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June 18, 2014
Grain Market Outlook
ating usage, higher ending stocks, and lower prices versus a year earlier. The June 30th
USDA Acreage and Quarterly Stocks reports are likely to cause changes in U.S. corn supply‐demand estimates
in the upcoming July 11th WASDE report. Even then, the first survey‐based projection of 2014 …
August 31, 2016
Grain Market Outlook
n
exports – driven largely by a poor harvest and lack of exportable supplies in Brazil, and 4) the possibility of
broader U.S. and Foreign economic and financial system disruptions impacting grain, energy, and other
commodity markets – such as unanticipated U.S. financial policy announcements by the U.S. Federal Reserve
affecting U.S. interest rates, or geo‐political events that could “shock” World energy markets.
USDA Supply‐Demand Forecast for “New Crop” MY 2016/17: With USDA projections of 2016 U.S. corn
plantings of 94.148 ma (up 6.149 ma from 2015), harvested acres of 86.550 ma (up 5.801 ma from 2015),
record high projected yields of 175.1 bu/ac (vs 168.4 bu/ac in 2015 and the current record high of 171.0 bu/ac
in 2014), 2016 U.S. corn production is forecast to be a record high 15.153 bb – up from 13.601 bb in 2015, the
current record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “new crop” MY 2016/17 total supplies of 16.909 bb (record high), total use of 14.500 bb (record
high), and projected ending stocks of 2.409 bb (16.61% S/U) – up from 1.706 bb (12.46% S/U) in “old crop” MY
2015/16 and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the
USDA to be in the range of $2.85‐$3.45 (midpoint = $3.15 /bu) – being down from the $3.60 /bu midpoint
estimate for “current” MY 2015/16. This scenario is given a 20% likelihood of occurring by KSU.
KSU Forecasts for “New Crop” MY 2016/17: Three alternative KSU‐Scenarios for U.S. corn supply‐demand and
prices are presented for “new crop” MY 2016/17, with each assuming a lower U.S. corn yields and production
than the August 12th USDA WASDE report.
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KSU Scenario A) “Minor Crop Problems – 14.9 bb” Scenario (35% probability) assumes: 94.148 ma planted,
86.550 ma harvested, 172.0 bu/ac yield, 14.887 bb production, 16.743 bb total supplies, 14.450 bb total use,
2.293 bb ending stocks, 15.87% S/U, & $3.25 /bu U.S. corn average price for “new crop” MY 2016/17;
KSU Scenario B) “Moderate Crop Problems – 14.5 bb” Scenario (35% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 168.0 bu/ac yield, 14.540 bb production, 16.396 bb total supplies, 14.344 bb
total use, 2.052 bb ending stocks, 14.31% S/U, & $3.45 /bu U.S. corn average price for “new crop” MY
2016/17;
KSU Scenario C) “More Serious Crop Problems – 14.2 bb” Scenario (10% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 164.0 bu/ac yield, 14.194 bb production, 16.137 bb total supplies, 14.239 bb
total use, 1.898 bb ending stocks, 13.33% S/U, & $3.60 /bu U.S. corn average price for “new crop” MY
2016/17;
World Corn Supply‐Demand: World corn production of 1,028.4 million metric tons (mmt) is projected for “new
crop” MY 2016/17, up from 959.7 mmt in “old crop” MY 2015/16, and up from 1,013.6 mmt in MY 2014/15.
World corn total supplies of 1,237.7 mmt are projected for “new crop” MY 2016/17, up from 1,170.0 mmt in
“old crop” MY 2015/16, and up from 1,188.9 mmt in MY 2014/15. World corn exports of 137.25 mmt are
projected for “new crop” MY 2016/17, up from 119.7 mmt in “old crop” MY 2015/16, but down from 141.7
mmt in MY 2014/15. Projected World corn ending stocks of 220.8 mmt (21.7% S/U) in “new crop” MY 2016/17
are up from 209.3 mmt (21.9% S/U) in “old crop” MY 2015/16, and from 208.3 mmt (21.2% S/U) in MY
2014/15.
