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August 31, 2016
Grain Market Outlook
he U.S. corn market in what remains of 2016 through mid‐
2017 include: 1) the pace and timing in regards to how U.S. farmers market their 2016 corn crop – much of
which will be placed in storage after fall harvest, 2) anticipation of continued strong use of 2015‐2016 crop U.S.
corn in domestic U.S. ethanol production and livestock …
September 18, 2014
Grain Market Outlook
… of 171.7 bushels per acre. Along with a
record 2014 U.S. corn crop, the USDA also projected record U.S. corn total supplies of 15.607 bb. Projected
“new crop” MY 2014/15 total corn usage of 13.605 bb is also a record, with ethanol use of 5.125 bb
(unchan … unchanged from MY 2013/14), non‐ethanol FSI use of 1.405 bb (up 30 mb), exports of 1.750 bb (down 175 mb
from last year), and feed and residual use of 5.325 bb (up 250 mb). “New crop” ending stocks were also raised
to 2.002 bb (up 194 mb from last month and up 821 mb from last year) with ending stocks‐to‐use of 14.72%
(up from 8.58% S/U a year ago). The USDA forecast that “new crop” MY 2014/15 U.S. average cash corn prices
will be in the range of $3.20‐$3.80 per bushel with a midpoint of $3.50 – down $0.40 /bu from August.
KSU U.S. Corn Forecast for “New Crop” MY 2014/15: KSU projections for “new crop” MY 2014/15 are as
follows: a) “Likely Production” Scenario: 60% prob. of 90.141 ma planted, 82.470 ma harvested, average
yields of 170.5 bu/ac, 14.061 bb 2014 U.S. corn production, 15.272 bb U.S. corn supplies, 13.449 bb total use,
1.823 bb ending stocks, 13.6% S/U, & $3.70 /bu U.S. corn price; b) “High Production” Scenario (equal to USDA
September forecast): 25% prob. of 91.641 ma planted, 83.839 ma harvested, yields of 171.7 bu/ac, 14.395 bb
2014 U.S. corn production, 15.607 bb U.S. corn supplies, 13.605 bb total use, 2.002 bb ending stocks, 14.7%
S/U, & $3.50 /bu, and c) “Low Production” Scenario: 15% prob. of 88.641 ma planted, 81.098 ma harvested,
lower yields of 168.0 bu/ac, 13.624 bb 2014 U.S. corn production, 14.845 bb U.S. corn supplies, 13.214 bb total
use, 1.631 bb ending stocks, 12.3% S/U, & $4.00 /bu U.S. average corn price.
World Corn Total Supplies of 1,161 mmt projected for “new crop” MY 2014/15 are up from 1,125 mmt in “old
crop” MY 2013/14, and up from 1,003 mmt in MY 2012/13. Projected World corn ending stocks of 190 mmt
(19.7% S/U) in “new crop” MY 2014/15 are up from 173 mmt (18.2% S/U) in “old crop” MY 2013/14, and from
138 mmt (16.0% S/U) in MY 2012/13. Combined “new crop” MY 2014/15 corn production for the U.S.’ major
export competitors Brazil (75.0 mmt – down 4.3) and Argentina (23.0 mmt – down 2.0) is projected to be down
6.3 mmt. Forecast Ukraine 2014 corn production of 26.0 mmt is down 4.9 mmt. South American acreage
decisions will be made for first planting of crops by Nov‐Dec 2014, with subsequent plantings coming after the
first of the year. With closing NOV‐2015 soybean futures of $9.99 and DEC‐2015 corn futures of $3.87 on
9/17/2014, the ratio of 2.58 favors soybeans. If South American farmers shift sizable acreage away from 2015
corn into 2015 soybeans, then by March‐April 2015 World corn market price prospects for MY 2015/16 could
be effected – impacting U.S. farmers’ 2015 planting choices in the spring. …
December 18, 2015
Grain Market Outlook
… … The CME DECEMBER 2016 corn contract represents price prospects during September‐November, 2016 –
including the anticipated bulk of the key U.S. corn harvest period of October through early November, 2016.
DECEMBER 2016 is the futures contract which local basis adjustments are made off of for most of the “harvest
2016” corn and grain sorghum forward contract price bids or hedges. The DECEMBER 2016 corn futures
market contract also initially responded “neutrally” to the information in the December 9th USDA reports, and
since has trended sideways in a generally volatile manner.
DEC 2016 CME Corn Futures
Sept. 2014 – Dec. 18, 2015
Close = $3.97 on 12/18/2015
MARCH 2016 CME Corn Futures
Sept. 2014 – Dec. 18, 2015
Close = $3.74 ½ on 12/18/2015
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On the day of the report CME DECEMBER 2016 corn futures prices opened at $3.95 ½ per bushel, trading
within the range of $3.93 ‐ $4.00 ½ during the session, before settling at $3.95 ½ – unchanged for the day
(Figure 1). Since then, DECEMBER 2016 Corn has traded from lows of $3.85 ¾ on December 17th to a high of
$4.01 ½ on December 18th before closing at $3.97 on that same day.
