, so overall, there are big numbers on corn acreage but low acreage intentions on soybeans."

In Indiana, producers said they would increase corn acres by 200,000 acres but reduce soybean acreage by the same amount. Ohio growers said they would increase corn acres even more substantially with a 400,000-acre jump. Growers expected Ohio soybean acres to stay the same.

"The increase in Indiana corn acreage is going to come entirely out of soybean acreage," said Corinne Alexander, Purdue Extension agricultural economist. "Ohio's soybean acres are flat, so the largest portion of that corn acreage increase is going to come from a reduction in wheat acres. What doesn't come from wheat acres, we expect largely to come from 2011's prevented planting acres and from conservation land."

In addition to the plantings report, USDA-NASS also released its March Grain Stocks report. The report shows the availability of grain stocks in the U.S. as of March 1.

The U.S. has about 6 billion bushels of corn stocks, about 140 million bushels lower than what trade markets expected, according to the report. Soybean stocks came in at 1.372 billion bushels, up 11 million bushels from expectations.

"It's no surprise to anyone that these numbers are down substantially from where they were a year ago," Alexander said. "Where the surprises come in is that they're down even more than expected. Because of the difference, we're expecting this to be pretty bullish for old crop corn prices. The report is pretty neutral on soybeans because the trade had pretty good estimates of what the stocks report would say."

But even with soybean stocks slightly better than expected, prices have been on the rise. And with the influx of a lot of new crop corn on the horizon, Hurt said growers might want to reconsider their planting intentions.

"As we look at the implications of these reports, I think one of the clear ones is that the very large corn acreage will depress new crop corn prices, but the low soybean acreage will be overall increasing to new crop prices of beans," he said. "The market now, in the next several days or weeks, is going to try to still buy more bean acres. So I think producers should rethink that corn and soybean mix, or at least redo their calculations and put beans a little bit higher in their priorities this year."

According to Hurt, soybean futures prices as of March 29 were about $25 per acre more profitable than corn.

Hurt and Alexander estimated that with an average 2012 crop yield, the national average corn price could be about $5.25 per bushel and beans about $11.75. In that case, Midwest farmers would see the highest soybean revenues and second-highest corn revenues in history.

But the high revenues don't tell the whole story. The cost of producing those crops is up an estimated 15-20 percent this year, so the total returns actually will be down somewhat from 2011.
"The returns are coming down, but they're coming down from record-high levels," Hurt said.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 04, 2012, 08:34:39 AM
Tuesday, April 03, 2012
Winter Precipitation and Corn Yield
US - Due to the very warm temperatures in the winter of 2011-12, we recently examined the relationship between average winter temperatures and average temperatures the following summer and the relationship between average winter temperatures and corn yield, write Scott Irwin and Darrel Good.


We showed that the correlation between average winter temperature and both average summer temperature and average state yield is small for Illinois and Iowa. Here we extend the analysis to the relationship between total state average precipitation during December, January, and February and the total precipitation in the following July and August. In addition, we examine the relationship between the total winter precipitation and the trend-adjusted corn yield the following year.Once again, the analysis is conducted for Illinois and Iowa (the two largest corn producing states) over the period 1960 through 2011.

The relationship between total winter and summer precipitation is presented in Figures 1 and 2. The correlations indicate a slight negative relationship between winter and summer precipitation in Illinois and virtually no relationship in Iowa (correlations can vary between -1 and +1, with zero indicating no relationship). The weakness of the relationships is most evident in the wide scatter of data points around each line. Winters with above- and below-average precipitation are associated with a wide range of precipitation the following summer.

 


Given the slight relationship between winter and summer precipitation in Illinois and Iowa, it would not be surprising to find little relationship between winter precipitation and the state average trend-adjusted corn yield the following year. That expectation is confirmed by Figures 3 and 4, which actually show a small negative relationship between average winter precipitation and trend-adjusted average state yield. Nonetheless, in contrast to winter temperatures, there is a logical reason to think that winter precipitation should actually be positively related to corn yields. Specifically, winter precipitation contributes to the preseason charging of soil moisture reserves, which ultimately contributes to higher yields. If one excludes several outliers from the plots (1983, 1988, and 1993) there is indeed a small positive relationship between winter precipitation and corn yield in both states. This is what we found in our previous modeling work on corn yields with the use of a more complete model specification. It is, of course, important to keep in mind that the impact of precipitation before the growing season is small compared to precipitation during the growing season. The yield impact of moving from the minimum to the maximum winter precipitation observed over 1960-2012 in both states is at most 5 bushels per acre.

 


Conclusion
There is little correlation between winter weather (temperature or precipitation) and summer weather. This is consistent with the view that, beyond seasonal tendencies, weather is very difficult to predict over time horizons longer than a few weeks. There may be some predictability over longer horizons due to so-called ENSO events (e.g., El Nino and La Nina), but the reliability of such patterns for predicting U.S. Corn Belt growing season conditions is still open to considerable debate.

In contrast to winter temperature, winter precipitation is likely to have a small impact on corn yields in the following growing season. The available data indicate December, January, and February precipitation in Illinois (6.8 inches) was near average and in Iowa (4.3 inches) above average. Preliminary data indicates March was drier than average. On balance, this suggests little impact of winter 2012 precipitation relative to trend yield in either state.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 06, 2012, 09:21:54 AM

Corn, Rice & Wheat Imports to Continue to Meet Food Demand
05 April 2012



VENEZUELA - Venezuela is expected to continue importing significant amounts of yellow corn, rice and wheat to meet domestic food demand and requirements of the animal feed industry and to offset decreasing domestic grain production.

During the last ten years, Venezuela has increasingly turned to imports to meet its demand for food. According to the FAO figures, Venezuela imports more than 70 per cent of its food supply.
 
For grains, all the yellow corn used by the animal feed industry and almost all the wheat is imported and it is now importing about 40 per cent of its rice demand. Two years ago Venezuela began importing white corn (a product that is part of the basic diet of Venezuelans) for the first time since 1997.
 
Misguided agricultural policies were exacerbated by bad weather conditions (particularly the devastating rains of December 2010) that drastically decreased the country’s corn and sorghum production of 2011/2012. Rice production has been recovering after two years of poor harvests but imports will still be needed.
 
The Bolivarian Government of Venezuela (BGV) publically states that food production is in the national interest and is fundamental to the economic and social development of the Nation.
 
In January 2011, the BGV launched “Mission Agro-Venezuela”, which has three main goals: increase production of staple crops, increase the amount of land under production, and promote and stimulate urban agriculture.
 
The programme will provide low-interest loans, machinery, and technical assistance to farmers all over the country. A fund of one billion bolivars ($232 million) has been assigned. The government aims to cut food and agricultural imports by 30 per cent in the first year of Mission Agro-Venezuela.
 
Despite these plans to increase domestic production of feed and food, the gap between supply and demand is expected to remain large, and significant imports of basic feed and food grains will be needed to maintain consumption in the coming year and beyond. Post expects imports to continue strong, based on domestic food demand and the need for more feedstuffs by the expanding poultry and pork sectors.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 12, 2012, 08:14:56 AM

Oilseed Production Forecast is Up Eight Per Cent
11 April 2012



PAKISTAN - MY 2012/13 oilseed production is forecast at a record 5.8 MMT, up eight per cent from the estimated 5.7 MMT harvested in MY 2011/12.

Pakistan is a net importer of oilseeds and edible oils. Domestic production of edible oils is sufficient to meet only about 27 per cent of total demand. Domestic oilseed production includes cotton seed, sunflower seed and rapeseed.
 
MY 2012/13 oilseed production is forecast at 5.8 MMT, eight per cent higher than the revised estimate of 5.4 MMT harvested in MY 2011/12. Cottonseed regularly accounts for about 82 per cent of Pakistan’s total oilseeds production.
 
Imports of oilseeds are forecast at 1.0 MMT (80 per cent rapeseed/ canola and 19 per cent sunflower seed). Total supply of oilseed available for crushing in MY 2012/13 is forecasted at 6.2 MMT, eight per cent higher than the estimates of MY 2011/12.
 
MY 2012/13 domestic meal production is forecast at 3.0 MMT, up eight per cent from current year’s level of 2.7 MMT. MY 2012/13 imports of soybean meal are forecast at 350,000 tons, 17 per cent higher than MY 2011/12 imports.
 
Virtually all of Pakistan’s soy meal imports are sourced from India.

MY 2012/13 oil production is forecast at 1.5 MMT, eight per cent higher than current year’s estimate. Vegetable oil imports are forecast at a record 2.3 MMT, an increase of four per cent relative to MY2011/12. Palm oil accounts for 98 per cent of the total edible oil imports.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 18, 2012, 10:00:09 AM
Tuesday, April 17, 2012
Has the 2011 Corn Crop Been Rationed?
US - Corn prices declined substantially over the past week. May and December 2012 futures have declined by $.26 and $.22, respectively, following the release of the USDA’s WASDE report on 10 April, writes Darrel Good.


Recent weakness in old crop prices started with the USDA’s unchanged forecast of year-ending stocks of 801 million bushels. Following the smaller-than-expected estimate of 1 March stocks revealed on 30 March, the market had anticipated that the April WASDE report would contain a larger forecast of feed and residual use and a smaller forecast of ending stocks. Additional price weakness has been attributed to weakness in the financial markets associated with a slowdown in the Chinese economy and concerns about the Spanish debt as well as prospects for increased corn acreage in China. New crop prices continue to reflect the larger-than-expected planting intentions revealed on 30 March, an early start to the planting season, and the recent improvement in soil moisture conditions in a large part of the Corn Belt.

With prospects for relatively small ending stocks, it is important to continue to monitor the rate of corn consumption to confirm that the necessary rationing is occurring. In the Feed Outlook report released on 12 April, the USDA estimated feed and residual use of corn during the first half of the marketing year at 3.39 billion bushels, 238 million less than during the same period last year. The entire decline was in the first quarter of the year. Use in the first half of the year represents 73.7 per cent of the projected use of 4.6 billion bushels for the year. That per centage is large by historic standards, but less than the very unusual 75.7 per cent of a year ago. To reach the projection for the year, use during the last half of the year needs to be 46 million bushels larger than that of a year ago. On the surface, a year-over-year increase in feed and residual use from March through August seems unlikely given the reduction in broiler production that is occurring, expectations for fewer cattle on feed this summer, expectations of increased wheat feeding this summer, and perhaps a bit more August harvested corn in the South. However, estimated feed and residual use of corn was unusually small during the last half of the 2010-11 marketing year. Many continue to believe that use was underestimated during that period due to an overestimate of 1 September 2011 stocks. Considerable uncertainty about the on-going rate of feed and residual use will continue until the 1 June stocks estimate is released on 30 June.

The USDA also maintained the projection of marketing year corn exports at 1.7 billion bushels. That forecast is 135 million bushels, or 6.7 per cent less than exports of a year ago. Through 5 April, cumulative export inspections, adjusted by Census Bureau export estimates through February this year and March last year, were 6.9 per cent less than the total of a year ago. To reach the USDA projection, exports during the last 21 weeks of the year need to total 703 million bushels. As of 5 April, the USDA reported unshipped export sales of 408 million bushels. New sales need to average about 14 million bushels per week in order for sales to reach 1.7 billion bushels. For the 5 weeks ended 5 April, new sales average 29.9 million bushels per week. It appears that sales are on track to reach, or slightly exceed, the USDA projection. The rate of shipments, however, needs to increase by about 5 million bushels per week from the most recent 5-week average pace of about 28.2 million bushels.

The use of corn for ethanol and co-product production during the current year is forecast by the USDA at 5 billion bushels, 21 million less than used last year. Use during the first half of the year was estimated to be 81 million larger than use of a year ago. To reach the projection for the year, use during the last half of the year needs to be 4.1 per cent less than that of a year ago. For the 5 week period ended on 6 April 2012, ethanol production was estimated to be 1.5 per cent less than in the same period last year. While the pace of ethanol production has slowed, it is above that needed to reach the projected level of corn use for the year.

While futures prices have decline over the past week, basis levels remain generally strong and the May/July futures inversion has increased. These relationships suggest on-going tightness in stocks and/or a slow rate of movement relative to the pace of consumption. While evidence about the pace of consumption is mixed, expect corn prices to remain under pressure until there is convincing evidence that the necessary rationing has not occurred or concerns about 2012 production develop.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 19, 2012, 07:30:18 AM
Wednesday, April 18, 2012
CME: Corn Plantings off to a Strong Start
US - With spring weather (some would say summer weather) across the Midwest, crop plantings are off to a strong start, write Steve Meyer and Len Steiner.


But as the chart below shows, even with all the news stories of early plantings, today we are still near the levels we saw back in 2010. USDA reported that for week ending April 15, US farmers had planted about 17% of the corn crop. This compares to 5% planted for the same period last year and 5% for the five year average 2007-11. Trade reports indicate that market participants were anticipating plantings to be somewhere between 17— 20% so the survey results will likely could be construed as neutral to maybe slightly bullish by futures markets. Market participants in the grain complex will be following closely the day to day changes in weather and the impact this could have on both field work as well as on the crop that was planted much earlier than normal and could be subjected to any late freezes. Much of the advanced plantings has taken place in the Eastern Corn Belt (ECB). Illinois plantings currently stand at 41%, compared to just 8% a year ago and 6% for the five year average. Indiana plantings are at 24% compared to a mere 2% last week. Western Corn Belt plantings, which includes big corn producing states such as Iowa, are not as far along. Iowa plantings are currently pegged at just 5% compared to 1% last year and 3% for the five year average.

For livestock producers, the early start of field work and lack of any weather pressures to this point certainly are good news. Also positive from a livestock producer point of view is the good progress in the wheat complex, which should bring more wheat into the feed complex later this summer. For the last two weeks we have been hearing about the great shape of the wheat crop and the fact that the crop was heading much earlier than normal. The latest USDA report appears to support the anecdotal reports. For the week ending April 15, 29% of the US winter wheat crop was reported to be heading. This compares to 11% last year and just 8% for the five year average. This is tremendous progress which could bring a wheat crop to market much earlier than before and could help boost supplies IF there is no weather event in the next few weeks. A crop that is heading this early is vulnerable to a late April freeze but should this not occur, the chances of a bigger than expected supply become more realistic. At this point, the market is pegging new crop corn at a $5.30/bushel for December. The debate in the trade is whether the market has properly accounted for the risk of weather disruptions or if the fact that extra long positions among both producers and funds makes the market vulnerable to a downward correction should weather continue to be a non-event. At this point, the crop progress is welcome news for livestock producers but there is plenty that can happen between now and July that could affect the crop. USDA will issue its first official forecast of the corn crop on May 10., a forecast that will likely account both for the early plantings, the expanded acres and a baseline yield, likely doubling ending stocks of 2011/12.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on April 20, 2012, 09:34:43 AM
Thursday, April 19, 2012
Import Restrictions on Soy Would Affect Farmers
SPAIN - The Spanish government is discussing whether or not it should impose import restrictions on Argentinian products, including soybeans, in retaliation to an announcement by the Argentinian government that it will nationalise oil company, YPF.


Buenos Aires has put forward a bill that would allow it to take a controlling stake in YPF, a company owned by the Spanish energy giant, Repsol.

Soybeans and ethanol are two of the products that the Spanish government is looking at placing import restrictions on.

Spain imports between three to four million tonnes of soy a year, of which 85 per cent comes from Argentina.

Agricultural organisation, ASAJA of Castile and Leon has said that it will support the Government if they pursue the right to impose severe restrictions on imports of food products from Argentina. However, the group warned that Spain depends heavily upon soybeans and other protein products for animal feed, and therefore may have to seek other markets.

With the Spanish livestock sector currently suffering from poor profitability, high producers costs and drought, any action that pushes up the costs of production for producers should be prevented, ASAJA said.

The Union of Small Farmers and Ranchers (UPA) has said prohibiting exports of Argentinian soybeans could have serious negative effects on the livestock industry.

UPA has said that it will be difficult to find alternative sources of soy.

The organisation has urged the European Union and its Member States to consider the "irresponsible attitude" of Argentina in this case and rethink their positions ahead of the negotiation of trade agreements with Mercosur. Farmers and ranchers are adversely affected by such agreements, which tend to prioritise the interests of other sectors against the producers of food and raw materials.

UPA warned that if imports of soy were to be stopped, there would be a serious shortage, which would push prices up to unbearable levels for producers. It highlighted that the drought had made producers even more dependent on feed as grass growth was minimal.

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 01, 2012, 09:32:26 AM
Monday, April 30, 2012
CME: Corn Futures Higher as China Purchases Corn
US - US nearby corn futures were sharply higher on Friday as market participants reacted to news that China purchased 1.472 million metric ton of corn (58 mil. bu.), write Steve Meyer and Len Steiner.


This was one of the biggest one time corn purchases on record to this market and it reignited speculation that old corn crop stocks are very tight and may need some rationing until the new crop starts flowing in. The fact that the new crop has been planted relatively early in the ECB should provide some notable supplies before the end of August (official end of marketing year) and yet grain markets remain concerned about the effect some cooler weather on corn breaking above ground. But back to the China story, there has been plenty of speculation in recent months as to how big a buyer of US corn China will be in the coming years.

Not very long ago, China was a net exporter of corn to a number of Asian destinations, benefiting both from a freight advantage and lower costs. However, feed demand in China has been outpacing supply increases. In 2009/10 marketing year, China produced 163.97 MMT (~6.463 bil. Bu) of corn and imported about 1.3 MMT. In marketing year 2011/12, China corn production is forecast to increase by almost 28 MMT or 17% and yet China is forecast to import 4 MMT. The increase in Chinese feed demand has tightened feed availability for a number of Asian markets that traditionally imported corn from China. And as China now accounts for 1 out of 5 bushels of corn produced in the world, the market is now vulnerable to weather events in that part of the world more so than at any other time on record.