Brazilian corn production in MY 2015/16 (produced in early‐mid 2016) is estimated to be 68.5 mmt, down 16.5
mmt (down 19.5%) from MY 2014/15. This shortfall in Brazilian corn production in 2016 has provided some
support for U.S. corn exports and even ethanol production (via exports). But expectations of a record large
2016 U.S. corn crop have had a predominant negative impact on U.S. corn prices. Brazilian corn production is
forecast by the USDA to rebound back to 80 mmt in MY 2016/17 (2017 production).
…
September 22, 2016
Grain Market Outlook
ven largely by a poor harvest and lack of exportable supplies in Brazil in 2016, and 4) the
possibility of broader U.S. and Foreign economic and/or financial system disruptions impacting grain, energy,
and other commodity markets. For example, unanticipated U.S. financial policy announcements by the U.S.
Federal Reserve could affect U.S. interest rates, or geo‐political events could occur that would “shock” World
energy and grain markets.
USDA Supply‐Demand Forecast for “New Crop” MY 2016/17: With USDA projections of 2016 U.S. corn
plantings of 94.148 ma (up 6.149 ma from 2015), harvested acres of 86.550 ma (up 5.801 ma from 2015),
record high projected yields of 174.4 bu/ac (vs 168.4 bu/ac in 2015 and the current record high of 171.0 bu/ac
in 2014), 2016 U.S. corn production is forecast to be a record high 15.093 bb – up from 13.601 bb in 2015, the
current record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “new crop” MY 2016/17 total supplies of 16.859 bb (record high), total use of 14.475 bb (record
high), and projected ending stocks of 2.384 bb (16.47% S/U) – up from 1.716 bb (12.54% S/U) in “old crop” MY
2015/16 and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the
USDA to be in the range of $2.90‐$3.50 (midpoint = $3.20 /bu) – being down from $3.60 /bu for “old crop” MY
2015/16. This scenario is given a 50% likelihood of occurring by KSU Extension Ag Economist D. O’Brien.
KSU Forecasts for “New Crop” MY 2016/17: Three alternative KSU‐Scenarios for U.S. corn supply‐demand and
prices are presented for “new crop” MY 2016/17, with each assuming a lower U.S. corn yields and production
than the September 12th USDA WASDE report.
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KSU Scenario A) “Minor Crop Problems – 14.9 bb” Scenario (30% probability) assumes: 94.148 ma planted,
86.550 ma harvested, 172.0 bu/ac yield, 14.887 bb production, 16.653 bb total supplies, 14.450 bb total use,
2.203 bb ending stocks, 15.25% S/U, & $3.35 /bu U.S. corn average price for “new crop” MY 2016/17;
KSU Scenario B) “Moderate Crop Problems – 14.5 bb” Scenario (35% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 168.0 bu/ac yield, 14.540 bb production, 16.306 bb total supplies, 14.344 bb
total use, 1.962 bb ending stocks, 13.68% S/U, & $3.50 /bu U.S. corn avg. price for “new crop” MY 2016/17;
KSU Scenario C) “More Serious Crop Problems – 14.2 bb” Scenario (10% probability) assumes: 94.148 ma
planted, 86.550 ma harvested, 164.0 bu/ac yield, 14.194 bb production, 15.190 bb total supplies, 14.239 bb
total use, 1.721 bb ending stocks, 12.09% S/U, & $3.80 /bu U.S. corn avg. price for “new crop” MY 2016/17;
World Corn Supply‐Demand: World corn production of 1,026.6 million metric tons (mmt) is projected for “new
crop” MY 2016/17, up from 959.0 mmt in “old crop” MY 2015/16, and up from 1,013.6 mmt in MY 2014/15.
World corn total supplies of 1,235.9 mmt are projected for “new crop” MY 2016/17, up from 1,167.3 mmt in
“old crop” MY 2015/16, and up from 1,188.9 mmt in MY 2014/15. World corn exports of 139.8 mmt are
projected for “new crop” MY 2016/17, up from 119.2 mmt in “old crop” MY 2015/16, but down from 141.7
mmt in MY 2014/15. Projected World corn ending stocks of 219.5 mmt (21.6% S/U) in “new crop” MY 2016/17
are up from 209.25 mmt (21.8% S/U) in “old crop” MY 2015/16, and from 208.3 mmt (21.2% S/U) in MY
2014/15.
Brazil corn production in “old crop” MY 2015/16 (1st crop harvested in January‐May 2016, 2nd crop harvested
in May‐August) is estimated to be 67.0 mmt, down 18.0 mmt (down 21.2%) from 85.0 mmt in MY 2014/15.