I‐C. Kansas Corn Seasonal Average Price Trends
Seasonal average price index trends for Kansas corn over the last 5, 10, and 15 years indicate definite
seasonal price trends (Figure 2).
Figure 2. Kansas Corn Seasonal Price Index – Last 15 Marketing Years (MY 1999/00 – “Old Crop” MY
2014/15) plus “New Crop” MY 2015/16 Estimate (Source: KSU www.AgManager.info)
Since MY 1999/00 Kansas corn prices have typically been weakest during the harvest month of October,
with an average seasonal price index of 93.4% of the unweighted average Kansas corn price for the September
through August marketing year period. However, Kansas cash corn prices have then trended higher from
harvest lows beginning in November. On average this uptrend in Kansas corn prices has continued from
November through the late spring – early summer months of May‐June the following year – up to highs of
103.9% of the marketing year average price in May, and the maximum of 104.5% in June. The most variability
around these monthly indices have occurred at the beginning quarter (September‐November) and ending
quarter (June‐August) of the September‐August U.S. corn marketing years.
For September through December 2016, U.S. corn prices have followed approximately the same
seasonable pattern, with declining prices in October 2015 and lower prices in November, but a moderate
seasonal increase in December.
I‐D. U.S. Trade Weighted Dollar Index
The Trade Weighted U.S. Dollar Index has been generally trending higher from mid‐July 2011 through
early July 2014 (Figure 3). After an index value of 75.73 on July 1, 2014, the calculated U.S. trade weighted
95.2%
93.4 …
October 27, 2015
Grain Market Outlook
rain usage.
A combination of these production and demand impacts over time are likely to eventually cause a change in
the prevailing “large crop – low price” market scenario in U.S. and World coarse grain markets.
USDA U.S. Corn Market Forecast: In the 10/9/2015 WASDE report, the USDA lowered is forecast of 2015 U.S.
corn production as well …
April 30, 2015
Grain Market Outlook
rojected average corn prices. Projected record U.S. corn total supplies of
15.472 bb (billion bushels) are up 5.4% from 14.686 bb last year. Projected MY 2014/15 total corn usage of
13.645 bb (down 50 mb or million bushels from a month ago) is also a record, with ethanol use of 5.200 bb,
non‐ …
November 18, 2014
Grain Market Outlook
… … and Demand Estimates (WASDE) report – containing U.S. and World corn supply‐demand
and price projections for both the “old crop” 2013/14 as well as for “new crop” 2014/15 marketing years. The
“old crop” 2013/14 marketing year ended on August 31, 2014, while the “new crop” 2014/15 U.S. corn
marketing year will last from September 1, 2014 through August 31, 2015.
I‐B. Corn Futures Trends Since the November 11th USDA Reports
The “new crop” DECEMBER 2014 corn futures market contract responded in a moderately positive
manner to the information in the November 10th USDA reports. On the day of the report – Monday,
November 10th – Chicago Mercantile Exchange (CME) DEC 2014 corn futures prices opened at $3.66 per
bushel, and traded in a range of $3.64 ¾ ‐ $3.78 ¾ during the session, before settling at $3.69 ¼ – up $0.01 ¾
for the day (Figure 1). The USDA report findings were publicly released at approximately mid‐session, i.e.,
12:00 noon eastern time (11:00 a.m. central) that day. Since then, DEC 2014 has traded from a low of $3.65 ½
on Tuesday, November 11th to a high of $3.89 on Thursday, November 13th before closing at $3.77 ½ on
Monday, November 17th.
Figure 1. DEC 2014 and JULY 2015 CME Corn Futures Price Charts (electronic trade) …
June 20, 2016
Grain Market Outlook
1) declining U.S.
farmer resistance to selling 2015 crop corn at lower than hoped for 2016 cash corn prices to‐date as both
winter wheat or fall crop harvests approach requiring both commercial and on‐farm storage space, 2)
continued stronger‐than‐anticipated use of 2015 crop U.S. corn in ethanol production, livestock feed …
February 11, 2016
Grain Market Outlook
… … Average 15th Percentile Low U.S. 2015/16
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Figure 3. Daily U.S. Trade Weighted Dollar Index – Major Currencies (DTWEXM) …
April 25, 2016
Grain Market Outlook
e and production prospects. Low corn
prices and limited corn net returns prospects may reduce U.S. 2016 corn acreage and production prospects.
Market factors such as a) economic and financial system disruptions impacting grain, energy, and other
commodity mar … and
balance sheet for “current crop” MY 2015/16 – with 2015 U.S. corn production of 13.601 bb, and total supplies
of 15.382 bb for MY 2015/16. Total use is projected to be 13.521 bb (down 24 million bushels or ‘mb’) Ethanol
use was projected to be …
March 17, 2015
Grain Market Outlook
n projected average corn prices. Projected record U.S. corn total supplies of
15.472 bb (billion bushels) are up 5.4% from 14.686 bb last year. Projected MY 2014/15 total corn usage of
13.695 bb (up 50 mb or million bushels from a month ago) is also a record, with ethanol use of 5.200 bb (down …