US cow and bull slaughter continues to run well below year ago levels. While much of the attention recently has been on packers slowing down slaughter in an effort to prop up prices ahead of Memorial Day needs, the slowdown in the cow and bull slaughter is more a reflection of the fundamentals in the beef market, improving feed conditions compared to a year ago and strong feeder cattle prices out front have changed the incentives for cow-calf producers. Indeed, US cow slaughter would be down even more had it not been for the sharp pullback in milk values, which are now pushing more dairy cows to market.

The weekly cow slaughter data, which are published with a two week lag, showed that for the last four reported weeks (Mar 18 - Apr 14), total US cow slaughter was 457,400 head, 5.5% lower than a year ago. During that period, beef cow slaughter was 210,600 head, 17.6% lower than a year ago while dairy cow slaughter was 246,800 head, 7.9% higher than a year ago. Dairy cow slaughter currently makes up about 54% of the overall US cow slaughter, the highest such proportion in more than 20 years. It is still early to proclaim a full rebuilding year as pasture conditions in a number of key states remain tenuous. A sharp deterioration in weather conditions could quickly impact beef cow slaughter. As for the dairy industry, increased productivity, higher cow number and, even more critically, slowing domestic and export demand, will likely cause producers to increase the pace of diary herd liquidation, but this time with no government money

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 11, 2012, 07:45:24 AM
Tuesday, May 08, 2012
Brazil's Soybean, Corn Feed Prices Head Higher
ANALYSIS - Informa Economics FNP said severe weather and crop failures in south Brazil and increased consumption demand are driving up corn (maize) and soybean meal costs, putting pig and poultry farmers on alert, writes Sarah Mikesell, senior editor.

Ariovaldo Zani, executive VP of Brazil’s National Animal Feed Industry Association, Sindirações, said feed production this year will increase by 3.0 to 3.5 per cent. Feed costs account for about 60 per cent of Brazilian pig and poultry producers’ total production cost.

“The Brazilian animal feed industry depends on the food industry which, in turn, is modulated by domestic and international consumer demand,” Brazil’s National Animal Feed Industry Association said in a statement.

Soybean meal and corn account for about 80 per cent of the feed consumed by poultry and pigs in Brazil.

According to the Association, last year, 66 million tons of feed were produced, with 37.8 million tons going to poultry farms and 15.4 million tons going to pig farms. On poultry farms, 61 per cent of the feed is made up of corn and 25 per cent soybean meal, while pig feed is made up of 68 per cent corn and 16 per cent is soybean meal.

Brazil’s Corn, Soybean Markets
Informa Economics FNP believes the area planted with summer corn and soybeans for 2011/12 was up by 5.3 per cent year on year but because of the serious drought in south Brazil, production will be down about eight per cent versus the previous season. The US Department of Agriculture (USDA) has estimated an 11 per cent soybean production reduction in southern Brazil due in large part to the La Niña weather phenomenon.

For corn, the average productivity in the southern region will be much lower than last season and even less than the average of the last 10 years which will increase the dependence on the winter corn crop, said Aedson Pereira, Information Economics FNP analyst.

Winter corn areas are expected to increase but it is too early to predict if that will equate into larger production. Zani expects winter corn can make up the difference and anticipates no issues.

Brazil’s summer production will be 36 million tons in the 2011/2012 harvest, which is up 0.2 per cent over year ago, said Informa Economics FNP. This slight bump in production was the result of other regions of Brazil significantly increasing production levels.

“The numbers give the impression that competition for corn will be strong this year,” said Pereira. “The most optimistic scenario at Informa Economics FNP indicated production of 298 million tons on an area of 6.8 million hectares.”

Growth Opportunity
Expansion of soybean area in the Center–West and Northeast regions has been occurring at a very fast pace on the heels of high commodity prices and mainly through land lease contracts of abandoned farms and/or degraded pasture–lands, says the USDA GAIN report.

Possessing 20 per cent of the planet’s fresh water, Brazil also has tremendous potential to expand planted area via irrigation projects that make possible second and third crops rotated over a yearly growing season. Recent historically high crop prices have greatly improved the time–frame for return on investment with the main constraints being water use licences and capital investment requirements.

Large irrigation project investments are increasing soybean planted area and are made possible through rotating cash crop production – wheat, edible bean, cotton – based on the market’s current highest returns.

Exports Down; Recovery Expected in 2012/2013
Soybean exports in marketing year 2011/12 are estimated at 29mmt, down 14 per cent from the 2010/11 record of 33.8mmt. Over the last few months, current high prices and favorable exchange rate have directed Brazilian soybeans to the export market as opposed to the domestic crush market, according to USDA.

However, USDA expects the market to turn inward to supply crush in the second semester of 2012 as a return to traditional export windows to third markets based on price competitiveness at harvest between the US and Brazil occurs. Also, export logistics and port capacities will be strained the second half of 2011 as soybeans compete with sugar, corn, and other export crops.

These expectations together with a drought-reduced short crop will reduce Brazil’s export market share in 2011/12. That said, USDA forecasts a recovery in Brazil’s export market presence in 2012/13 reaching a new record of 35mmt based on continued strong global demand.

International Market
Competition between the domestic and international markets will be aggressive come mid-September when the US harvest is underway. Two years in a row of moderate to poor production have limited the global corn and soybean supply.

La Niñ has also had a significant impact on the Argentina corn and soybean harvests in 2011 and 2012. Despite being the third largest global soybean exporter, Argentina’s international market share slipped the last few years, contributing to the increase in international commodity prices.

Argentina’s soybean production is also slipping. In 2009/2010, it was reported at 54.5 million tons but FNP expects it to only reach 45 million tons in the current season. Corn is following a similar course, falling from 23.3 million tons harvested in 2010 to 20.5 million tons this season. Argentina’s corn exports have also seen a dip from 16.5 million tons in 2010 to 13.5 million this year.

US production was also down last year, due mostly to an exceptional wet spring in the eastern half of the Midwest followed by extreme summer heat during the critical tasseling period. This year could be brighter though, as weather has cooperated so far and US growers have been able to get crops in the ground earlier than usual.

China continues to support the demand side with major purchases of soybeans and has resumed its corn imports due to a decrease in local production. China remains the largest world consumer of corn, feeding huge numbers of poultry and pigs.

According to Informa Economics FNP, Brazilian agribusiness has increased sales to China buy three per cent while Brazil‘s export revenue to China has increase by 17.5 per cent.


Sarah Mikesell, Senior Editor
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 12, 2012, 10:14:34 AM
Friday, May 11, 2012
CME: Farmers to Harvest Record Corn Crop
US - According to the latest USDA supply/demand update, US farmers this fall will harvest the largest corn crop on record, write Steve Meyer and Len Steiner.


Between a 6.1 per cent increase in harvested acres (5.1 million acres more than a year ago) and a 12.8 per cent increase in expected yields (18.8 bu./acre higher than in 2011), US corn production for the 2012/13 marketing year is now pegged at a record 14.790 billion bushels. This is 2.432 billion bushels or 20 per cent larger than a year ago and about 1.75 billion bushels larger than the previous record year output in 2009/10.

USDA was quite aggressive in its estimates for the new corn crop but its data follows established methodology whereby USDA analysts account for crop progress so far this year and adjust their trend yields accordingly. With planting progress well ahead of schedule so far this year and weather forecasts indicating that the La Nina weather pattern is coming to an end, USDA now expects above trend yields this coming fall. Some analysts continue to wonder how realistic this assumption is.

The sharp expansion in corn plantings has brought more marginal and lower yielding acres into the mix. While US farmers have approached current yield estimates in the past, indeed yields were 165 bu./acre in 2009/10, that yield was from planting 86.4 million acres, compared to 95.9 million acres this year. It would appear to us that for current yield estimates to materialize, a lot of things need to be just right for this year’s corn crop. So far things are shaping up well but Mother Nature still holds all the cards.


One surprising twist in the supply and demand table was that USDA also increased projected ending stocks for old crop corn. This ran counter most analysts estimates who were expecting old crop ending stocks at around 750 million bushels, compared to the 851 million bushels that USDA reported. USDA reduced feed consumption estimates for this summer as more wheat is currently going into livestock and poultry feed.

USDA also did not change its estimates for US corn exports despite much talk in the trade of large shipment to China and other destinations. Demand estimates for the new crop were equally interesting and different from what private analysts were contemplating ahead of the report. USDA sharply increased US corn feeding estimates in the new crop year, projecting feed and residual use at 5.450 billion bushels, about 900 million bushels or 13.7 per cent higher than a year ago. This feeding level would imply a notable decline in wheat feeding, as corn / wheat spreads widen and also expansion in livestock and poultry numbers.

With the calf crop declining in the next year, cattle feed demand will remain limited, and likely will contract. Some hog expansion is expected but, based on current farrowing estimates into year end, it is unlikely we will see more than a 1 per cent increase in hog numbers at least through Q1 of next year. Maybe the broiler industry will make a sharp U-turn and expand rapidly. There are some indications that broiler supplies will recover by Q4. Lower corn prices certainly are an inducement but keep in mind that for poultry producers, soybean meal prices are very important, accounting for as much as 30 per cent of the broiler ration.

Soybean meal prices have increased sharply in recent weeks and are expected to stay high into next year as well. But even as some analysts think the feed estimates overstate the case for demand next year, they also believe the current USDA export estimate may be on the low side, especially if Chinese producers fail to produce another record crop. A potential increase in exports could offset lower feed numbers. USDA now expects the stocks/use ratio to double in 2012-13, pushing prices in the $4.5/area.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on May 31, 2012, 07:12:36 AM

Season for Determining Corn Yields is Underway
30 May 2012


US - The 2012 US average corn yield will be one of the dominant factors in determining the level of corn prices over the next year. Expectations about that yield have started at a pretty high level, but the critical period for yield determination is really just beginning, writes Darrel Good.

What do we know about yield potential as the summer growing season begins? The most important development to date is the generally timely planting of the crop. There is a relatively wide window of planting dates for maximum corn yield potential, with yield penalties associated with late planting. Since corn planting dates vary considerably by geographic area, corn planting occurs over a period of several weeks, and corn planting has been occurring earlier over time, there may be a number of ways to characterize timeliness of planting on a national basis. For the period beginning in 1986, we have defined late planting as the per centage of the crop planted after 20 May in the major corn producing states included in the USDA's Crop Progress report.
 
This year, only four per cent of the corn crop in the 18 major corn producing states was planted after 20 May. That is the smallest per centage of the crop planted late during the 27 year period since 1986. On average, 18 per cent of the crop was planted after May 20 from 1986 through 2011. There were 9 other years when less than 10 per cent of the crop was planted after 20 May. In those 9 years, the US average yield was within two bushels of the trend yield in 5 years. Large deviations from trend yield occurred in the early-planted years of 1987 (+ 8 bushels), 1988 (-29 bushels), and 1992 (+16.8 bushels). These yield results are not especially informative for forming expectations about the average yield in 2012. Planting date may be important for yield potential with everything else equal, but summer weather conditions ultimately determine the level of yields. The small per centage of the crop planted late this year suggests that the US average yield will be higher than if a normal per centage had been planted late, but the level of yields is still to be determined.

A second piece of early information relative to corn yield potential is the crop condition rating provided in the USDA's weekly Crop Progress report. Historically, there has been a positive relationship between the per centage of the crop rated good or excellent at the end of the season and the US average yield relative to trend. Early crop condition ratings are suggestive of yield potential, but ratings can and do change substantially by the end of the season. The first crop condition rating of the season this year showed that 77 per cent of the crop was in good or excellent condition as of May 20. Since 1986, an average of only 66 per cent of the crop was rated in good or excellent condition in the first report of the season. There were only 6 other years when the initial ratings showed 75 per cent or more of the crop in good or excellent condition. The rating at the end of the season was higher than the initial rating in two of those years (1987 and 1994) and the US average yield was well above trend in both years. The rating at the end of the season was below the initial rating in 4 of the 6 years. The average yield was near trend value in three of those years when the final ratings showed 60 to 69 per cent of the crop in good or excellent condition. The US average yield was well below trend in 1991 when the final rating showed 53 per cent in good or excellent condition.
 
A small per centage of the crop planted late this year and the early condition of the crop point to the potential for an above-trend yield in 2012, but the most important part of the season is just beginning. The corn market will continue to follow weather developments and crop condition ratings in order to refine yield expectations. At this juncture two important developments may be required in order to maintain high yield expectations. The first is some convincing evidence that the relatively long period (8 months or so) of above average temperatures is giving way to normal or below normal temperatures. The second is for soil moisture deficits in important areas of the central, eastern, and southern Corn Belt to be eliminated.
 
In addition to yield prospects, the expected size of the 2012 crop will be impacted by the magnitude of planted and harvested acreage. The USDA will provide survey-based estimates in the Acreage report to be released on 29 June. New crop corn prices are expected to remain under pressure as long as large crop expectations prevail.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 13, 2012, 08:35:58 AM

Update on Export Progress
12 June 2012


US - Much of the attention in the crop markets is rightly focused on the potential size of the northern hemisphere crops. Still, the on-going pace of consumption is an important measure of demand strength and the likely level of year ending stocks. Here we focus on the US export sector for wheat, corn, and soybeans, writes Darrel Good.

For wheat, the 2011-12 marketing year ended on May 31. Cumulative export inspections for the year totaled 1.036 billion bushels, slightly above last month's USDA projection of 1.025 billion bushels. Through April, cumulative Census Bureau export estimates were about 4 million bushels less than cumulative inspections. Assuming that margin persisted through May, marketing year exports were about 7 million bushels larger than forecast. For the marketing year that began on 1 June, the USDA has projected exports at 1.150 billion bushels. As of 31 May, new sales plus unshipped sales from the past marketing year totaled 235.6 million bushels, near the level of sales of a year earlier. To reach the USDA projection, shipments will need to average about 22.1 million bushels per week this year. Export inspections during the first week of the year were reported at 21.5 million bushels.
 
For corn and soybeans, the final quarter of the 2011-12 marketing year began on 1 June. Cumulative corn export inspections during the first three quarters of the year totaled 1.221 billion bushels. Through April, cumulative Census Bureau export estimates exceeded inspections by 23 million bushels. Assuming that margin persisted through May, exports during the first three quarters totaled 1.244 billion bushels, 122 million less than during the same period last year. The USDA currently forecasts marketing year exports at 1.7 billion bushels. Exports during the final quarter of the year will need to total 456 million bushels, or 34.7 million bushels per week, to reach the projection. Inspections averaged only 26.3 million bushels during the 6 weeks ended 7 June, and dropped to a marketing year low of 17 million bushels in the latest reporting week. Unshipped sales as of May 31 were reported at 304 million bushels, 87 million less than on the same date last year. For sales to reach 1.7 billion bushels, new sales will need to average 11.5 million bushels per week. The average sales pace for the 5 weeks ended May 31 was 7.4 million bushels. Export commitments to date are much larger than those of a year ago for China and Mexico, but down sharply for Japan, Taiwan, and South Korea. It now appears that exports for the year will be 75 to 80 million bushels less than projected as US corn has lost market share to feed wheat. The USDA will update the projection on 12 June.
 
Cumulative export inspections of soybeans totaled 1.164 billion bushels during the first three quarters of the 2011-12 marketing year. Through April, cumulative Census Bureau export estimates were about 6 million bushels less than inspections. If that margin persisted through May, exports totaled about 1.158 billion bushels, 237 million less than in the first three quarters last year. For the year, USDA has projected exports at 1.315 billion bushels. To reach that projection exports during the final quarter will need to total 157 million bushels, or an average of 11.9 bushels per week. Inspections during the 6 weeks ended June 7 averaged 14.9 million per week. Unshipped sales as of May 31 totaled 192 million bushels, compared to 154 million on the same date last year. It now appears that marketing year exports could exceed the USDA projection (to be updated on June 12) by as much as 25 million bushels as the U.S benefits from the shortfall in South American production. China continues to be the major purchaser of US soybeans (62 per cent to date) and has already made large purchases for delivery during the 2012-13 marketing year.
 
It appears that corn exports will come up well short of 1.7 billion bushels, pointing to larger year-ending stocks than currently projected. Some of the shortfall in exports may be made up by slightly larger consumption for ethanol production as ethanol production during the first three quarters of the year was about two per cent larger than production a year earlier. The big unknown, however, is the magnitude of feed and residual use of corn during the last half of the year. Quarterly use in that category has been difficult to anticipate over the past two years. The 1 June corn stocks estimate, along with the level of wheat prices, and the pace of maturity of the 2012 corn crop will shed more light on use in that category.
 
While month-end acreage and stocks reports will be important for crop prices, prices will continue to be heavily influenced by 2012 yield prospects. To date, the corn market has displayed relatively little concern about the cumulative and upcoming moisture deficits in large areas of the central, eastern, and southern growing areas.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on June 28, 2012, 09:47:52 AM

Soybean Fundamentals Remain Strong
26 June 2012


US - US soybean market fundamentals have been strong for an extended period of time, says University of Illinois agricultural economist Darrel Good.

"The strong fundamental factors have included record large exports in 2009-10 and 2010-11 as Chinese demand expanded, a reduction in US soybean acreage in 2011, a relatively low US average yield in 2011, intentions to reduce US acreage again in 2012, and a very small soybean harvest in South America this year," Professor Good said. "These strong market fundamentals continue in the form of a rapid pace of consumption and concerns about the size of the 2012 US crop."

Good reported that soybean prices began moving higher in July 2010, starting from about $9.50. July 2012 soybean futures reached a high of about $14.70 in late August 2011, declined to a low near $11.25 in mid-December 2011, and reached a high of $15.12 in early May 2012.