This shortfall in Brazilian corn production in 2016 has provided some support for U.S. corn exports and even
ethanol production (via exports). But expectations of a record large 2016 U.S. corn crop have had a
predominant negative impact on U.S. corn market prices to date. Brazilian corn production is forecast by the
USDA to rebound back to 82.5 mmt in MY 2016/17 (2017 production).
China corn production in “new crop” MY 2016/17 (harvested in September‐October 2016) is estimated to be
216.0 mmt, down 8.6 mmt (down 3.8%) from 224.6 mmt in MY 2015/16, but marginally higher than 215.65
mmt in MY 2014/15. Most of the focus in World corn markets is on Chinese ending stocks. Ending stocks of
corn in China are projected to be 103.65 mmt (45.9% SU) in “new crop” MY 2016/17, down from 110.7 mmt
(50.9% S/U) in “old crop” MY 2015/16, but up from 110.5 mmt (49.7% S/U) in MY 2014/15.
…
December 28, 2016
Grain Market Outlook
r U.S.
and Foreign economic and/or financial system disruptions impacting grain, energy, and other commodity
markets in 2017.
For example, U.S. financial policy announcements by the U.S. Federal Reserve in 2017 could lead to increases
in U.S. interest rates and the value of the U.S. dollar relative to other World currencies, which could in turn
have a negative impact on U.S. corn exports. Also, World geo‐political events could provide an unanticipated
“shock” to U.S. and World energy and grain markets – with the impact on the direction of U.S. and World corn
markets being difficult to anticipate.
USDA Supply‐Demand Forecast for “Current” MY 2016/17: With USDA projections of 2016 U.S. corn plantings
of 94.490 ma, harvested acres of 86.836 ma, record high projected yields of 175.1 bu/ac (vs 168.4 bu/ac in
2015 and the previous record high of 171.0 bu/ac in 2014), 2016 U.S. corn production is forecast to be a record
high 15.226 bb – up from 13.601 bb in 2015, the previous record of 14.216 bb in 2014, and 13.829 bb in 2013.
With forecast “current” MY 2016/17 total supplies of 17.031 bb (record high), total use of 14.610 bb (record
high), and projected ending stocks of 2.403 bb (16.45% S/U) – up from 1.738 bb (12.72% S/U) in MY 2015/16
and the highest since 4.259 bb (54.90% S/U) in MY 2004/05 – U.S. corn prices are projected by the USDA to be
in the range of $3.05‐$3.65 (midpoint = $3.35 /bu) – being down from $3.61 /bu for MY 2015/16. (continued)
USDA Supply‐Demand Forecast for “Next Crop” MY 2017/18: With early USDA projections of 2017 U.S. corn
plantings of 90.000 ma (down 4.490 ma), harvested acres of 82.300 ma (down 4.536 ma), projected yields of
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170.8 bu/ac (vs the record high of 175.3 in 2016), 2017 U.S. corn production is forecast to be 14.060 bb – down
from the record high of 15.226 bb in 2016.
With forecast “next crop” MY 2017/18 total supplies of 16.513 bb (down 500 mb from last year’s record high),
total use of 14.215 bb (down 395 mb from last year’s record high), and projected ending stocks of 2.298 bb
(16.17% S/U) – down from 2.403 bb (16.45% S/U) in “current” MY 2016/17 – U.S. corn prices are projected by
the USDA to average $3.30 /bu. This scenario is given a 55% likelihood of occurring by KSU Extension Ag
Economist D. O’Brien.
Alternative KSU Forecasts for “Next Crop” MY 2017/18: Three alternative KSU‐Scenarios for U.S. corn supply‐
demand and prices are presented for “next crop” MY 2017/18. Each forecast scenario presents the likelihood
of lower U.S. corn yields and production than projected by the USDA in the December 1st USDA early supply‐
demand estimate for “next crop” MY 2017/18.