Prices have been very choppy the past two months, but the July futures contract is now trading within about .30 cents of the early May high. November 2012 futures prices have been lower than July futures but have followed a similar pattern and are now trading at a contract high near $14.30.

"The pace of the domestic soybean crush started slowly this year," Professor Good said. "The National Oilseed Processors Association reported that its members crushed 7.7 per cent fewer soybeans in the first quarter of the 2011-12 marketing year than in the same quarter the previous year."

 Crush during the second quarter, however, was 2.3 per cent larger and crush during the third quarter was 7.2 per cent larger than in the respective quarters last year. Crush during the first three quarters of the year was 0.3 per cent larger than the crush last year. For the year, the USDA projects the crush to be 0.7 per cent larger than during the 2010-11 marketing year, he said.

"It now appears that the crush may exceed that projection for several reasons. First, crush was relatively small in the fourth quarter of the 2010-11 marketing year. Second, the pace of domestic soybean meal consumption has been expanding. Third, the small South American crop may support US soybean meal exports above the current projection. The crush may be about 10 million bushels larger than the current projection of 1.66 billion bushels," Professor Good said.

At the beginning of the marketing year, the USDA projected US exports at 1.415 billion bushels, said Professor Good. The projection was reduced as the year progressed and was at 1.275 billion bushels by January 2012.

"The forecast, however, increased beginning in April and now stands at 1.335 billion bushels," he said. "Total export sales already exceed that projection, which is common, and exports will need to average about 13 million bushels per week during the last 10 weeks of the year to reach the projection."



The current pace of exports is a little slower than the needed pace, but exports are still likely to reach the projected level. While the pace of exports has slowed in a typical seasonal pattern, sales for export during the 2012-13 marketing year are record large, underscoring the strength in Chinese demand.

"The USDA will update the projections of consumption and ending stocks for both marketing years on July 11. The estimate of June 1 stocks, to be released on June 29, will provide some confirmation about the pace of consumption and likely year-ending stocks," Professor Good said.

With prospects for relatively small year-ending soybean stocks, the focus is quickly turning to the prospective size of the 2012 US crop. An estimate of planted and harvested acreage will be available with the USDA's 29 June Acreage report.

"With the soybean price rally that occurred this spring, it would not be surprising if acreage exceeded intentions reported in March," Professor Good said. "While acreage estimates will influence production prospects, the major focus will be on yield prospects."

In the June WASDE report, the USDA projected a US average yield of 43.9 bushels and 2012-13 marketing year-ending stocks at what is generally considered to be a minimum level of 140 million bushels. Good said that the trend yield for 2012 is 43.4 bushels, 1.9 bushels above the 2011 average yield.

"Continuation of stressful weather in the central and eastern growing areas along with declining crop condition ratings suggest that the 2012 yield could be below trend again in 2012," Professor Good said. "A shortfall in production would require that consumption during the year ahead be reduced from the current USDA projection of 3.255 billion bushels. The recent price rally is in recognition of the rationing that may be required.

"Unless weather and crop conditions improve soon, which does not appear likely, additional price strength is expected," Professor Good said. "Talk of the 2008 futures price peak near $16.60 has surfaced. While prices at that level are not yet justified, they are within the range that we have projected for the 'new era' of prices that began in 2007."
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on July 07, 2012, 10:46:29 AM

Soybean Farmers Committed to Feeding the World Sustainably
06 July 2012


US - US soybean farmers are well aware of the United Nations projection that global food production will have to rise by 50 per cent by the year 2030 to meet the demands of a growing population. Soybeans are emerging as a critical crop of a healthy and abundant food to feed the world. Soy products provide healthful food in the form of tofu, edamame, soy milk, and other vegetarian options.

Most soybean meal, however, is used in animal feed to create valuable protein, such as poultry, pork and fish. The Soy Aquaculture Alliance, an organization that coordinates research and support for soy use in aquaculture, states that the most efficient use of soy in animal feed is in fish feed, with one to 1.5 lbs. of feed producing one pound of fish. In comparison, it takes up to 1.9 lbs. of feed to produce one pound of poultry and 2.5 lbs. of feed to produce one pound of pork.
 
Aquaculture presents a huge opportunity to feed the world one of the healthiest foods on the planet – fish and seafood rich in heart-healthy Omega-3s. In 2011, the United Nations' Food and Agriculture Organization reported that, worldwide, more fish for human consumption is being produced by aquaculture than is being wild-caught, and that the wild harvest is unlikely to ever increase again due to over-fishing.
 
Also in 2011, Conservation International published a study that showed how aquaculture has the least environmental impact than any other means of protein production globally. In the last 10 years, it has been proven that, when done correctly, ocean aquaculture has no significant impact on the ocean environment, while producing high quality, healthful marine fish that are in high demand from chefs and consumers.
 
Soybean farmers continue to help the aquaculture industry develop environmentally-sound practices, whether fish are farmed in the sea or on land in tanks. The sustainability of global aquaculture depends on renewable and efficient sources of fish feed ingredients, such as US soybeans. Soybean meal and soy oil can replace half to nearly all of the fishmeal and fish oil in feeds for many species, easing pressure on capture fishery resources.
 
Soybean meal has the best amino acid complex of all of the plant protein ingredients and is highly digestible to most cultured fish and shrimp species. Every fish species has different nutritional requirements, and obviously, there will not be one feed ingredient that meets the needs of all farmed fish. The aim of the soy industry is to provide viable, affordable alternatives to the limited resource of fishmeal and fish oil, which can scale up for a growing aquaculture industry. Continuing research and development of soy-based feeds is yielding very promising results, as well as research in other alternative proteins.
 
The US soy industry is made up of hundreds of thousands of family farmers who are working land that has been in their families for many generations. Soybean farmers take their stewardship of the land seriously, and have a long history of increasing production while decreasing environmental impacts. Soybeans have always been an environmentally beneficial crop to rotate after harvest of other crops, such as corn, as they fix nitrates in the soil. With advances in biotechnology in the last decade, soybean farmers have been able to greatly increase the environmental sustainability of their farms.
 
The biggest environmental impact has been the adoption of no-till farming, with herbicide-tolerant crops that allow farmers to completely eliminate plowing on their fields. No-till farming results in better soil health and conservation, improved water retention, decreased soil erosion and decreased herbicide runoff. In fact, no-till farming has led to a global reduction of carbon dioxide, which, in one year, is the equivalent of removing almost seven million cars from the road. Thanks to biotechnology, global pesticide applications have decreased 379 million pounds in the last decade, improving water quality both through less pesticide and herbicide application and less runoff through fields. Studies have shown that this encourages the growth of habitats that support different varieties of wildlife.
 
US soybean farmers remain committed to environmental stewardship of land resources, conservation of ocean resources, and providing consumers with safe, healthy and abundant food.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on July 15, 2012, 05:16:11 AM

Poor Growing Conditions Affect Grain Supply and Demand
12 July 2012


US - Dry weather continued to influence the crop outlook in the World Agricultural Supply and Demand Estimates released today by the Agriculture Department, according to the American Farm Bureau Federation.

The WASDE report showed smaller projected yields from June estimates across the board for US soybean and corn crops, despite increased planting acreage from last year. It also showed a decrease in projected ending stocks and feed use. According to AFBF economist Todd Davis, these trends will likely continue through the year.
 
“The reductions in the July report reflect the World Agricultural Outlook Board belief that the drought has greatly reduced the production potential for corn and soybeans,” said Dr Davis.
 
Corn yield was estimated at 146 bushels per acre, reduced by 20 bushels per acre from the June projections. The 2012-13 corn production estimate was subsequently affected, dropping to 12.97 billion bushels, a 1.82 billion bushel decrease.
 
The projected decreases in corn production will also have consequences on feed use. Ethanol use is also projected down 100 million bushels from June and export demand in corn has been reduced 300 million bushels.
 
The average projected soybean yield fell by 3.4 bushels per acre from June to 40.5 in July. Despite an increase in projected plantings, the substantial yield reduction pulled down this month’s estimate of production by 155 million bushels from June to 3.05 billion bushels. This number is slightly lower than the 2011 crop.
 
“Expect a lot of volatility in the coming year,” said Dr Davis. “As the crop size declines, USDA will make further cuts to projected use while prices climb to both curb demand and encourage production in 2013.”
 
The report projected increased corn prices of $1.30 per bushel from the June estimate to $5.90 per bushel for the 2012-13 marketing year.
 
According to Dr Davis, tighter projected stocks are to blame for the increase in prices. The 2012-13 ending stocks for corn are projected to decline 698 million bushels from June’s estimate to 1.183 billion bushels in July’s report. Soybean ending stocks don’t look any better, down 10 million bushels from June estimates to a current projection of 130 million bushels.
 
A report due out in August will have the first survey-based measure of crop yield potential. USDA will conduct producer surveys and field analysis throughout the fall and will then have a better idea of the damage done to the 2012 corn and soybean crop, according to Dr Davis.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on July 29, 2012, 12:20:44 AM

Feed Grain Prices Surge Throughout July
27 July 2012
 
AUSTRALIA - Australian feed grain prices increased dramatically in July, underpinned by developments in international markets, reports Meat and Livestock Australia.

Feed wheat prices delivered Sydney averaged $286/tonne during July, increasing 18 per cent on the same time last year and surpassing the A$300/tonne mark in the final week of July for the first time since the middle of October 2010 (The Land).
 
In what is being described as the worst drought in 50 years, the ongoing hot conditions across the US corn belt continues to drive the rise in grain prices, while dry weather in Russia and wet conditions throughout the UK is also placing pressure on feed grain supplies.
 
Feed barley ($248/tonne) and triticale ($272/tonne) prices also rose during July, increasing 11 per cent and 18 per cent, respectively, on the same month last year. While the surging grain prices are great news for grain producers, the rising prices will challenge those livestock producers reliant on supplementary feed, particularly those in the lotfeeding industry.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 03, 2012, 08:53:56 AM

CME: Corn Futures Closed Lower Tuesday
01 August 2012






US - September Corn finished down 13 1/4 at 806 3/4, 18 1/4 off the high and 1 1/2 up from the low. December Corn closed down 8 at 806. This was 4 1/2 up from the low and 14 1/2 off the high.

December corn traded slightly lower into the closing bell and managed to hold the 800 level on the day. The lower trade reflects profit taking following yesterday's sharply higher trade.

The Midwest weather forecast remains unfavorable for fall crops, with 90-100 degree temperatures expected for growing areas in the Southwestern Corn Belt this week and part of next week.
 
Scattered showers are also expected in the Midwest to finish out the week but soil conditions are so poor that the light rainfall will provide limited relief. Most of the corn crop is beyond repair at this point, but cooler temperatures may be able to stabilize yield loss for some areas.
 
Taiwan reportedly bought 60,800 tonnes of Brazilian corn overnight, which may be adding pressure to the corn complex today.

Argentina also announced that they would enact a new export policy that grants farmers permission to sell their whole corn harvest as they set single year export quotas, instead of the incremental quota system currently in place.

The market is still trying to gauge yield and production expectations for this year's corn crop ahead of the USDA report next week. Current market conditions suggest a corn yield near 129 bushels/acre with some estimates coming in near 120-122.
 
Outside markets were mixed today with the US Dollar trading lower and crude oil sharply lower on the day. September Rice finished down 0.22 at 15.615, 0.135 off the high and equal to the low.

Soybean Futures Closed Lower

August Soybeans finished down 4 3/4 at 1721, 21 off the high and 9 1/2 up from the low. November Soybeans closed down 2 1/2 at 1641. This was 11 1/4 up from the low and 22 1/4 off the high.

August Soymeal closed down 1.4 at 544.9. This was 3.5 up from the low and 9.3 off the high. August Soybean Oil finished down 0.02 at 52.55, 0.51 off the high and 0.4 up from the low. November soybeans traded slightly lower into the close but traded both sides of the unchanged today.

Early pressure was seen just prior to the start of pit trading, but the market found good support near the lows of the day. A late day sell off was linked to spillover pressure from a sharply lower wheat market and profit taking in corn.

The Midwest weather outlook for the next 2 weeks is offering support. Scattered showers are expected in the northern plains, parts of the central Midwest, and the eastern Corn Belt over the next week. Accumulation is expected to be light and be of very little benefit to soybean crops.
 
Blistering temperatures will move into the Southwestern Corn Belt today and tomorrow. Cooler temperatures are expected early next week, which may provide some relief to crops. Another round of above normal temperatures is forecasted for later next week.
 
Current price levels and crop reports suggest the market is trading a yield between 38-39 bushel/acre. Without cooler and wetter conditions in the next two weeks, soybean crops are susceptible to further yield deterioration. Outside markets were mixed today with the US Dollar trading lower and crude oil sharply lower on the day.

Wheat Futures Closed Lower

September Wheat finished down 26 1/4 at 888 1/4, 31 1/4 off the high and 2 1/4 up from the low. December Wheat closed down 24 3/4 at 902 1/2.

This was 2 up from the low and 29 off the high. September Chicago wheat traded sharply lower into the close of today's session as traders took profits following gains this week.

The wheat market began the day weaker, but losses were accelerated after corn began to tumble from it's record highs.

Russia's Agriculture Ministry may cut it's 2012 grain crop production forecast to 75 million tonnes from it's current estimate of 80 million tonnes but traders brushed off the news after the Prime Minister of Russia said he did not expect a domestic deficit for grain despite the lower production estimates.

Jordan announced a purchase of 100,000 tonnes of wheat from their tender issued last week. The official origin is unknown, but traders believe the seller likely came from the Black Sea region.
 
Outside markets were mixed with the US Dollar trading lower and crude oil trade sharply lower on the day. September Oats closed down 4 at 380 1/4. This was 2 1/4 up from the low and 5 off the high.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 11, 2012, 09:32:25 AM
USDA WASDE

Reports» USDA WASDE» USDA WASDE - August 2012

10 August 2012
USDA WASDE - August 2012



 

WHEAT: U.S. wheat supplies for 2012/13 are raised 54 million bushels with higher forecast production and an increase in projected imports. Production is forecast 44 million bushels higher with increased yields for winter wheat, durum, and other spring wheat. Feed and residual use is projected 20 million bushels higher, reflecting the tighter supply situation for corn. Ending stocks for 2012/13 are projected 34 million bushels higher. The projected range for the 2012/13 seasonaverage farm price is raised substantially to $7.60 to $9.00 per bushel, compared with $6.20 to $7.40 per bushel last month, as tighter foreign wheat supplies and sharply higher corn prices raise price prospects for the remainder of the marketing year.

Global wheat supplies for 2012/13 are projected 2.1 million tons lower mostly reflecting a 3.7- million-ton reduction in foreign production. A small increase in 2012/13 world beginning stocks is partly offsetting with 2011/12 updates to trade and use for a number of countries. Lower expected production in the FSU-12 accounts for most of this month’s decline in world output. Production is lowered 6.0 million tons for Russia on reduced area and yield prospects due to July heat and dryness across most of the spring wheat growing areas. Spring wheat in adjoining areas of Kazakhstan was also affected by the same adverse weather reducing production prospects 2.0 million tons. Other reductions this month include a 0.8-million-ton reduction for Turkey based on lower reported yields, a 0.5-million-ton reduction for Argentina reflecting lower expected area, a 0.3- million-ton reduction for Syria, and a 0.2-million-ton reduction for EU-27. Production is raised 2.9 million tons for India, 2.0 million tons for Ukraine, and 0.4 million tons each for Canada and Uzbekistan.

Global wheat consumption for 2012/13 is raised 3.2 million tons as a number of countries are expected to shift some of their livestock and poultry feeding from corn to wheat. Wheat feeding is raised 1.0 million tons each for EU-27 and Ukraine, 0.5 million tons each for South Korea and Vietnam, 0.3 million tons for Israel, and 0.2 million tons each for India and Thailand. Partly offsetting is a 0.5-million-ton reduction for Russia with lower expected production.

Global wheat imports for 2012/13 are raised with increases for several countries, in part, to support higher wheat feeding. Imports are raised 0.5 million tons each for EU-27, South Korea, and Vietnam, and raised 0.3 million tons for Israel. Imports are also raised 0.3 million tons for Brazil. Global 2012/13 exports are raised, but much of the shift among countries also reflects reduced export prospects for Russia, which is lowered 4.0 million tons. Exports are raised 2.0 million tons for Ukraine, 1.0 million tons each for Canada and EU-27, 0.5 million tons each for Australia, Brazil, and Pakistan. Exports are lowered 0.7 million tons for Argentina, 0.5 million tons for Turkey, and 0.2 million tons for Uruguay. World ending stocks for 2012/13 are projected 5.3 million tons lower at 177.2 million.

COARSE GRAINS: U.S. feed grain supplies for 2012/13 are projected sharply lower again this month with corn production forecast 2.2 billion bushels lower and sorghum production forecast 92 million bushels lower. The forecast U.S. corn yield is reduced 22.6 bushels per acre to 123.4 bushels as extreme heat and dryness continued, and in many areas worsened, during July across the Plains and Corn Belt. As forecast, the 2012/13 corn yield would be the lowest since 1995/96. Corn area harvested for grain is also lowered, down 1.5 million acres from the last month’s forecast that was based on the June Acreage report. The U.S. sorghum yield is forecast 16.3 bushels per acre lower at 48.6 bushels as drought stressed sorghum from the Central Plains to the Corn Belt. Sorghum harvested area is also lowered slightly.

U.S. corn production for 2012/13 is forecast at 10.8 billion bushels, the lowest since 2006/07. Relatively small increases in carryin and imports only partly offset this month’s substantial reduction in crop size. Ending stocks for 2011/12 are projected 118 million bushels higher with lower expected exports, reduced corn use for ethanol, and a small increase in imports. Imports for 2012/13 are also raised, up 45 million bushels to 75 million, reflecting strong domestic corn prices and competitively priced foreign supplies. Total U.S. corn supplies for 2012/13 are projected down 2.0 billion bushels and at a 9-year low.