KSU “Next Crop” MY 2017/18 Scenario #1) “167.4 bu/ac – 13.777 bb” Scenario (25% probability) assumes:
90.000 ma planted, 82.300 ma harvested, 167.4 bu/ac trend yield, 13.777 bb production, 16.230 bb total
supplies, 14.215 bb total use, 2.015 bb ending stocks, 14.18% S/U, & $3.55 /bu U.S. corn average price for
“next crop” MY 2017/18;
KSU “Next Crop” MY 2017/18 Scenario 2) “165.0 bu/ac – 13.580 bb” Scenario (15% probability) assumes:
90.000 ma planted, 82.300 ma harvested, 165.0 bu/ac yield, 13.580 bb production, 16.033 bb total supplies,
14.215 bb total use, 1.818 bb ending stocks, 12.79% S/U, & $3.70 /bu U.S. corn average price for “next crop”
MY 2017/18;
KSU “Next Crop” MY 2017/18 Scenario #3) “150.0 bu/ac – 12.345 bb” Scenario (5% probability) assumes:
90.000 ma planted, 82.300 ma harvested, 150.0 bu/ac yield, 12.345 bb production, 14.798 bb total supplies,
13.460 bb total use, 1.338 bb ending stocks, 9.94% S/U, & $4.30 /bu U.S. corn average price for “next crop” MY
2017/18;
World Corn Supply‐Demand: Record high World corn production of 1,039.7 million metric tons (mmt) is
projected for “current” MY 2016/17, up 8.2% from 961.1 mmt in MY 2015/16, and up 2.5% from 1,014.0 mmt
in MY 2014/15. Record high World corn total supplies of 1,248.7 mmt are projected for “new crop” MY
2016/17, up from 1,169.3 mmt in MY 2015/16, and from 1,188.8 mmt in MY 2014/15.
World corn exports of 147.7 mmt are projected for “new crop” MY 2016/17, up 21.8% from 121.2 mmt in MY
2015/16, and up 3.9% from 142.2 mmt in MY 2014/15. Projected record high World corn ending stocks of
222.25 mmt (21.7% S/U) in “new crop” MY 2016/17 are up from 208.95 mmt (21.8% S/U) in MY 2015/16, and
from 208.3 mmt (21.2% S/U) in MY 2014/15.
Although World corn ending stocks are projected to be a record high in “new crop” MY 2016/17 at 222.25
mmt, World corn percent ending stocks‐to‐use in “new crop” MY 2016/17 are forecast to actually decline
marginally to 21.7% ‐ indicative that strong World demand for corn at low prices is expected to continue –
especially in Europe where grain production has been hampered by extreme weather conditions in the last
year.
…
September 19, 2017
Grain Market Outlook
…
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I. U.S. Corn Market Situation and Outlook
September 12th USDA Crop Production & WASDE Reports
On September 12th the USDA World Agricultural Outlook Board (WAOB) released its September 2017
World Agricultural Supply and Demand Estimates (WASDE) report – containing U.S. and World corn supply‐
demand and price projections for the 2015/16, “old crop” 2016/17, and “new crop” 2017/18 marketing years
(MY) for corn. The “new crop” MY 2017/18 for U.S. corn began on September 1, 2017 and will last through
August 31, 2018. Earlier, on June 30th, the USDA National Agricultural Statistics Service (NASS)
(https://www.nass.usda.gov/) had released it’s Acreage (http://usda.mannlib.cornell.edu/usda/old crop/Acre/Acre‐06‐30‐2017.pdf) and
Grain Stocks (http://usda.mannlib.cornell.edu/usda/old crop/GraiStoc/GraiStoc‐06‐30‐2017.pdf) reports. Planted and harvested
acreage estimates from the June 30th Acreage report were used by the USDA to develop both the August 10th
and September 12th projections of 2017 U.S. corn production in the Crop Production and WASDE reports.
The USDA used at combination of in field objective yield measurements and farmers surveys conducted
between August …
October 25, 2017
Grain Market Outlook
… … as of
October 1st. The objective yield surveys for corn were conducted in the major producing states for
approximately 75% of U.S. corn production. Counts were made within sample plots in person by USDA
enumerators, recording number of corn plants and ears, and ear weights in order to calculate the projected
2017 biological yields for each plot. Average percent harvest loss was then subtracted from these biological
yield estimates to obtain a net yield for each plot sampled.
The same corn plots which were sampled for the August and September USDA NASS Crop Production
reports were revisited for the October report. The upcoming November 9th USDA NASS Crop Production
report will also be based on a similar combination of farmers’ own crop observations and harvested yield
reports, and actual in‐the‐field yield measurements and conditions for fields remaining to be harvested. A final
USDA NASS Crop Production Summary report with an estimate of 2017 U.S. corn production will be reported
in January 2018.