This month’s large reduction in U.S. corn supplies and the sharply higher price outlook are expected to further reduce 2012/13 corn usage. Total use is projected 1.5 billion bushels lower and at 11.2 billion would be a 6-year low. The biggest reduction again this month is for feed and residual disappearance, projected down 725 million bushels. Food, seed, and industrial (FSI) use is also projected lower, down 470 million bushels, mostly reflecting a 400-million-bushel reduction in corn used to produce ethanol. Reductions in other food and industrial uses account for the remainder of the FSI decline. Ending stocks for 2012/13 are projected at 650 million bushels, 533 million lower and the smallest carryout since 1995/96. The 2012/13 season-average farm price for corn is projected at a record $7.50 to $8.90 per bushel, up sharply from the $5.40 to $6.40 per bushel projected in July. Projected farm prices for the other feed grains are also raised.

Global coarse grain supplies for 2012/13 are reduced 56.5 million tons mostly reflecting the forecast 55.7-million-ton reduction in the U.S. corn crop. Larger 2012/13 corn beginning stocks in the United States and Brazil partly offset lower U.S. and foreign coarse grain production. Brazil corn beginning stocks are raised 2.8 million tons based on higher reported production for 2011/12.

Foreign corn production for 2012/13 is mostly unchanged with increases for China, Argentina, Brazil, Mexico, and South Africa mostly offset by reductions for EU-27, Ukraine, India, Serbia, Russia, Croatia, Moldova, and Canada. Foreign sorghum production is lowered 0.3 million tons with a reduction for India. Reductions in barley production in FSU-12, EU-27, and Turkey lower global barley production 1.1 million tons. A 2.5-million-ton reduction in India millet output also lowers world coarse grain supplies.

Global 2012/13 corn trade is projected sharply lower this month in response to tighter U.S. supplies and higher prices. Corn imports are lowered for China, EU-27, Indonesia, Japan, South Korea, Mexico, Vietnam, Israel, Colombia, Peru, and Syria. In addition to the United States, corn exports are reduced for Ukraine, EU-27, and Serbia. Partly offsetting are export increases for Argentina, Brazil, South Africa, and Canada. Global corn consumption is projected 38.9 million tons lower with the United States accounting for more than three-fourths of the reduction. Foreign corn feeding drops 8.8 million tons with only part of the decline offset by higher wheat feeding. Corn feeding is lowered for EU-27, India, Canada, Japan, South Korea, Russia, Ukraine, Vietnam, Israel, and Indonesia. Global corn ending stocks are projected 10.8 million tons lower with increases for China, Brazil, and Argentina only partly making up for the large reduction in the United States and smaller reductions in a number of other countries.

RICE: U.S. total rice supplies for 2012/13 are projected at 244.4 million cwt, down 2.5 million from last month. Projected beginning stocks, imports, and production are each lowered from a month ago. USDA's first survey-based forecast of the 2012/13 U.S. rice crop is 190.0 million cwt, down 1.0 million from last month's projection, but up nearly 3 percent from the previous year. Average all rice yield is forecast at 7,196 pounds per acre, down 39 pounds per acre from last month’s projection, but up nearly 2 percent from last year. Long-grain production is forecast at 132.1 million cwt, down 1 percent from last month, while combined medium- and short-grain production is forecast at 57.9 million, up less than 1 percent from a month ago. The all rice import projection is lowered 0.5 million cwt to 21.0 million due in part to an expected slower pace of long-grain imports from South and Southeast Asia, a continuation of the trend observed in 2011/12. All rice beginning stocks for 2012/13 are lowered 1.0 million cwt to 33.5 million because of an increase in the 2011/12 export estimate to 102.0 million.

U.S. total rice use for 2012/13 is projected at 216.0 million cwt, down 2.0 million cwt from last month. All rice domestic and residual use is lowered 2.0 million cwt to 124.0 million, all in longgrain. The all rice export projection is unchanged at 92.0 million cwt, however, the rough rice component is raised 1.0 million and offset by a 1.0 million reduction in combined milled- and brownexports (rough-equivalent basis). The long-grain and combined medium- and short-grain export projections are unchanged at 60.0 million cwt and 32.0 million, respectively. U.S. all rice ending stocks for 2012/13 are projected at 28.4 million cwt, down 0.5 million from last month, and 15 percent below the previous year.

The 2012/13 long-grain U.S. season-average farm price is projected at $13.50 to $14.50 per cwt, up 50 cents per cwt on each end of the range. The combined medium- and short-grain price is projected at $15.50 to $16.50 per cwt, unchanged from a month ago. The 2012/13 all rice price is projected at $14.10 to $15.10 per cwt, up 30 cents per cwt on each end of the range. A smaller crop and tighter supplies, particularly for long-grain rice, are expected to support prices. The all rice stocks-to-use ratio at 13.2 percent in 2012/13 is the lowest since 2007/08, and the long-grain rice stocks-to-use ratio at 10.6 percent is the lowest since 2003/04.

Lower projected global 2012/13 total supply more than offsets a slight decrease in total use resulting in an expected decrease in ending stocks. Global production is lowered 1.9 million tons to 463.2 million, due primarily to forecast reductions for India, Brazil, and North Korea, which are partially offset by increases for China and South Korea. Beginning stocks are increased 0.8 million tons due to a 1.0-million-ton increase for India, which is partially offset by reductions for Brazil and Indonesia. World consumption is reduced 0.4 million tons. A 1.0-million-ton increase in China offsets an identical reduction for India. Consumption forecasts are also lowered for Brazil, North Korea, and the United States, partially offset by an increase for Indonesia. Global trade is changed little from a month ago. Global ending stocks for 2012/13 are projected at 101.8 million tons, down 0.7 million from last month, and a decrease of 3.2 million from the previous year. The largest stocks reductions for 2012/13 are for Brazil and Indonesia, each just over 0.3 million tons.

OILSEEDS: U.S. oilseed production for 2012/13 is projected at 83.4 million tons, down 9.4 million from last month, as a lower soybean production estimate is only partly offset by higher crops of peanuts and cottonseed. Soybean production for 2012/13 is projected at 2.7 billion bushels, down 358 million due to lower harvested area and yields. Harvested area is projected at 74.6 million acres, down 0.7 million from the July projection. The first survey-based soybean yield forecast of 36.1 bushels per acre is 4.4 bushels below last month’s projection and 5.4 bushels below last year’s yield. Soybean supplies for 2012/13 are projected 12 percent below last month to a 9-year low on lower production and reduced beginning stocks. Soybean exports are reduced 260 million bushels to 1.11 billion bushels. Soybean crush is also reduced as higher prices reduce domestic use and prospective exports for both soybean meal and oil. Soybean ending stocks are projected at 115 million bushels, down 15 million.

U.S. changes for 2011/12 include increased soybean crush and exports and reduced ending stocks. Crush is increased 15 million bushels to 1.69 billion reflecting increased exports and domestic use of soybean meal. Soybean exports are increased 10 million to 1.35 billion bushels reflecting strong shipments in recent weeks. Soybean ending stocks are projected at 145 million bushels, down 25 million.

Soybean and product prices for 2012/13 are all raised to record levels this month, reflecting the impact of sharply reduced soybean and corn production. The U.S. season-average soybean price is projected at $15.00 to $17.00 per bushel, up $2.00 on both ends. Soybean meal prices are projected at $460 to $490 per short ton compared with $365 to $395 last month. Soybean oil prices are projected at 53 to 57 cents per pound, up 0.5 cents on both ends.

Global oilseed production for 2012/13 is projected at 457.3 million tons, down 8.5 million tons from last month. Reductions for soybeans, sunflowerseed, peanuts, and cottonseed are only partly offset by increased rapeseed production. Lower soybean production is projected for the United States, Canada, and EU-27 due to lower yields resulting from hot, dry weather. Soybean production is raised for Brazil and Paraguay as producers are expected to respond to sharply higher prices with increased plantings. Brazil’s soybean production is projected up 3 million tons at a record 81 million. Sunflowerseed production is reduced for EU-27, Ukraine, and Moldova due to the effects of hot, dry weather during the reproductive stage of the crops. Other changes include higher rapeseed production for EU-27 and Ukraine, lower rapeseed production for China and Australia, lower peanut production for India and Indonesia, and lower cottonseed production for India.

Global oilseed and meal production, trade, and consumption for 2012/13 are all reduced this month reflecting the impact of reduced oilseed supplies and higher prices. Projected soybean imports for China are reduced 1.5 million tons to 59.5 million as domestic soybean stocks contribute a larger component of soybean meal consumption. Soybean exports for Brazil and Argentina are forecast higher but only partly offset a reduction for the United States.

SUGAR: Projected U.S. sugar supply for fiscal year 2012/13 is decreased 251,000 short tons, raw value, compared with last month. Carry-in stocks are reduced mainly due to data revisions in Sweetener Market Data, which lower 2011/12 ending stocks. Imports from Mexico are decreased due to higher sugar consumption and carryout stocks in Mexico. Total use is unchanged.

COTTON: The U.S. 2012/13 cotton supply and demand estimates include larger production and ending stocks compared with last month. Production is raised 651,000 bales to 17.7 million, up nearly 4 percent, based on USDA’s first crop survey. Domestic mill use is unchanged. Exports remain forecast at 12.1 million bales, despite the larger supply, due to reduced import demand by China. Ending stocks are now forecast at 5.5 million bales, equal to 35 percent of total use. The range for the marketing year average price received by producers is narrowed 1 cent on each end to 61 to 79 cents per pound.

This month’s world 2012/13 cotton estimates also show larger supplies and ending stocks. Beginning stocks are raised nearly 2.0 million bales in China as a result of adjustments to 2011/12 which both increase imports and reduce consumption. The higher China stocks are partially offset by lower beginning stocks in Australia, Malaysia, Pakistan, and others, resulting in a net global increase of 1.1 million bales. World production is raised 300,000 bales, as increases for the United States, China, Burkina Faso, and Mali are partially offset by lower production for India, Brazil, Argentina, and others. World consumption is reduced 820,000 bales, due mainly to reductions for China and Pakistan. World trade is reduced slightly, as lower imports by China are partially offset by small increases for several countries. World stocks are raised to 74.7 million bales, including an increase of nearly 2.4 million bales in stocks held by China; lesser increases for the United States, Pakistan, and Uzbekistan are about offset by decreases for India, Australia, and Brazil. Projected China stocks of 34.2 million bales account for 46 percent of the world stocks forecast, and assume a net increase in China’s national cotton reserve of about 20 percent during 2012/13.

LIVESTOCK, POULTRY, AND DAIRY: The forecast for 2012 total red meat and poultry production is raised from last month but the forecast for 2013 is reduced as higher feed prices are expected to pressure producer returns. Beef production is raised from last month for both 2012 and 2013 due to higher expected placements in feedlots and increased dairy cow slaughter in late 2012 and during 2013. Carcass weights are forecast higher based on recent weight trends, but higher feed prices are expected to temper the increase and carcass weights are expected to be lower in 2013 compared to 2012. Pork production is reduced from last month for both 2012 and 2013. The reduction for 2012 reflects lower slaughter in the third quarter and lighter expected carcass weights through the year. As a result of high feed prices and recent hot weather, forecast pig crops are lowered in the second half of 2012 with declines continuing into 2013. Pork production is forecast lower in 2013 due to a combination of smaller hog supplies and lower expected carcass weights. Broiler production is raised in 2012 as production in the second quarter was higher than forecast last month and hatchery data points to higher than previously forecast levels of production in the third quarter. However, high feed costs are expected to result in lower broiler production in 2013. Turkey production is forecast lower in 2012 on lower second-quarter production. The production forecast for 2013 is reduced as feed prices squeeze producer returns. The egg production forecast is lowered for both 2012 and 2013.

Beef imports are reduced for 2012 based in part on weaker second-quarter data but are unchanged for 2013. Beef exports are reduced for both 2012 and 2013 as exports have slowed and tight supplies of pork and poultry are expected to support domestic beef demand. Pork and poultry exports are reduced for both 2012 and 2013.

Cattle prices are reduced from last month with the expectation of larger fed cattle marketings in both 2012 and 2013. However, prices are likely to remain strong in 2013 as total meat supplies are tight. Hog prices are raised in both years due to smaller hog supplies. Broiler prices are reduced in 2012 due to larger expected supplies and somewhat weaker demand, but for 2013, tighter supplies are expected to help support higher prices. Turkey and egg price forecasts are raised on lower production.

Milk production forecasts for 2012 and 2013 are reduced from last month as higher forecast feed prices are expected to pressure producer returns and encourage a more rapid decline in the cow herd. Milk per cow is also reduced due to tighter feed supplies. Imports for 2012 are raised on both a fat and skim-solids basis and are raised on a fat basis for 2013. Exports are raised for 2012 but exports for 2013 are reduced from last month on tighter supplies. Ending stocks are reduced. Product prices are forecast higher for 2012 and 2013 as tighter supplies support prices. With higher product prices, both Class III and Class IV price forecasts are raised. The all milk price is forecast at $17.55 to $17.75 per cwt for 2012 and $17.80 to $18.80 per cwt for 2013.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 16, 2012, 02:06:07 AM

US Grains Council: Global Analysis of Grain Supply
15 August 2012

GLOBAL - In its monthly agricultural supply and demand update, the US Department of Agriculture again lowered the outlook for US corn production, reflecting the continued deterioration of this year's crop due to the once-in-a-lifetime drought that affects most of the US Corn Belt.

The latest USDA projection lowers US corn production to 274 million metric tons (10.8 billion bushels), down almost 40 million tons (1.6 billion bushels) from last year, and the lowest since 2006, according to the US Grains Council.

 World corn production is estimated at 849 million tons (33.4 billion bushels), down 27 million tons (1.1 billion bushels) from last year, but 19 million tons (748 million bushels) higher than 2010/2011 due to higher production from China, Brazil and Argentina.




With this large reduction in US corn supplies, higher prices are expected to ration demand during the coming year. USDA projects that total world corn use will decline about seven million tons (275.6 million bushels) from last year, while US total use will drop 25 million tons (984.2 million bushels):
 •Feed use down 12 million tons (472.4 million bushels)
 •Corn use for ethanol down 12.7 million tons (500 million bushels)
 •Exports down 6.3 million tons (248 million bushels)

USDA expects world corn imports to decline by almost seven million tons (275.6 million bushels), while non-US feed use will continue to grow, up 13 million tons (511.8 million bushels) from last year to 405 million tons (15.9 billion bushels).
 




Global Implications
 
From a broader perspective, world coarse grain feed use (including mainly corn, sorghum and barley) will be essentially unchanged from last year at 660 million tons, compared with 658.5 million tons in 2011/12.

 Countries will respond to the tight corn supplies and higher prices in the coming year in different ways according the USDA estimate. For example, Japan and South Korea imports are projected to be unchanged from 2011 to 2012.

 China's corn imports likely will decrease by three million tons (118.1 million bushels) due partly to a record domestic corn harvest of 200 million tons (7.9 billion bushels), which is up seven million tons (275.6 million bushels) from last year.
 

Globally, all corn users will face the challenge of higher prices and the need for increased efficiency, careful risk management and creative marketing strategies during the coming year.

As the projections for US corn use demonstrate, the high prices will ration demand in all markets and in all sectors (feed, food and fuel). Also, the relatively smaller decline in US exports compared to domestic use reflects the resilience of global feed demand.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 18, 2012, 03:03:23 AM
Alan Brugler Market Commentary
 
Market Commentary - August 17, 2012

 




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Corn
 

Corn futures are trading slightly higher to slightly lower at midday. Trade activity seems to be light ahead of the weekend. Cooler Midwest temperatures prevail giving us all a break for now. We are hearing harvest reports with the corn season advanced because of this year’s high temps and drought conditions. The energy went to the corn ear vs. the stock and so farmers are pressed to harvest wetter corn to get it out rather than risk adverse weather. The weekly crop progress report should be interesting Monday. We expect it could begin posting harvested numbers. The Pro Farmer Midwest Crop Tour will start next week from Ohio to Minnesota. Other groups will tour S. Dakota, NE, IA and Minnesota.

Sep 12 Corn is at $7.99 1/4, up 1 1/2 cents,

Dec 12 Corn is at $8.07, down 1/2 cent,

Mar 13 Corn is at $8.07 1/4, unch ,

Jul 13 Corn is at $8.00 3/4, down 1/2 cent





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Soybeans
 

Soybeans are currently trading higher with the range relatively narrow today. Higher prices are expected to encourage increased soybean planting in South America for the coming season. U.S. soybean supplies are approaching dangerously low levels if the weather doesn’t change soon. The eastern growing areas have seen some improvement in conditions which should help but IA and NE that were number one and number three in production last year still need rain. Temperatures in those areas are cooler with normal rainfall predicted but normal rainfall in August has not normally been abundant. According to NOAA, the month of August is about #5 in terms of annual precipitation. USDA is already putting bean yields at a 10 year low. There is some discussion about planted acres this year being different between USDA and FSA. FSA does monthly totals. The two will come together in September and we will get a revision in October. China sold 402,375 MT of state reserve soybeans at auction which is what was offered. The selling price was about 8% lower than imported beans.

Sep 12 Soybeans are at $16.63 1/4, up 7 cents,

Nov 12 Soybeans are at $16.36 3/4, up 11 1/2 cents,

Jan 13 Soybeans are at $16.27 1/2, up 12 3/4 cents,

Mar 13 Soybeans are at $15.46, up 11 1/2 cents,

Sep 12 Soybean Meal is at $518.20, up $1.70,

Sep 12 Soybean Oil is at $53.23, up $0.19





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Wheat
 

Wheat futures are trading higher for the third day in a row. South Korea bought 49,000 MT of wheat from Columbia Grain. U.S. wheat is priced higher than other world supplies which could limit exports. However with production issues in the Black Sea and reduced wheat acres in South America next year importers may still choose to come to the U.S. India does have some reserves and Australia got some needed rains in the west with conditions favorable in eastern Australia for winter wheat. The Argentine wheat crop is thought to be in good shape for 2012/13 and was 95% planted as of August 8th. The Argentine Ag minister said 85% of the crop is in good to very good shape.

Sep 12 CBOT Wheat is at $8.69, up 7 1/4 cents,

Sep 12 KCBT Wheat is at $8.77 3/4, up 5 1/4 cents,

Sep 12 MGEX Wheat is at $9.28, up 6 1/2 cents

Dec 12 MGEX Wheat is at $9.39 1/2, up 7 1/2 cents





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Cattle
 

Cattle futures are trading mixed. Cash sales so far have only been reported for Nebraska at $120 in the live and $190 in the dressed. That is steady to $2 higher than last week.  USDA will issue their monthly Cattle on Feed report this afternoon. The trade average guess for August 1 On Feed is 100.7% of year ago. The average placement estimate is at 91.4% and Marketings during July are thought to have been around 101.6%. Wholesale beef prices are higher at midday. Choice boxes are $1.53 higher and Select boxes were up $0.38. The spread is at $8.23. Estimated week to date cattle slaughter is at 505,000 head, down from 517,000 last year.

 

Aug 12 Cattle are at $121.350, up $0.500,

Oct 12 Cattle are at $125.675, up $0.125,

Dec 12 Cattle are at $128.400, up $0.325,

Aug 12 Feeder Cattle are at $140.450, up $0.625

Sep 12 Feeder Cattle are at $142.450, up $0.200





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Lean Hogs
 

Lean Hogs are trading higher recovering a small portion of this week’s sell off as the weekend approaches. The CME Index is at 91.58, down $0.26 from the previous day. It still has a huge premium to October futures which has been the case the last couple of years.  Cash hogs were reported $1.63 lower in IA/MN. The Carcass cutout was lower yesterday and pork trade is very slow today with light demand and light to moderate offerings.  Estimated week to date slaughter was 1.671 million head compared to 1.651 million a year ago. 

 

Oct 12 Hogs are at $76.075, up $0.450,

Dec 12 Hogs are at $73.550, up $0.650

Feb 13 Hogs are at $80.800, up $0.300





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Cotton
 

Cotton futures are trading higher and have been holding an uptrend line since late June on the daily chart. US Certified stocks for August 16th were 25,440 unchanged from the previous day. Crude oil is now higher and the dollar is still up on the day. Last week’s pre report price rally did not curb export sales but sales under 100,000 bales are nothing to write home about as we head into harvest with the crop looking good and China stockpiles considered substantial. The Cotlook A index is down 0.50 at 82.75.

 

Oct 12 Cotton is at 73.43, up 106 points,

Dec 12 Cotton is at 73.91, up 132 points

Mar 13 Cotton is at 74.52, up 132 points

Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on August 26, 2012, 07:54:12 AM

USGC: Growers Deal with Poor Corn Results
24 August 2012

GLOBAL - With the US corn crop expected to be short following the drought this year, global grain buyers are looking for options to help contain costs. At the same time, farmers in exporting countries around the globe are looking to take advantage of current prices by growing and shipping more corn and coarse grains to willing buyers.
 
Argentina is the world's second-largest corn exporter, and some farmers there are looking to plant their 2012-13 crop early in hopes of taking advantage of recent rains and the run-up in prices due to the drought in the United States.
 
A US Grains Council (USGC) consultant said corn exports for the country's marketing year are approximately 13.5 million tons. However, traders in the region are expecting the government to approve export licenses for another 1.5 million to 2.0 million tons in September. That would bring exports from the country close to the 16.0 million in exports projected by the US Department of Agriculture in its August global supply and demand report.
 
The consultant said Argentina corn exports are ahead of last year and about half of the ountry's exports go to Colombia, South Korea, Malaysia and Peru. While USDA lowered its estimate of Chinese corn imports for the year, the former director of the China's State Administration of Grain said China could look to buy some of its corn needs from Argentina or other exporters, as US corn is priced out of the local market. USDA estimates 2012-13 average US corn prices to be in the $7.50-8.90 per bushel ($295-350 per ton) range.
 
USDA estimates China's corn production at 200 million tons for the year, although officials in the country are saying the crop may be around 197 million tons. The US Grains Council's Beijing office conducted a north China crop tour in July and found a large crop, but the Council will conduct its fall China harvest tour in September to help global grain traders get a better understanding of the country's 2012-13 crop.
 
Corn production in and exports from the Former Soviet Union (FSU) and Ukraine were lowered this month, as were total coarse grains in the two Black Sea exporting regions, due to warm and dry conditions. Wheat exports were lowered by 4 million tons to 8 million tons in Russia but were increased by 2 million tons to 6 million tons in exports for Ukraine. Wheat's importance grows as a feed source as corn prices rise.
 
As for corn, Ukraine's exports were lowered 1.5 million tons to 12.5 million, while FSU exports were lowered 1.5 million tons to 14.4 million.
 
Bill Tierney, chief economist with Chicago-based AgResource Co., told a news service that buyers will not be taken by surprise should Russia and Ukraine move to curtail exports as they did in 2010. While governments of both countries have moved to assure buyers there will be no export ban – or de facto ban – the concern still exists. Some traders said they expect exports in the region to end late this year.
 
Russia enters the World Trade Organization this week, but analysts have said that would not prevent the country from imposing quotes, taxes or embargoes to protect its own supply.
 
"Whether Ukraine or Russia moves to halt or slow exports remains to be seen. Certainly buyers are leery, which makes an important point that is difficult to rebuild trust and reliability once you shut the door," said Cary Sifferath, who operates the US Grains Council's office in Tunis, Tunisia.
 
USDA estimated Brazil's corn exports at 14.0 million tons for 2012-13, on par with last year.
 
South Africa lowered corn production forecast marginally to 10.8 million tons. This may tighten the country's balance sheet for 2012-13. The country has exported more than 290,000 tons of white corn to Mexico this year.
 
Dry conditions are impacting crops in several regions of India and will likely reduce production figures. USDA, however, still anticipates the country will still export wheat, rice, cotton and soybean meal this year.
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on October 07, 2012, 09:49:29 AM
Alan Brugler Market Commentary
 
Market Commentary - October 06, 2012

 




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Corn
 

Corn futures closed lower on the day and were down 8 cents for the week. The weekly CFTC report showed Managed Money increased their net corn long by 671 contracts as of Tuesday the reporting period leaving them with a net long of 272,726 contracts.  Trade estimates for US corn production on next Thursday’s report vary from yields of 119 to 124 or 125 bpa. Private analyst Informa raised their corn yield estimate to 127 bpa and the 2012 corn crop to 11.194 billion bushels which weighed on prices. We have been hearing yield reports on both ends of the spectrum from clients with many happily surprised considering the growing conditions this year. Trade estimates for US corn production vary from yields of 119 to 124 or 125 bpa. Merchants report a need for clean, low aflatoxin corn to blend in states where that is permitted. Producers have been aggressive sellers of corn with aflatoxin due to crop insurance policy requirements.

Dec 12 Corn closed at $7.48, down 9 cents,

Mar 13 Corn closed at $7.48 1/2, down 8 3/4 cents,

May 13 Corn closed at $7.43 3/4, down 9 1/2 cents

Jul 13 Corn closed at $7.37 3/4, down 8 1/2 cents
 




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Soybeans
 

Soybeans closed unchanged on the day and were down 50 cents for the week. The weekly CFTC report showed Managed Money had decreased their net long by 16,660 contracts from the previous week to 178,742 contracts. Private forecaster Informa anticipates USDA will raise their soybean estimate to 37.8 bpa with a production number of 2.86 billion bushels. Most of the yield reports we are hearing from producers is better than they expected but expectations may have been lowered because of the weather this year. The USDA should adjust planted and harvested acres in this report. China was back in the market purchasing 180,000 MT of soybeans for 2012/13 delivery according to private exporters reporting to the USD during their week long holiday week. We are noting an increase in the spread in favor of nearby soybeans compared to the Brazil and Argentine harvest months.

 

Nov 12 Soybeans closed at $15.51 1/2, unch ,

Jan 13 Soybeans closed at $15.51, unch ,

Mar 13 Soybeans closed at $15.13, down 5 1/2 cents,

May 13 Soybeans closed at $14.60 1/2, unch ,

Oct 12 Soybean Meal closed at $474.70, up $3.90,

Oct 12 Soybean Oil closed at $50.76, down $0.24
 




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Wheat
 

Wheat futures closed lower on the day and down 40 to 49 cents for the week. The weekly CFTC report showed Managed Money had decreased their net long in CBT wheat by 7,111 contracts and in KC by 4,197 contracts leaving a net long of 58,197 and 45,431 respectively. As a general trend wheat prices have basically traded sideways for several weeks trading in a 80 to 90 cent range from highs to lows. Export sales are behind the average pace needed to hit the USDA forecast for the year. The U.S. needs rain to help germinate planted winter wheat. The forecast for Oklahoma, Southern KS and much of Texas for the week of October 11-17 is calling for a welcome above normal precipitation with very minimal chances of precipitation before that.  Australian Commonwealth Bank projects Australian wheat exports could fall to 17.8 MMT, down from 24.9 MMT last year. The Australian Bureau of Ag has forecast a 22.5 MMT crop with total supplies of 27.8 MMT.  The September USDA WASDE report listed total supplies at 33.72 MMT with Australian exports at 21 MMT.

 

Dec 12 CBOT Wheat closed at $8.57 1/2, down 11 3/4 cents,

Dec 12 KCBT Wheat closed at $8.78 3/4, down 8 cents,

Dec 12 MGEX Wheat closed at $9.19 1/2, down 6 3/4 cents
 




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Cattle
 

Cattle futures rallied into the close to finish higher on the day and were up 97 cents for the week. The weekly CFTC report showed Managed Money decreased their net long by 14,312 contracts, or over 33% of the previous week’s position. Cash cattle business was active in the Southern Plains yesterday with prices mostly at $124 to $124.50 in the live and $190 to $192 in the dressed. Wholesale prices ended the week lower. Choice boxed beef is down $1.36/cwt and select boxes are quoted $1.45 lower by USDA.  Estimated week to date slaughter is 607,000 compared to 646,000 a year ago. The lack of numbers provides some underlying support to the futures. 

Oct 12 Cattle closed at $123.100, up $0.775,

Dec 12 Cattle closed at $126.300, up $0.600,

Feb 13 Cattle closed at $129.850, up $0.400,

Oct 12 Feeder Cattle closed at $145.075, up $0.600

Nov 12 Feeder Cattle closed at $146.425, up $0.600

Jan 13 Feeder Cattle closed at $149.100, up $0.600
 




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Lean Hogs
 

Lean Hogs ended the session mixed with the spot contract lower. Hogs were up $4.15 for the week.  Managed Money added 1,404 contracts to their net hog long from the previous week. The CME Lean Hog Index was $78.68 up 0.92 as of the 3rd continuing to go up nearly every day. The futures premium to cash remains, with the spread needing to reach convergence at expiration October 12th. Week to date slaughter is estimated at 2.161 million head, 32,000 head more than a year ago. Saturday’s slaughter is estimated at 194 thousand head with packers showing an increased buying interest. Pork trading was slow to moderate with light to moderate demand and mostly light offerings.  The cutout was lower on 63.5 loads. 

Oct 12 Hogs closed at $81.325, down $0.475,

Dec 12 Hogs closed at $76.550, up $0.500

Feb 13 Hogs closed at $82.100, up $0.425
 




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Cotton
 

Cotton futures ended the session lower but were up 65 points for the week.  Sufficient stocks and soft demand have kept prices at the lower end of the past years trading range. Cert stocks at the ICE were 9,595 bales, with 523 new certs and 270 bales awaiting review. Delivery interest has been next to non-existent, with most players already out of the October contract.  Total cotton open interest was 328,330 contracts as of October 4th showing a slight increase over the last couple of weeks with Managed Money adding 13,321 contracts to their net cotton short position.  The Cotlook A index is at 81.30 cents a pound, down 0.05. 

Oct 12 Cotton closed at 69.8, down 60 points,

Dec 12 Cotton closed at 71.49, down 60 points

Mar 13 Cotton closed at 72.3, down 79 points
 


Market Commentary Provided By:


Brugler Marketing & Management LLC
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on October 20, 2012, 10:25:09 AM
USDA Feed Outlook

Reports» USDA Feed Outlook» USDA Feed Outlook - October 2012

16 October 2012
USDA Feed Outlook - October 2012
U.S. corn production for 2012/13 is lowered 21 million bushels as lower yield more than offsets higher area in this month’s forecasts.


 

Smaller Carryin and Forecast Production Tighten Corn Ending Stocks for 2012/13
 
The yield slips 0.8 bushels per acre to 122.0 bushels, and harvested area advances 0.4 million acres to 87.7 million. Corn supplies for 2012/13 are projected 214 million bushels lower, mostly reflecting lower carryin based on September 1 stocks. Projected exports are reduced 100 million bushels. Corn ending stocks for 2012/13 are projected 114 million bushels lower at 619 million. The projected average price received by growers is reduced 10 cents on each end of the range to $7.10-$8.50 per bushel due to lower-than-expected early season cash and futures prices.
 
Reduced production and beginning stocks leave world coarse grain supplies for 2012/13 projected down 11.0 million tons this month to the lowest level since 2007/08. However, foreign corn supplies in 2012/13 are projected to be record high at 673.5 million tons. Brazil’s corn exports for trade year 2012/13 are raised over 30 percent this month to a record 19.0 million tons, supporting an increase in forecast corn trade and a sharp reduction in U.S. exports to the lowest level in almost 40 years.
 


Domestic Outlook

Forecast Corn Carryout Stocks for 2012/13 Slip
 
The September 28 Grain Stocks report indicates September 1, 2012, U.S. corn stocks of 988 million bushels, the lowest carryout since 1995/96, and 193 million bushels below September’s WASDE forecast. The stocks data and nearly final data for other domestic use imply a fourth-quarter feed and residual use of 335 million bushels, 115 million below estimates from the fourth quarter of 2010/11.
 
U.S. feed grain production for 2012/13 is forecast at 284.1 million metric tons, down from last month’s forecast of 284.5 million. The month-to-month decrease reflects reduced forecast production for corn and smaller production estimates for barley and oats from the Small Grains 2012 Summary report. Planted area for the four feed grains is increased 542,000 acres, and harvested-for-grain acres are increased 208,000 acres this month. Yields per harvested acre for the four grains combined are down slightly at 2.93 tons per acre. Beginning stocks in 2012/13 are lowered to 27.8 million tons, based on the recent Grain Stocks report. Total 2012/13 feed grain supply is forecast at 315.8 million tons, down 5.6 million from last month and down relative to the 2011/12 estimate of 358.5 million tons.
 
Total 2012/13 feed grain utilization is projected at 297.0 million tons, down from the September forecast of 300.1 million and down from the 2011/12 estimate of 330.7 million tons. The month-to-month decline is attributed to lower corn exports. Total projected feed grain ending stocks for 2012/13 are lowered 2.5 million tons to 18.8 million, mainly reflecting reduced carryin from the 2011/12 marketing year.
 


Feed Use
 
On a September-August marketing year basis for 2012/13, U.S. feed and residual use for the four feed grains plus wheat is projected to total 114.0 million tons, down 17.2 million from the revised total of 131.2 million tons in 2011. Corn is estimated to account for 92 percent of feed and residual use in 2012/13, down from 93 percent in 2011/12. The projected index of grain-consuming animal units (GCAU) in 2012/13 is 91.6 million units, down slightly from 92.6 million in 2011/12. Feed and residual per GCAU in 2012/13 is estimated at 1.24 tons, down from 1.42 tons in 2011/12. In the index components, GCAUs are decreased for beef, dairy, pork, and poultry.
 
USDA’s September 19 Milk Production report indicates that milk production in the 23 major producing States during August totaled 15.3 billion pounds, down 0.2 percent from August 2011. Production per cow averaged 1,803 pounds for August, 10 pounds below last year, primarily due to higher temperatures. The 2012 milk production forecast is reduced from last month, as slower growth in milk per cow more than offsets a slower expected decline in cow numbers. Higher forecast milk prices in late 2012 and into 2013 are expected to slow the rate of decline in cow numbers and help support higher growth in milk per cow in 2013.
 
U.S. inventory of all hogs and pigs on September 1, 2012, was 67.5 million head. This is up slightly from September 1, 2011, and up 3 percent from June 1, 2012. U.S. hog breeding inventory in the third quarter of 2012 is estimated at 5.79 million head, down slightly from both last year and the previous month, according to the September 28 Quarterly Hogs and Pigs report. Market hog inventory, at 61.7 million head, is up slightly from last year and up 3 percent from last quarter. The June-August 2012 pig crop, at 29.3 million head, was down slightly from 2011. Sows farrowing during this period totaled 2.89 million head, down 1 percent from 2011. The sows farrowed during this quarter represented 49 percent of the breeding herd. The average pigs saved per litter was a record high of 10.13 for the June- August period, compared to 10.03 last year. Pigs saved per litter by size of operation ranged from 7.60 for operations with 1-99 hogs and pigs to 10.20 for operations with more than 5,000 hogs and pigs. The recent Quarterly Hogs and Pigs report estimated a small decline in the June-August pig crop and indicates that producers intend to reduce farrowings through early 2013, but continued growth in pigs per litter is expected to mitigate much of the decline in farrowings.
 