I‐b. CME DECEMBER 2017 & JULY 2018 Corn Futures Trends
DECEMBER 2017 CME Corn Futures
Following a low of $3.58 ½ on August 31, 2016, DECEMBER 2017 Chicago Mercantile Exchange (CME) corn
futures prices trended upward over time to highs of $4.04 on February 28, 2017, $4.09 on June 8th, and $4.17
¼ on July 11th (Figure 1). Following that high, DEC 2017 corn futures prices have declined to lows of $3.44 ¼ on
August 31st, $3.42 ½ on October 12th, and $3.43 on October 23rd ‐ before closing at $3.52 ¾ on October 24th.
JULY 2018 CME Corn Futures
In a similar trading pattern to DEC 2017 corn futures, following a low of $3.79 on August 31, 2016, JULY
2018 CME corn futures prices trended upward over time to highs of $4.18 ¾ on February 28, 2017, $4.26 ½ on
June 8th, and $4.34 ¼ on July 11th (Figure 1). Following that high, JULY 2018 corn futures prices declined to
lows of $3.71 on August 31, 2017, $3.72 ½ on September 12th, $3.73 on October 12th, and $3.73 ¼ on October
23rd ‐ before closing at $3.82 ½ on October 24th.
CME Corn Futures DEC 2017 – JULY 2018 Contract Spreads
The total futures carrying charge or “term spread” between DEC 2017 and JULY 2018 corn futures on
Wednesday, October 25th in mid‐morning trading was $0.29 ½ per bushel (i.e., $3.83 ¼ for JULY 2018 Corn less
Page | 5
$3.53 ¾ for DEC 2017 Corn), or $0.0421 per bushel per month over a 7‐month period. This compares to
commercial grain storage charges in Kansas grain elevators in the range of $0.04 to $0.05 per bushel per
month – before accounting for interest, additional handling costs, or other discounts.
Figure 1. DEC 2017 & JULY 2018 CME Daily Corn Futures Price Charts (as of October 24, 2017)
ne …
November 21, 2017
Grain Market Outlook
corn prices
and also to a moderately weaker U.S. dollar against other World currencies compared to a year ago. Exports of
U.S. corn are expected to continue at a “decent” pace of 1.925 bb for “new crop” MY 2017/18 even though
South American corn production will continue to be a competitive factor in World trade through at least the
end of 2017. Also, preliminary forecasts for 2018 are that Brazilian corn acreage and production will be lower
due to low prices and poor profitability in 2017, as well as a delayed 2nd crop of corn in parts of the country.
Combined with the potential for crop‐weather concerns in Brazil in coming months – these factors “could”
have a positive impact on U.S. corn exports and price prospects in spring‐summer 2018.
Fourth, a continuing threat exists of U.S. and Foreign economic and/or financial system disruptions that
could impact grain, energy, and other commodity markets in 2017‐2018. World geo‐political events could
provide “shocks” to U.S. and World energy and grain markets which could in turn impact grain prices in either
direction depending on the circumstances, the countries involved, and their role in global corn export trade.
4. USDA Supply‐Demand & Price Forecast for “New Crop” MY 2017/18
In the November 12th Crop Production report, the USDA raised its projections of a) projected yields up to a
record high of 175.4 bu/ac (vs the previous record of 174.6 in 2016), and b) 2017 U.S. corn production up to
14.578 bb – down from the record high of 15.148 bb in 2016.
The USDA raised its forecast “new crop” MY 2017/18 total supplies to 16.922 bb – down marginally (20
mb) from last year’s record high. Total use is forecast at 14.435 bb – down 212 mb from last year’s record
high. Ending stocks are projected to be a 2.487 bb (17.2% S/U) – up from 2.295 bb (15.7% S/U) in “old crop”
MY 2016/17. United States’ corn prices are projected to average $3.20 /bu (range of $2.80‐$3.60). This is
down $0.16 /bu from $3.36 /bu from “old crop” MY 2016/17. This scenario is given an 80% likelihood of
occurring by KSU Extension Agricultural Economist D. O’Brien.
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5. Alternative KSU Supply‐Demand & Price Forecast for “New Crop” MY 2017/18
Three alternative KSU‐Scenarios for U.S. corn supply‐demand and prices are presented for “new crop” MY
2017/18. These forecast scenarios vary from the USDA’s projection in the November 9, 2017 WASDE report
for “new crop” MY 2017/18.
A ‐ KSU “Higher Exports” MY 2017/18 Scenario) “2.250 bb Exports” Scenario (10% probability) assumes:
90.404 ma planted, 82.941 ma harvested, 175.4 bu/ac trend yield, 14.548 bb production, 16.893 bb total
supplies, 2.250 bb exports, 14.735 bb total use, 2.158 bb ending stocks, 14.65% S/U, & $3.50 /bu U.S. corn
average price;
B ‐ KSU “Lower Exports” MY 2017/18 Scenario) “1.800 bb Exports” Scenario (5% probability) assumes: 90.404
ma planted, 82.941 ma harvested, 175.4 bu/ac trend yield, 14.548 bb production, 16.893 bb total supplies,
1.800 bb exports, 14.310 bb total use, 2.583 bb ending stocks, 18.05% S/U, & $3.15 /bu U.S. corn average
price;
C ‐ KSU “Lower Yield” MY 2017/18 Scenario) “172.5 bu/ac – 14.307 bb crop” Scenario (5% probability)
assumes: 90.404 ma planted, 82.941 ma harvested, 172.5 bu/ac trend yield, 14.307 bb production, 16.652
bb total supplies, 14.435 bb total use, 2.217 bb ending stocks, 15.36% S/U, & $3.40 /bu U.S. corn average;
Note: The presence of large beginning stocks of 2.295 bb in “new crop” MY 2017/18 limit the “tightness” of
corn supply‐demand balances in scenarios “A” and “C”, and hinder potential upward price responses.
5. World Corn Supply‐Demand – With & Without China
World corn production of 1,043.9 million metric tons (mmt) is projected for “new crop” MY 2017/18, down
3.9% from the record of 1,074.8 mmt in “old crop” MY 2016/17, but still up 7.3% from 972.9 mmt in MY
2015/16. World corn total supplies of 1,270.5 mmt are down 1.45% from the record high 1,289.2 mmt in “old
crop” MY 2016/17, and still up 7.4% from 1,182.4 mmt in MY 2015/16.
World corn exports of a 151.6 mmt are projected for “new crop” MY 2017/18, down 7.3% from the record
high of 163.6 mmt in “old crop” MY 2016/17, and up 26.7% from 119.7 mmt in MY 2015/16. Projected World
corn ending stocks of 203.9 mmt (19.1% S/U) in “new crop” MY 2017/18 are down from the record high 226.6
mmt (21.3% S/U) in “old crop” MY 2016/17, and from 214.4 mmt (22.2% S/U) in MY 2015/16.
An alternative view of the World corn supply‐demand is presented if Chinese corn usage and ending stocks
are isolated from the World market. “World‐Less‐China” corn ending stocks are projected to be 125.2 mmt
(15.1% S/U) in “new crop” MY 2017/18, down from 125.9 mmt (15.2% S/U) in “old crop” MY 2016/17, but up
from 103.7 mmt (13.8% S/U) in MY 2015/16. These figures show that World stocks‐to‐use of corn less China’s
direct influence are projected to be approximately 21% lower (i.e., 15.1% S/U for the “World‐Less‐China”
versus 19.1% S/U for the “World” overall in “new crop” MY 2017/18).
At the same time, these figures also show that Chinese ending stocks of corn as proportion of the World
total are declining – down from 51.7% in MY 2015/16, to 44.5% in “old crop” MY 2016/17, and down to 38.6%
in “new crop” MY 2017/18. The deliberate actions in recent years ‐ taken by the Chinese government to
reduce feedgrain stockpiles – is impacting the relative amount of World total corn stocks they hold. These
actions may also eventually increase Chinese import demand for both U.S. corn and grain sorghum.
…
March 15, 2018
Grain Market Outlook
tighter foreign stocks and percent (%) stocks‐to‐use for corn, and c) the eventual “using up” of competing
South American corn exports in spring 2018.