The forecast for 2013 poultry production is raised slightly. USDA’s October 3 Broiler Hatchery report indicates that broiler-type egg sets have increased from a year earlier. Broiler-type chicks placed are up slightly to 154 million chicks for meat production. Cumulative placements from January 1, 2012, through September 29, 2012, are 6.37 billion, down 2 percent from the same period a year earlier.
 
According to the September 21, 2012, Chickens and Eggs report, broiler-type chicks hatched during August 2012 totaled 758 million and were down slightly from August 2011. Eggs in incubators totaled 596 million on September 1, 2012, down 1 percent from a year earlier. Leading breeders placed 7.05 million broiler- type pullet chicks for future domestic hatchery supply flocks during August 2012, down 3 percent from August 2011. Egg-type chicks hatched and pullet chicks for future hatchery supply have been increasing.
 
USDA’s September 14 Turkey Hatchery report indicates that turkey eggs in incubators on September 1, 2012, in the United States totaled 26.3 million, down 6 percent from September 1, 2011. Eggs in incubators were down 9 percent from the August 1, 2012, total of 28.9 million eggs. Turkey poults hatched during August 2012 in the United States totaled 23.8 million, down slightly from August 2011. Poults hatched were down 9 percent from the July 2012 total of 26.2 million poults.
 
USDA’s September 23 Cattle on Feed report indicated that cattle and calves on feed for slaughter market in the United States (feedlots with capacity of 1,000 or more head) totaled 10.6 million head on September 1, 2012. The inventory was 1 percent below the September 1, 2011, estimate. Placements in feedlots during August totaled 2 million, 11 percent below 2011. This is the second lowest cattle placement for the month of August since the series began in 1996. Net placements were 1.94 million head. During August, placements of cattle and calves weighing less than 600 pounds were 482,000, 600-699 pounds were 385,000, 700-799 pounds were 475,000, and 800 pounds and greater were 660,000.
 
Marketings of fed cattle during August totaled 1.96 million, 5 percent below 2011. Other disappearance totaled 61,000 during August, 15 percent below 2011.
 
Changes Made for the 2011/12 Marketing Year
 
The following changes were made in the 2011/12 balance sheets:

Corn: Feed and residual use is increased by 161.7 million bushels on lower ending stocks based on the September 1 stock estimates. Food, seed, and industrial use is increased by 31.0 million bushels on higher high-fructose corn syrup, starch, and glucose and dextrose production and adjustments in seed use.
 
Sorghum: Feed and residual use advanced by 5.6 million bushels on a 4.1-million- bushel reduction in ending stocks. Imports are raised slightly and exports are reduced.
 
Barley: A June 1 stock revision from the September 28 Grain Stocks report reduces ending stocks 78,000 bushels, resulting in an offsetting increase in feed and residual to an estimated 37.6 million bushels.
 
Oats: Feed and residual use is increased slightly to 81.9 based on revised June 1 stocks. Ending stocks are decreased 13,000 bushels.
 
2012/13 Corn Crop Slips on Lower Yield as Harvested Acreage Edges Up
 
U.S. corn production is forecast at 10,706 million bushels for 2012/13, down 22 million bushels from last month. From the previous month’s forecast, yield slips 0.8 bushels per acre to 122.0 bushels. The October 1 corn objective yield data indicate reduced ears per acre compared with last year’s record high for the combined 10 objective yield States: Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin. Forecast harvested acreage is boosted by 360,000 acres to 87.7 million. If the forecast production is realized, it would be the eighth largest on record.
 




Beginning stocks are lowered to 988 million bushels, 193 million lower than last month based on reported September 1 stocks. Exports are projected 100 million bushels lower at 1,150 million as a result of tight supplies and increased export competition, especially from Brazil. Corn used for ethanol production in 2012/13 is unchanged this month at 4,500 million bushels, based on anticipated fuel demand, tight corn supplies, and prospects for ethanol imports. Total utilization is projected at 11,150 million bushels, down 100 million from last month and 1,376 million below 2011/12.
 
Ending stocks are reduced sharply this month by 114 million bushels. At a projected 619 million bushels, 2012/13 ending stocks would be the lowest since 1995/96, when ending stocks were estimated at just 426 million bushels. The 2012/13 forecast price is reduced 10 cents on both ends of the range to $7.10-$8.50 per bushel, primarily due to declining early-season cash and futures prices. These price forecasts are still far above the record 2011/12 final price estimate of $6.22 per bushel.
 
Sorghum Production Nearly Unchanged
 
An increase in the forecast sorghum yield resulted in a production forecast of 252.0 million bushels, up 6.0 million bushels from last month. Forecast production is 37.5 million bushels higher than last season’s harvest of 214.4 million bushels. After a record-low harvest last year, 2012/13 harvest is still below-average and the second lowest since 2006 when 276.8 million bushels were harvested.
 




Based on October 1 conditions, the sorghum yield estimate were decreased 1.9 bushels per acre to 50.2 bushels per acre. Yields are expected to be 4.4 bushels per acre lower than last season due to the persistent drought in many southern sorghum growing areas, including Missouri, Kansas, Nebraska , and Texas.
 
Sorghum use is unchanged from last month’s forecast. The increase in production results in a 1.9-million-bushel increase in projected ending stocks.
 
Average U.S. sorghum farm price is lowered $0.10 on each end of the range to $6.70-$8.10 per bushel, in line with this month’s reduction in the projected corn farm price. This compares with a final estimated price of $5.99 per bushel for sorghum in 2011/12.
 
Barley Imports and Feed and Residual Reduced
 
U.S. barley production for 2012/13 is forecast at 220.3 million bushels, reflecting a slight downward revision of 735,000 bushels based on the final production estimate from the September 28 Small Grains 2012 Summary. Production is up 64.5 million bushels from 2011/12. Significant production increases from North Dakota, Idaho, and Montana all contribute to the 41-percent increase in production. Average yield per acre is down slightly to 67.9 bushels per acre, compared to the 2011/12 yield of 69.6. Approximately 3.64 million acres were planted for 2012/13, up 42 percent from 2011/12. Similarly, harvested acres for the 2012/13 marketing year are forecast to be up 45 percent to 3.24 million acres.
 




Total barley supply is projected at 300.3 million bushels, a decline of 5.8 million bushels from the September forecast but an increase of 38.9 million bushels over the 2011/12 supply estimate. Barley imports are down 5 million bushels from last month’s projection of 25 million bushels and are attributable, in part, to a decline in Canadian barley production.
 
Estimated barley feed and residual use is lowered to 55.0 million bushels, a cut of 25 million bushels, relative to last month, due to sluggish use revealed by the September 1 stocks. Export prospects remain unchanged. Projected ending stocks for 2012/13 are increased 19.2 million bushels to 80.3 million. Sustained demand for malting barley supports a slight increase in the farm price projection for all barley to $6.00-$7.00 per bushel. This compares to an average farm price of $5.35 per bushel in 2011/12.
 
Oats Production up 19 Percent in 2012/13
 
U.S. production of oats for 2012/13 is up 19 percent to 64.0 million bushels following a record-low harvest of 53.6 million bushels in 2011/12. Production gains are attributable to improved yields, with the 2012/13 yield estimated at 61.3 bushels per acre relative to 57.1 bushels in 2011/12. Planted and harvested acres are both up 11 percent over the previous year. Area planted to oats is estimated at 2.76 million acres, up slightly from last month and up 264,000 acres on the year. The largest gains in harvested area are attributed to Minnesota and North Dakota where, collectively, an additional 50,000 acres of oats are expected to be harvested. Harvested acre estimates were lowered slightly this month to 1.045 million acres, down 46,000 acres from the previous forecast.
 




No changes to projected import and export levels were made. Ending stocks for both 2011/12 and 2012/13 were revised downward slightly to 55.0 and 50.01 million bushels, respectively. The projected 2012/13 farm price range is unchanged at $3.40-$4.20 per bushel, a slight increase over the final 2011/12 farm price of $3.49 per bushel.
 
Slight Increase in Alfalfa and Other Hay Production Estimates
 
U.S. all-hay production in 2012/13 is forecast at 121.97 million short tons, down from 131.14 million tons in 2011/12. Total harvested area for 2012/13, at 57.6 million acres, is up 3.5 percent from the 2011/12 estimate of 55.6 million acres. The increase in harvested acres is more than offset by declines in yields for other hay and alfalfa hay and mixtures. Roughage-consuming animal units (RCAU) are projected to be 67.07 in 2012/13, down from 67.91 in 2011/12. Despite reductions in RCAUs, the all-hay production decline results in a net drop in hay supply per RCAU of 0.12 tons to 2.14 tons per RCAU, compared to 2.26 tons per RCAU in 2011/12. In recognition of the need for additional hay, Conservation Reserve Program land will be open to grazing through November 2012.
 
Production of alfalfa hay and alfalfa mixtures is forecast at 55.57 million tons, up 1 percent from the August forecast but down 15 percent from last year. Based on October 1 conditions, the estimated yield is adjusted upward by a modest 0.03 tons per acre relative to the August forecast. The 2012/13 alfalfa hay and mixtures yield is forecast to be 2.95 tons per acre, a 0.45-ton-per-acre reduction in yield relative to the 2011/12 estimate of 3.40 tons per acre. If realized, the forecast yield will be the lowest since 1988. Harvested area is down 2 percent from the previous year at 18.8 million acres, with major declines attributed to Montana, Wisconsin, and Wyoming.
 
Other hay production is forecast at 66.4 million tons, an increase of 1 percent from both the August forecast and the previous year. Based on October 1 conditions, yields are expected to average 1.71 tons per acre, up 0.02 tons from August but down 0.10 tons from the previous year. Harvested area, at 38.8 million acres, is up more than 6 percent over the 2011/12 estimate of 36.4 million acres.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on October 20, 2012, 10:28:04 AM
International Outlook
 


Increased U.S. Coarse Grain Production Offsets Foreign Decline
 
Global coarse grain production in 2012/13 is forecast down 3.2 million tons this month to 1,110.1 million, with U.S. production down a relatively small 0.5 million tons and foreign barley and corn down by a larger amount. Foreign barley production is projected down 1.8 million tons to 126.0 million, with significant reductions for Australia and Canada. Foreign corn production prospects are cut 1.5 million tons to 567.1 million due to drought effects in the EU and Serbia. Foreign oats production is projected down 0.5 million tons to 20.5 million, mostly because of below-normal rains in Australia. Mixed grain production is trimmed 0.2 million tons to 14.9 million (and down 0.3 million to 14.4 for 2011/12) due to several EU harvest reports, and the largest declines are in Poland and France. However, 2012/13 foreign production prospects are boosted this month for sorghum (up 0.6 million tons to 53.1 million), rye (up 0.6 million to 13.7 million), and millet (up slightly to 30.7 million).
 
Australia had a dry winter across most grain areas, so September rainfall was crucial for spring grains entering reproduction. In Western Australia, good rains arrived in late September, but yield prospects had already been hurt. In Eastern Australia, September rainfall was spotty, with some areas receiving ample rains while others remained much drier than normal. Lower projected barley yields in Australia more than offset increased reported area, cutting forecast production 1.0 million tons to 7.0 million. Reduced oats area and lower yield prospects cut 2012/13 production 0.4 million tons to 1.2 million. However, increased area is expected for summer crops, boosting sorghum production 0.2 million tons to 2.7 million and corn production slightly to 0.4 million.
 
Canada suffered from dryness across much of the Prairies during August and September and high winds that damaged windrowed crops. Rainfall for corn in Ontario was uneven, with dryness to the north and East. Statistics Canada reported reduced yields, with barley production cut 0.9 million tons to 8.6 million, corn trimmed 0.1 million to 11.6 million, and oats reduced slightly to less than 3.0 million.
 
EU 2012/13 coarse grain production is forecast down 0.9 million tons this month to 141.0 million. Winter grain harvest is complete, and summer crop harvests are accelerated by hot dry summer growing conditions, especially across southern parts of the EU. Most countries are publishing harvest reports that verify production problems. EU corn production is forecast down 1.5 million tons to 55.6 million, with declines for Romania, Hungary, France, Bulgaria, Slovakia, and Greece and increases for Spain and Poland. EU mixed grain is forecast down 0.2 million tons to 14.5 million, with most of the reduction due to reduced area in Poland, and sorghum production is reduced slightly for France. Some of the northern EU countries had more rain this summer, and harvest reports indicate higher production of rye (up 0.6 million tons, mostly for Germany, Poland, and Denmark), barley (up 0.4 million, with increases for Spain, France, Poland, and Sweden more than offsetting reductions for several other countries), and oats (up slightly, with an increase for Sweden more than offsetting a decline for France). Serbia suffered from the same drought as its EU neighbors, with corn production forecast down 0.4 million tons to 3.9 million, and small reductions forecast for oats and barley.
 
Coarse grain production in Sub-Saharan Africa is up 1.0 million tons this month to 101.7 million as a review of production prospects across several countries revealed generally favorable rains, especially across the Sahel. There are increases in forecast 2012/13 production for Ethiopia, Malawi, Ghana, Chad, Mali, Angola, Zimbabwe, South Africa, Tanzania, Uganda, and Congo Brazzaville, but reductions for Madagascar, Kenya, Zambia, Sudan, Lesotho, Botswana, and Burundi.
 
There are small reductions to 2012/13 barley production this month reported for Algeria and Kyrgyzstan.
 
Reduced Beginning Stocks Tighten 2012/13 Supplies
 
World coarse grain beginning stocks for 2012/13 are forecast down 7.9 million tons this month to 164.8 million. While much of the decline is for U.S. corn stocks, foreign coarse grain stocks are down 2.9 million tons to 137.0 million.
 
Brazil’s corn beginning stocks for 2012/13 are reduced 4.5 million tons to 10.8 million as the record pace of exports in August and September, and strong sales for shipment in coming months, indicate that stocks on March 1, 2013 (the beginning of the 2012/13 local marketing year for corn) will be less than previously forecast. Other reductions to corn beginning stocks are much smaller, with declines for Malawi, the EU, Malaysia, and Zambia. Beginning stocks are forecast up 0.4 million tons each for Egypt (strong 2011/12 imports) and Zimbabwe (increased 2011/12 production and imports) and 0.2 million each for Angola, Tanzania, China, Venezuela, and Kenya.
 
Global sorghum 2012/13 beginning stocks are reduced 0.6 million tons to 3.7 million, with reductions of 0.1 million tons or more for Argentina, Australia, the United States, and Tanzania.
 
World barley beginning stocks are up 0.7 million tons to 22.6 million, mostly due to a 0.6-million-ton increase for Saudi Arabia caused by strong 2011/12 imports. China’s barley beginning stocks are also boosted by 2011/12 imports. World oats beginning stocks are down 0.3 million tons, mostly due to reductions for the EU and Australia, but rye stocks are up 0.4 million due to increases for the EU.
 
Reduced production and beginning stocks leave world coarse grain supplies for 2012/13 projected down 11.0 million tons this month to 1,274.9 million, the lowest level since 2007/08. However, foreign corn supplies in 2012/13 are projected to be record high at 673.5 million tons.
 
Tight Supplies and High Prices Reduce Projected Use
 
Global 2012/13 coarse grain use is projected down 4.4 million tons this month to 1,128.6 million, with most of the reduction, 3.9 million, in foreign countries. Global corn use is forecast down 3.4 million tons, with no U.S. consumption change. World barley use is projected down 1.5 million tons, with U.S. consumption reduced 0.5 million. World oats and mixed grain use are trimmed this month, but sorghum and millet are up slightly.
 
Coarse grain domestic consumption in Sub-Saharan Africa for 2012/13 is increased 1.0 million tons this month to 101.5 million, mostly due to increased production prospects in several countries. For many countries in the region, good domestic production will limit local price increases and support food use.
 
Australia’s coarse grain use is cut 0.75 million tons to 6.6 million, with most of the decline in barley feed use caused by reduced crop prospects. Canada faces a similar situation with coarse grain use reduced 0.6 million tons (to 20.6 million) due mostly to less expected barley feed use.
 
India’s forecast 2012/13 corn feed use is reduced 0.5 million tons to 9.0 million as recent data indicate more corn exports and less domestic feed use for both 2011/12 and 2012/13. Serbia’s 2012/13 corn domestic feed use is reduced 0.3 million tons to 3.6 million as trade data for 2011/12 indicate more exports. Increased exports will reduce domestic use with Serbia’s 2012 crop devastated by drought. While total 2012/13 coarse grain domestic use for Tanzania is trimmed 0.2 million tons this month, revisions to several years of consumption lower feed use but increase food use, projected up 0.6 million tons this month to 4.7 million for 2012/13. There are small reductions to expected 2012/13 coarse grain use this month for Argentina, Kenya, Malaysia, Sudan, Ukraine, and Zambia.
 
Barley consumption in Saudi Arabia for 2012/13 is expected up 0.5 million tons this month as strong imports at the end of 2011/12 boost supplies. Other non-Sub-Saharan African countries with smaller increases in projected 2012/13 coarse grain use include Venezuela, the EU, and Egypt.
 


Projected Global Ending Coarse Grain Stocks Cut This Month
 
World coarse grain ending stocks projected for 2012/13 are down 6.6 million tons this month to 146.3 million. This is the lowest in 6 years and the 3rd lowest in recent decades. Much of this month’s decline, 4.2 million tons, is in foreign countries, with foreign corn stocks down 3.8 million.
 
Brazil’s 2012/13 corn ending stocks are slashed 5.5 million tons to 9.6 million as attractive prices for exports are an incentive to ship instead of hold stocks. Moreover, Brazil harvests significant amounts of corn across nearly half the year (March to July), so it has flexibility when high prices overcome transportation costs.
 
Australia, with reduced barley production, is expected to hold 0.4 million tons less coarse grains (1.0 million). There are smaller reductions in forecast 2012/13 ending stocks for Zambia, Argentina, Malaysia, Russia, Algeria, Canada, and South Africa.
 
EU 2012/13 coarse grain ending stocks are projected up 0.6 million tons to 10.7 million, partly due to increased forecast corn imports. There are also increased ending stocks projected this month for Tanzania, Angola, Egypt, Zimbabwe, and some other countries.
 
U.S. Corn Export Prospects Cut, World Trade Boosted
 
Global corn trade projected for 2012/13 is increased 2.5 million tons this month to 93.3 million. Trade data for the recently completed (October-September) 2011/12 trade year are not nearly complete, but preliminary trade statistics indicate record-high corn trade at 102.8 million tons, up 2.5 million from last month’s forecast. Corn trade appears robust despite high prices.
 


EU corn imports are raised 2.0 million tons this month to 5.0 million as EU corn and UK wheat crops are reduced. A large part of the UK wheat crop is normally used for feed.
 
Venezuela’s 2012/13 corn imports are projected up 0.3 million tons to 2.0 million as large imports the previous year indicate strong demand. Zimbabwe’s 2012/13 corn imports are raised 0.1 million to 0.4 million because of strong demand and imports for 2011/12. However, Malaysia’s 2012/13 corn imports are trimmed 0.1 million tons to 3.0 million as 2011/12 imports were smaller than previously forecast. Serbia’s 2012/13 imports are raised slightly due to tight supplies caused by drought.
 
Brazil’s corn exports are boosted 4.5 million tons to a record 19.0 million, and Brazil is expected to be the world’s second largest corn exporter in 2012/13. Brazil reportedly shipped a record pace of corn exports in September 2012 of over 3 million tons, boosting estimated 2011/12 exports 0.7 million this month to 12.7 million. Brazil has demonstrated that without soybeans and products taking priority for ports and other transportation infrastructure, it can ship very large volumes of corn if prices are attractive. From October 2012 to February 2013, Brazil is expected to ship large volumes of corn, with a secondary increase in August and September 2013 if soybean shipments tail off or transportation bottlenecks are reduced.
 
India’s 2012/13 corn exports are forecast up 0.5 million tons this month to 3.0 million. The pace of recent shipments indicates India will export corn if foreign prices are attractive (2011/12 corn exports are raised 0.6 million tons this month to 4.4 million).
 
Facing strong competition from Brazil and other exporters, U.S. corn export prospects for 2012/13 are weakening. At the end of September 2012, outstanding sales of corn were 8.3 million tons, down 6.0 million from the previous year, when corn exports were sluggish. U.S. 2012/13 corn exports are projected down 2.5 million tons this month to 31.0 million, the lowest in almost 40 years (the September-August local marketing year is cut 100 million bushels to 1.15 billion bushels).
 October 2012
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on October 28, 2012, 04:55:15 AM
USDA Feed Outlook

Reports» USDA Feed Outlook» USDA Feed Outlook - October 2012

16 October 2012
USDA Feed Outlook - October 2012
U.S. corn production for 2012/13 is lowered 21 million bushels as lower yield more than offsets higher area in this month’s forecasts.


 

Smaller Carryin and Forecast Production Tighten Corn Ending Stocks for 2012/13
 
The yield slips 0.8 bushels per acre to 122.0 bushels, and harvested area advances 0.4 million acres to 87.7 million. Corn supplies for 2012/13 are projected 214 million bushels lower, mostly reflecting lower carryin based on September 1 stocks. Projected exports are reduced 100 million bushels. Corn ending stocks for 2012/13 are projected 114 million bushels lower at 619 million. The projected average price received by growers is reduced 10 cents on each end of the range to $7.10-$8.50 per bushel due to lower-than-expected early season cash and futures prices.
 
Reduced production and beginning stocks leave world coarse grain supplies for 2012/13 projected down 11.0 million tons this month to the lowest level since 2007/08. However, foreign corn supplies in 2012/13 are projected to be record high at 673.5 million tons. Brazil’s corn exports for trade year 2012/13 are raised over 30 percent this month to a record 19.0 million tons, supporting an increase in forecast corn trade and a sharp reduction in U.S. exports to the lowest level in almost 40 years.
 


Domestic Outlook

Forecast Corn Carryout Stocks for 2012/13 Slip
 
The September 28 Grain Stocks report indicates September 1, 2012, U.S. corn stocks of 988 million bushels, the lowest carryout since 1995/96, and 193 million bushels below September’s WASDE forecast. The stocks data and nearly final data for other domestic use imply a fourth-quarter feed and residual use of 335 million bushels, 115 million below estimates from the fourth quarter of 2010/11.
 
U.S. feed grain production for 2012/13 is forecast at 284.1 million metric tons, down from last month’s forecast of 284.5 million. The month-to-month decrease reflects reduced forecast production for corn and smaller production estimates for barley and oats from the Small Grains 2012 Summary report. Planted area for the four feed grains is increased 542,000 acres, and harvested-for-grain acres are increased 208,000 acres this month. Yields per harvested acre for the four grains combined are down slightly at 2.93 tons per acre. Beginning stocks in 2012/13 are lowered to 27.8 million tons, based on the recent Grain Stocks report. Total 2012/13 feed grain supply is forecast at 315.8 million tons, down 5.6 million from last month and down relative to the 2011/12 estimate of 358.5 million tons.
 
Total 2012/13 feed grain utilization is projected at 297.0 million tons, down from the September forecast of 300.1 million and down from the 2011/12 estimate of 330.7 million tons. The month-to-month decline is attributed to lower corn exports. Total projected feed grain ending stocks for 2012/13 are lowered 2.5 million tons to 18.8 million, mainly reflecting reduced carryin from the 2011/12 marketing year.
 


Feed Use
 
On a September-August marketing year basis for 2012/13, U.S. feed and residual use for the four feed grains plus wheat is projected to total 114.0 million tons, down 17.2 million from the revised total of 131.2 million tons in 2011. Corn is estimated to account for 92 percent of feed and residual use in 2012/13, down from 93 percent in 2011/12. The projected index of grain-consuming animal units (GCAU) in 2012/13 is 91.6 million units, down slightly from 92.6 million in 2011/12. Feed and residual per GCAU in 2012/13 is estimated at 1.24 tons, down from 1.42 tons in 2011/12. In the index components, GCAUs are decreased for beef, dairy, pork, and poultry.
 
USDA’s September 19 Milk Production report indicates that milk production in the 23 major producing States during August totaled 15.3 billion pounds, down 0.2 percent from August 2011. Production per cow averaged 1,803 pounds for August, 10 pounds below last year, primarily due to higher temperatures. The 2012 milk production forecast is reduced from last month, as slower growth in milk per cow more than offsets a slower expected decline in cow numbers. Higher forecast milk prices in late 2012 and into 2013 are expected to slow the rate of decline in cow numbers and help support higher growth in milk per cow in 2013.
 
U.S. inventory of all hogs and pigs on September 1, 2012, was 67.5 million head. This is up slightly from September 1, 2011, and up 3 percent from June 1, 2012. U.S. hog breeding inventory in the third quarter of 2012 is estimated at 5.79 million head, down slightly from both last year and the previous month, according to the September 28 Quarterly Hogs and Pigs report. Market hog inventory, at 61.7 million head, is up slightly from last year and up 3 percent from last quarter. The June-August 2012 pig crop, at 29.3 million head, was down slightly from 2011. Sows farrowing during this period totaled 2.89 million head, down 1 percent from 2011. The sows farrowed during this quarter represented 49 percent of the breeding herd. The average pigs saved per litter was a record high of 10.13 for the June- August period, compared to 10.03 last year. Pigs saved per litter by size of operation ranged from 7.60 for operations with 1-99 hogs and pigs to 10.20 for operations with more than 5,000 hogs and pigs. The recent Quarterly Hogs and Pigs report estimated a small decline in the June-August pig crop and indicates that producers intend to reduce farrowings through early 2013, but continued growth in pigs per litter is expected to mitigate much of the decline in farrowings.
 
The forecast for 2013 poultry production is raised slightly. USDA’s October 3 Broiler Hatchery report indicates that broiler-type egg sets have increased from a year earlier. Broiler-type chicks placed are up slightly to 154 million chicks for meat production. Cumulative placements from January 1, 2012, through September 29, 2012, are 6.37 billion, down 2 percent from the same period a year earlier.
 
According to the September 21, 2012, Chickens and Eggs report, broiler-type chicks hatched during August 2012 totaled 758 million and were down slightly from August 2011. Eggs in incubators totaled 596 million on September 1, 2012, down 1 percent from a year earlier. Leading breeders placed 7.05 million broiler- type pullet chicks for future domestic hatchery supply flocks during August 2012, down 3 percent from August 2011. Egg-type chicks hatched and pullet chicks for future hatchery supply have been increasing.
 
USDA’s September 14 Turkey Hatchery report indicates that turkey eggs in incubators on September 1, 2012, in the United States totaled 26.3 million, down 6 percent from September 1, 2011. Eggs in incubators were down 9 percent from the August 1, 2012, total of 28.9 million eggs. Turkey poults hatched during August 2012 in the United States totaled 23.8 million, down slightly from August 2011. Poults hatched were down 9 percent from the July 2012 total of 26.2 million poults.
 
USDA’s September 23 Cattle on Feed report indicated that cattle and calves on feed for slaughter market in the United States (feedlots with capacity of 1,000 or more head) totaled 10.6 million head on September 1, 2012. The inventory was 1 percent below the September 1, 2011, estimate. Placements in feedlots during August totaled 2 million, 11 percent below 2011. This is the second lowest cattle placement for the month of August since the series began in 1996. Net placements were 1.94 million head. During August, placements of cattle and calves weighing less than 600 pounds were 482,000, 600-699 pounds were 385,000, 700-799 pounds were 475,000, and 800 pounds and greater were 660,000.
 
Marketings of fed cattle during August totaled 1.96 million, 5 percent below 2011. Other disappearance totaled 61,000 during August, 15 percent below 2011.
 
Changes Made for the 2011/12 Marketing Year
 
The following changes were made in the 2011/12 balance sheets:

Corn: Feed and residual use is increased by 161.7 million bushels on lower ending stocks based on the September 1 stock estimates. Food, seed, and industrial use is increased by 31.0 million bushels on higher high-fructose corn syrup, starch, and glucose and dextrose production and adjustments in seed use.
 
Sorghum: Feed and residual use advanced by 5.6 million bushels on a 4.1-million- bushel reduction in ending stocks. Imports are raised slightly and exports are reduced.
 
Barley: A June 1 stock revision from the September 28 Grain Stocks report reduces ending stocks 78,000 bushels, resulting in an offsetting increase in feed and residual to an estimated 37.6 million bushels.
 
Oats: Feed and residual use is increased slightly to 81.9 based on revised June 1 stocks. Ending stocks are decreased 13,000 bushels.
 
2012/13 Corn Crop Slips on Lower Yield as Harvested Acreage Edges Up
 
U.S. corn production is forecast at 10,706 million bushels for 2012/13, down 22 million bushels from last month. From the previous month’s forecast, yield slips 0.8 bushels per acre to 122.0 bushels. The October 1 corn objective yield data indicate reduced ears per acre compared with last year’s record high for the combined 10 objective yield States: Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin. Forecast harvested acreage is boosted by 360,000 acres to 87.7 million. If the forecast production is realized, it would be the eighth largest on record.
 




Beginning stocks are lowered to 988 million bushels, 193 million lower than last month based on reported September 1 stocks. Exports are projected 100 million bushels lower at 1,150 million as a result of tight supplies and increased export competition, especially from Brazil. Corn used for ethanol production in 2012/13 is unchanged this month at 4,500 million bushels, based on anticipated fuel demand, tight corn supplies, and prospects for ethanol imports. Total utilization is projected at 11,150 million bushels, down 100 million from last month and 1,376 million below 2011/12.
 
Ending stocks are reduced sharply this month by 114 million bushels. At a projected 619 million bushels, 2012/13 ending stocks would be the lowest since 1995/96, when ending stocks were estimated at just 426 million bushels. The 2012/13 forecast price is reduced 10 cents on both ends of the range to $7.10-$8.50 per bushel, primarily due to declining early-season cash and futures prices. These price forecasts are still far above the record 2011/12 final price estimate of $6.22 per bushel.
 
Sorghum Production Nearly Unchanged
 
An increase in the forecast sorghum yield resulted in a production forecast of 252.0 million bushels, up 6.0 million bushels from last month. Forecast production is 37.5 million bushels higher than last season’s harvest of 214.4 million bushels. After a record-low harvest last year, 2012/13 harvest is still below-average and the second lowest since 2006 when 276.8 million bushels were harvested.
 




Based on October 1 conditions, the sorghum yield estimate were decreased 1.9 bushels per acre to 50.2 bushels per acre. Yields are expected to be 4.4 bushels per acre lower than last season due to the persistent drought in many southern sorghum growing areas, including Missouri, Kansas, Nebraska , and Texas.
 
Sorghum use is unchanged from last month’s forecast. The increase in production results in a 1.9-million-bushel increase in projected ending stocks.
 
Average U.S. sorghum farm price is lowered $0.10 on each end of the range to $6.70-$8.10 per bushel, in line with this month’s reduction in the projected corn farm price. This compares with a final estimated price of $5.99 per bushel for sorghum in 2011/12.
 
Barley Imports and Feed and Residual Reduced
 
U.S. barley production for 2012/13 is forecast at 220.3 million bushels, reflecting a slight downward revision of 735,000 bushels based on the final production estimate from the September 28 Small Grains 2012 Summary. Production is up 64.5 million bushels from 2011/12. Significant production increases from North Dakota, Idaho, and Montana all contribute to the 41-percent increase in production. Average yield per acre is down slightly to 67.9 bushels per acre, compared to the 2011/12 yield of 69.6. Approximately 3.64 million acres were planted for 2012/13, up 42 percent from 2011/12. Similarly, harvested acres for the 2012/13 marketing year are forecast to be up 45 percent to 3.24 million acres.
 




Total barley supply is projected at 300.3 million bushels, a decline of 5.8 million bushels from the September forecast but an increase of 38.9 million bushels over the 2011/12 supply estimate. Barley imports are down 5 million bushels from last month’s projection of 25 million bushels and are attributable, in part, to a decline in Canadian barley production.
 
Estimated barley feed and residual use is lowered to 55.0 million bushels, a cut of 25 million bushels, relative to last month, due to sluggish use revealed by the September 1 stocks. Export prospects remain unchanged. Projected ending stocks for 2012/13 are increased 19.2 million bushels to 80.3 million. Sustained demand for malting barley supports a slight increase in the farm price projection for all barley to $6.00-$7.00 per bushel. This compares to an average farm price of $5.35 per bushel in 2011/12.
 
Oats Production up 19 Percent in 2012/13
 
U.S. production of oats for 2012/13 is up 19 percent to 64.0 million bushels following a record-low harvest of 53.6 million bushels in 2011/12. Production gains are attributable to improved yields, with the 2012/13 yield estimated at 61.3 bushels per acre relative to 57.1 bushels in 2011/12. Planted and harvested acres are both up 11 percent over the previous year. Area planted to oats is estimated at 2.76 million acres, up slightly from last month and up 264,000 acres on the year. The largest gains in harvested area are attributed to Minnesota and North Dakota where, collectively, an additional 50,000 acres of oats are expected to be harvested. Harvested acre estimates were lowered slightly this month to 1.045 million acres, down 46,000 acres from the previous forecast.
 




No changes to projected import and export levels were made. Ending stocks for both 2011/12 and 2012/13 were revised downward slightly to 55.0 and 50.01 million bushels, respectively. The projected 2012/13 farm price range is unchanged at $3.40-$4.20 per bushel, a slight increase over the final 2011/12 farm price of $3.49 per bushel.
 
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on October 28, 2012, 04:56:00 AM
Slight Increase in Alfalfa and Other Hay Production Estimates
 
U.S. all-hay production in 2012/13 is forecast at 121.97 million short tons, down from 131.14 million tons in 2011/12. Total harvested area for 2012/13, at 57.6 million acres, is up 3.5 percent from the 2011/12 estimate of 55.6 million acres. The increase in harvested acres is more than offset by declines in yields for other hay and alfalfa hay and mixtures. Roughage-consuming animal units (RCAU) are projected to be 67.07 in 2012/13, down from 67.91 in 2011/12. Despite reductions in RCAUs, the all-hay production decline results in a net drop in hay supply per RCAU of 0.12 tons to 2.14 tons per RCAU, compared to 2.26 tons per RCAU in 2011/12. In recognition of the need for additional hay, Conservation Reserve Program land will be open to grazing through November 2012.
 
Production of alfalfa hay and alfalfa mixtures is forecast at 55.57 million tons, up 1 percent from the August forecast but down 15 percent from last year. Based on October 1 conditions, the estimated yield is adjusted upward by a modest 0.03 tons per acre relative to the August forecast. The 2012/13 alfalfa hay and mixtures yield is forecast to be 2.95 tons per acre, a 0.45-ton-per-acre reduction in yield relative to the 2011/12 estimate of 3.40 tons per acre. If realized, the forecast yield will be the lowest since 1988. Harvested area is down 2 percent from the previous year at 18.8 million acres, with major declines attributed to Montana, Wisconsin, and Wyoming.
 
Other hay production is forecast at 66.4 million tons, an increase of 1 percent from both the August forecast and the previous year. Based on October 1 conditions, yields are expected to average 1.71 tons per acre, up 0.02 tons from August but down 0.10 tons from the previous year. Harvested area, at 38.8 million acres, is up more than 6 percent over the 2011/12 estimate of 36.4 million acres.
 


International Outlook
 


Increased U.S. Coarse Grain Production Offsets Foreign Decline
 
Global coarse grain production in 2012/13 is forecast down 3.2 million tons this month to 1,110.1 million, with U.S. production down a relatively small 0.5 million tons and foreign barley and corn down by a larger amount. Foreign barley production is projected down 1.8 million tons to 126.0 million, with significant reductions for Australia and Canada. Foreign corn production prospects are cut 1.5 million tons to 567.1 million due to drought effects in the EU and Serbia. Foreign oats production is projected down 0.5 million tons to 20.5 million, mostly because of below-normal rains in Australia. Mixed grain production is trimmed 0.2 million tons to 14.9 million (and down 0.3 million to 14.4 for 2011/12) due to several EU harvest reports, and the largest declines are in Poland and France. However, 2012/13 foreign production prospects are boosted this month for sorghum (up 0.6 million tons to 53.1 million), rye (up 0.6 million to 13.7 million), and millet (up slightly to 30.7 million).
 
Australia had a dry winter across most grain areas, so September rainfall was crucial for spring grains entering reproduction. In Western Australia, good rains arrived in late September, but yield prospects had already been hurt. In Eastern Australia, September rainfall was spotty, with some areas receiving ample rains while others remained much drier than normal. Lower projected barley yields in Australia more than offset increased reported area, cutting forecast production 1.0 million tons to 7.0 million. Reduced oats area and lower yield prospects cut 2012/13 production 0.4 million tons to 1.2 million. However, increased area is expected for summer crops, boosting sorghum production 0.2 million tons to 2.7 million and corn production slightly to 0.4 million.
 
Canada suffered from dryness across much of the Prairies during August and September and high winds that damaged windrowed crops. Rainfall for corn in Ontario was uneven, with dryness to the north and East. Statistics Canada reported reduced yields, with barley production cut 0.9 million tons to 8.6 million, corn trimmed 0.1 million to 11.6 million, and oats reduced slightly to less than 3.0 million.
 
EU 2012/13 coarse grain production is forecast down 0.9 million tons this month to 141.0 million. Winter grain harvest is complete, and summer crop harvests are accelerated by hot dry summer growing conditions, especially across southern parts of the EU. Most countries are publishing harvest reports that verify production problems. EU corn production is forecast down 1.5 million tons to 55.6 million, with declines for Romania, Hungary, France, Bulgaria, Slovakia, and Greece and increases for Spain and Poland. EU mixed grain is forecast down 0.2 million tons to 14.5 million, with most of the reduction due to reduced area in Poland, and sorghum production is reduced slightly for France. Some of the northern EU countries had more rain this summer, and harvest reports indicate higher production of rye (up 0.6 million tons, mostly for Germany, Poland, and Denmark), barley (up 0.4 million, with increases for Spain, France, Poland, and Sweden more than offsetting reductions for several other countries), and oats (up slightly, with an increase for Sweden more than offsetting a decline for France). Serbia suffered from the same drought as its EU neighbors, with corn production forecast down 0.4 million tons to 3.9 million, and small reductions forecast for oats and barley.
 
Coarse grain production in Sub-Saharan Africa is up 1.0 million tons this month to 101.7 million as a review of production prospects across several countries revealed generally favorable rains, especially across the Sahel. There are increases in forecast 2012/13 production for Ethiopia, Malawi, Ghana, Chad, Mali, Angola, Zimbabwe, South Africa, Tanzania, Uganda, and Congo Brazzaville, but reductions for Madagascar, Kenya, Zambia, Sudan, Lesotho, Botswana, and Burundi.
 
There are small reductions to 2012/13 barley production this month reported for Algeria and Kyrgyzstan.
 
Reduced Beginning Stocks Tighten 2012/13 Supplies
 
World coarse grain beginning stocks for 2012/13 are forecast down 7.9 million tons this month to 164.8 million. While much of the decline is for U.S. corn stocks, foreign coarse grain stocks are down 2.9 million tons to 137.0 million.
 
Brazil’s corn beginning stocks for 2012/13 are reduced 4.5 million tons to 10.8 million as the record pace of exports in August and September, and strong sales for shipment in coming months, indicate that stocks on March 1, 2013 (the beginning of the 2012/13 local marketing year for corn) will be less than previously forecast. Other reductions to corn beginning stocks are much smaller, with declines for Malawi, the EU, Malaysia, and Zambia. Beginning stocks are forecast up 0.4 million tons each for Egypt (strong 2011/12 imports) and Zimbabwe (increased 2011/12 production and imports) and 0.2 million each for Angola, Tanzania, China, Venezuela, and Kenya.
 
Global sorghum 2012/13 beginning stocks are reduced 0.6 million tons to 3.7 million, with reductions of 0.1 million tons or more for Argentina, Australia, the United States, and Tanzania.
 
World barley beginning stocks are up 0.7 million tons to 22.6 million, mostly due to a 0.6-million-ton increase for Saudi Arabia caused by strong 2011/12 imports. China’s barley beginning stocks are also boosted by 2011/12 imports. World oats beginning stocks are down 0.3 million tons, mostly due to reductions for the EU and Australia, but rye stocks are up 0.4 million due to increases for the EU.
 
Reduced production and beginning stocks leave world coarse grain supplies for 2012/13 projected down 11.0 million tons this month to 1,274.9 million, the lowest level since 2007/08. However, foreign corn supplies in 2012/13 are projected to be record high at 673.5 million tons.
 
Tight Supplies and High Prices Reduce Projected Use
 
Global 2012/13 coarse grain use is projected down 4.4 million tons this month to 1,128.6 million, with most of the reduction, 3.9 million, in foreign countries. Global corn use is forecast down 3.4 million tons, with no U.S. consumption change. World barley use is projected down 1.5 million tons, with U.S. consumption reduced 0.5 million. World oats and mixed grain use are trimmed this month, but sorghum and millet are up slightly.
 
Coarse grain domestic consumption in Sub-Saharan Africa for 2012/13 is increased 1.0 million tons this month to 101.5 million, mostly due to increased production prospects in several countries. For many countries in the region, good domestic production will limit local price increases and support food use.
 
Australia’s coarse grain use is cut 0.75 million tons to 6.6 million, with most of the decline in barley feed use caused by reduced crop prospects. Canada faces a similar situation with coarse grain use reduced 0.6 million tons (to 20.6 million) due mostly to less expected barley feed use.
 
India’s forecast 2012/13 corn feed use is reduced 0.5 million tons to 9.0 million as recent data indicate more corn exports and less domestic feed use for both 2011/12 and 2012/13. Serbia’s 2012/13 corn domestic feed use is reduced 0.3 million tons to 3.6 million as trade data for 2011/12 indicate more exports. Increased exports will reduce domestic use with Serbia’s 2012 crop devastated by drought. While total 2012/13 coarse grain domestic use for Tanzania is trimmed 0.2 million tons this month, revisions to several years of consumption lower feed use but increase food use, projected up 0.6 million tons this month to 4.7 million for 2012/13. There are small reductions to expected 2012/13 coarse grain use this month for Argentina, Kenya, Malaysia, Sudan, Ukraine, and Zambia.
 
Barley consumption in Saudi Arabia for 2012/13 is expected up 0.5 million tons this month as strong imports at the end of 2011/12 boost supplies. Other non-Sub-Saharan African countries with smaller increases in projected 2012/13 coarse grain use include Venezuela, the EU, and Egypt.
 


Projected Global Ending Coarse Grain Stocks Cut This Month
 
World coarse grain ending stocks projected for 2012/13 are down 6.6 million tons this month to 146.3 million. This is the lowest in 6 years and the 3rd lowest in recent decades. Much of this month’s decline, 4.2 million tons, is in foreign countries, with foreign corn stocks down 3.8 million.
 
Brazil’s 2012/13 corn ending stocks are slashed 5.5 million tons to 9.6 million as attractive prices for exports are an incentive to ship instead of hold stocks. Moreover, Brazil harvests significant amounts of corn across nearly half the year (March to July), so it has flexibility when high prices overcome transportation costs.
 
Australia, with reduced barley production, is expected to hold 0.4 million tons less coarse grains (1.0 million). There are smaller reductions in forecast 2012/13 ending stocks for Zambia, Argentina, Malaysia, Russia, Algeria, Canada, and South Africa.
 
EU 2012/13 coarse grain ending stocks are projected up 0.6 million tons to 10.7 million, partly due to increased forecast corn imports. There are also increased ending stocks projected this month for Tanzania, Angola, Egypt, Zimbabwe, and some other countries.
 
U.S. Corn Export Prospects Cut, World Trade Boosted
 
Global corn trade projected for 2012/13 is increased 2.5 million tons this month to 93.3 million. Trade data for the recently completed (October-September) 2011/12 trade year are not nearly complete, but preliminary trade statistics indicate record-high corn trade at 102.8 million tons, up 2.5 million from last month’s forecast. Corn trade appears robust despite high prices.
 


EU corn imports are raised 2.0 million tons this month to 5.0 million as EU corn and UK wheat crops are reduced. A large part of the UK wheat crop is normally used for feed.
 
Venezuela’s 2012/13 corn imports are projected up 0.3 million tons to 2.0 million as large imports the previous year indicate strong demand. Zimbabwe’s 2012/13 corn imports are raised 0.1 million to 0.4 million because of strong demand and imports for 2011/12. However, Malaysia’s 2012/13 corn imports are trimmed 0.1 million tons to 3.0 million as 2011/12 imports were smaller than previously forecast. Serbia’s 2012/13 imports are raised slightly due to tight supplies caused by drought.
 
Brazil’s corn exports are boosted 4.5 million tons to a record 19.0 million, and Brazil is expected to be the world’s second largest corn exporter in 2012/13. Brazil reportedly shipped a record pace of corn exports in September 2012 of over 3 million tons, boosting estimated 2011/12 exports 0.7 million this month to 12.7 million. Brazil has demonstrated that without soybeans and products taking priority for ports and other transportation infrastructure, it can ship very large volumes of corn if prices are attractive. From October 2012 to February 2013, Brazil is expected to ship large volumes of corn, with a secondary increase in August and September 2013 if soybean shipments tail off or transportation bottlenecks are reduced.
 
India’s 2012/13 corn exports are forecast up 0.5 million tons this month to 3.0 million. The pace of recent shipments indicates India will export corn if foreign prices are attractive (2011/12 corn exports are raised 0.6 million tons this month to 4.4 million).
 
Facing strong competition from Brazil and other exporters, U.S. corn export prospects for 2012/13 are weakening. At the end of September 2012, outstanding sales of corn were 8.3 million tons, down 6.0 million from the previous year, when corn exports were sluggish. U.S. 2012/13 corn exports are projected down 2.5 million tons this month to 31.0 million, the lowest in almost 40 years (the September-August local marketing year is cut 100 million bushels to 1.15 billion bushels).
 October 2012
 
Published by USDA Economic Research Service
Title: Re: Corn & Seed/Oil Commodities
Post by: Mustang Sally Farm on November 03, 2012, 06:03:09 AM

Weekly Roberts Market Report
02 November 2012



 Michael T. Roberts
 Extension Agriculture Economist,
Dairy and Commodity Marketing,
NC State University


US - CORN futures on the Chicago Board of Trade (CBOT) closed mixed on Monday. The DEC’12 contract closed at $7.360/bu; down 1.75 ¢ /bu and 25.25 ¢ /bu lower than last week at this time. MAR’13 corn futures closed at $7.380/bu; down 1.75 ¢ /bu and 21.25 ¢ /bu lower than last report, writes Michael T. Roberts.

The DEC’13 contract closed at $6.356/bu; up 0.5 ¢ /bu and 2.5 ¢ /bu higher than a week ago. Hurricane Sandy kept, no fresh news, and weak demand kept traders on the sidelines. Cash prices for all the grains ended lower keeping basis levels firm. The national average basis is -13 ¢ /bu under CBOT December futures. With the harvest nearly complete farmers have slowed selling in anticipating of higher prices on tighter U.S. supplies. Basis in North Carolina ranged from +25 ¢ /bu to +29 ¢ /bu of December futures with cash prices ranging from $7.62/bu to $7.66 ¢ /bu.Exports were supportive in the near-term but should be viewed as bearish. USDA put corninspected-for-export at 15.516 mb vs. estimates for 8-15 mb. Although 5.038 mb more than last week’s report from USDA, this was well below the 22.7 mb needed to stay on pace with USDA’s most recent demand projection of 1.15 bb. Year-to-date inspections total 143.3 mb; 19% behind the 176.9 mb needed to stay on pace year-to-date. Please see chart.
 



SOYBEAN futures on the Chicago Board of Trade (CBOT) closed down on Monday. NOV’12 futures closed at $15.272/bu; down 34.0 ¢ /bu and 19.25 ¢ /bu lower than last report. The MAR’13 contract closed at $15.056/bu; down 31.25 ¢ /bu and 12.0 ¢ /bu lower than a week ago. NOV’13 futures closed at $13.290/bu; off 10.75 ¢ /bu and 8.0 ¢ /bu lower than last Monday. The November 2012 contract expires Friday. Expect volatility this week providing opportunities for both profit … and … loss. Soybean futures returned to a downtrend wiping out last week’s gains amid light trading volume. Hurricane Sandy kept traders on the sidelines. Rains forecast for Brazil improving the outlook for South American soybean crops pressured prices. Soybeans traded under last week’s low of $15.265 leaving it susceptible to additional noncommercial long-liquidation. The measuring objective is near $14.857/bu with long-term support near $14.52/bu. On the other hand, soybean futures were supported by doubts that South American production will be strong this crop year, tight soybean stocks, and strong technical signals amid long liquidation. Exports are bullish with USDA putting soybeans-inspected-for-export at 63.358 mb vs. estimates for between 40-60 mb. This is well above the 22.7 mb needed to stay on track with the agency’s 1.265 bb demand projection. Please see chart:
 



Soybean basis levels rose on the Mississippi river amid lower barge freight rates. The latest national average soybean basis was placed at -45.0 ¢ /bu under the Chicago November futures contract. Basis in North Carolina was -$1.10/bu to -12.25 ¢ /bu under November 2012 futures with cash prices ranging from $14.09 -$15.17/bu.

 WHEAT futures in Chicago (CBOT) closed down on Monday. DEC’12 wheat futures finished at $8.580/bu; off 5.75 ¢ /bu and 20.25 ¢ /bu lower than a week ago. The JULY’13 contract closed at $8.622/bu; down 2.5 ¢ /bu but 5.75 ¢ /bu higher than last report. Spillover selling from a stronger U.S. dollar and weaker soybean futures pressured wheat prices. Persistently lower production forecasts from Australia and dry conditions in the U.S. Plains amid tightening global supplies were supportive. Exports were bearish with USDA putting wheat inspected for export at 9.7 mb vs. estimates for 10-17 mb. This was below the 23.7 mb needed to stay on pace with USDA’s demand projections. Soft Red Winter Wheat’s national average basis was placed at -37 ¢ /bu under CBOT December futures. Hard Red Winter Wheat was placed at - 54 ¢ /bu under Kansas City December futures. Hard Red Spring Wheat national average basis was placed at -64 ¢ /bu under the Minneapolis December futures contract. New crop wheat in North Carolina ranged from $7.28-$8.02/bu.

DAIRY CLASS III futures on the Chicago Mercantile Exchange (CME) closed mixed on Monday with nearbys down and deferreds up. The OCT’12DA contract closed even with Friday’s close at $21.03/cwt. This was $0.$0.02/cwt lower than last report. DEC’12DA futures closed at $19.97/cwt; down $0.31/cwt and $0.52/cwt lower than a week ago. The MAR’13DA contract closed at $18.85/cwt; down $0.14/cwt and $0.35/cwt lower than last report. Hurricane Sandy may prove supportive. A significant amount of milk is produced and consumed in the affected areas. Almost 20% of U.S. milk production is located along the East Coast. More than 45% of this milk is consumed via fluid form. Fluid milk sales spiked ahead of the storm. That’s good for sales. However, if electricity is lost and product spoils, a major restocking will be needed. Additionally, areas of milk production hardest hit by damaging winds and floods may struggle to ship milk while power outages could force dairy processors from running plants. Result: a lot of dumped milk and stronger dairy product prices in the near-term. Lower cheese and butter prices are expected in the long-term. Milk components are improving nationally increasing output. Bottling demand is steady. Cream supply is plentiful with some other Class II products requiring more for holiday production. Class III futures were: 3 months out = $20.62/cwt ($0.09/cwt lower than last report); 6 months out = $19.83/cwt ($0.27/cwt lower than a week ago); 9 months out = $19.45/cwt ($0.22/cwt lower than last Monday); and 12 months out = $19.22/cwt ($0.16/cwt under last report). This week variable cost of production for the average. North Carolina conventional 200 cow dairy with a 23,000 lb average is $22.85/cwt; $0.30/cwt higher than last Monday.

 LIVE CATTLE futures on the Chicago Mercantile Exchange (CME) closed mixed on Monday. The OCT’12LC contract closed at $125.375/cwt; down $0.125/cwt and $1.025/cwt lower than last report. DEC’12LC futures closed at $125.275/cwt; up $0.025/cwt but $2.000/cwt lower than a week ago. APR’13LC futures closed at $133.425/cwt; up $0.025/cwt but $1.525/cwt under this time last week. Thin volume as traders waited on the effects of Hurricane Sandy and light demand were market “non” movers. Choppy trade was marked by managed fund selling. Cash cattle were called steady with little or no activity as both bid and ask prices were poorly defined. Pit sources said after the markets closed that beef shipments and near-term consumer demand are expected to slack off as a result of the severe weather. As the storm approached no one was interested in buying meat for freezers that could be without power. Later this week trade should pick up as