Current forecasts are for 2018 Brazilian corn production to be 94.5 million metric tons (mmt) in this
marketing year – versus 98.5 mmt last year ‐ with harvests lasting from February through May. However,
forecasts are for 2018 Argentina corn production to be 36.0 mmt in this marketing year – versus 41.0 mmt a
year ago ‐ with harvests lasting from March through May. The Argentina production figure is at risk to falling
further. To the degree that 2018 corn production in Argentina and southern Brazil is limited by crop weather
issues, there will likely be subsequent support U.S. corn export prospects.
Fourth, a continuing threat exists of U.S. and Foreign economic and/or financial system disruptions that
could impact grain, energy, and other commodity markets in 2018. World geo‐political events could provide
“shocks” to U.S. and World energy and grain markets which could in turn impact grain prices in either direction
depending on the circumstances, the countries involved, and their role in global corn export trade.
4. USDA Supply‐Demand & Price Forecasts
In the March 8th WASDE report, the USDA left unchanged its projections of a) 2017 U.S. corn production of
14.604 bb – down from the record high of 15.148 bb in 2016, and b) “old crop” MY 2017/18 total supplies of
16.947 bb – up marginally from a year earlier. Total use is forecast at 14.820 bb – raised 225 mb from the
February WASDE on prospects for a) higher ethanol use of 5.575 bb (raised 50 mb), and b) higher exports of
2.225 bb (raised 175 mb). Ending stocks are projected to be a 2.127 bb (14.35% Stocks/Use) – down 225 mb
from February, and down from 2.293 bb (15.65% S/U) in MY 2016/17. United States’ corn prices are projected
to average $3.35 /bu (range of $3.15‐$3.55). This is down $0.01 /bu from $3.36 /bu from MY 2016/17.
At the Agricultural Outlook Forum in Arlington, Virginia on February 23, 2018, the USDA forecast that a)
2018 U.S. corn production would be 14.390 bb – based on 90.0 million acres (ma) planted, 82.7 ma harvested,
and a yield of 174.0 bu. Total use is forecast at 14.520 bb – with projections of ethanol use at 5.650 bb (a
record high), non‐ethanol food seed and industrial use at 1.495 bb (also a record high), exports of 1.900 bb
(down 325 mb from the current marketing year), and feed and residual use of 5.475 mb (down 75 mb from this
year). After a KSU‐adjustment for lower beginning stocks based on the March 8th WASDE report, ending stocks
are projected to be a 2.047 bb (14.10% Stocks/Use) – with both being down moderately from “old crop” MY
2017/18 levels. United States’ corn prices are projected to average a KSU‐adjusted $3.45 /bu (up $0.05‐$0.10
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from this year). It is probable that the export projection for “new crop” MY 2018/19 may be raised in coming
months due to South American production problems – causing these ending stocks and % stocks‐to‐use
estimates to tighten further. This scenario is given a 50% likelihood of occurring by KSU Extension
Agricultural Economist D. O’Brien.
5. Alternative KSU Supply‐Demand & Price Forecast for “New Crop” MY 2018/19
Two alternative KSU‐Scenarios for U.S. corn supply‐demand and prices are presented for “new crop” MY
2018/19. These projections are to show how varying 2018 U.S. corn production outcomes could affect U.S.
corn supply‐demand and price outcomes in “new crop” MY 2018/19.
A ‐ KSU “Higher 2018 U.S. Corn Production” Scenario for “new crop” MY 2018/19: (25% probability):
Assumptions are as follows: 90.000 ma planted, 82.700 ma harvested, 176.6 bu/ac record yield (equal to
2017 record high), 14.605 bb production, 16.782 bb total supplies, 14.600 bb total use, 2.182 bb ending
stocks, 14.95% S/U, & $3.30 /bu U.S. corn average price;
B ‐ KSU “Lower 2018 U.S. Corn Production” Scenario for “new crop” MY 2018/19: (25% probability):
Assumptions are as follows: 90.000 ma planted, 82.700 ma harvested, 164.4 bu/ac yield (equal to 2009
yield), 13.596 bb production, 15.773 bb total supplies, 14.315 bb total use, 1.458 bb ending stocks, 10.19%
S/U, & $4.20 /bu U.S. corn average price;
6. World Corn Supply‐Demand – With & Without China
World corn production of 1,041.7 million metric tons (mmt) is projected for “old crop” MY 2017/18, down
3.1% from the record of 1,075.2 mmt in MY 2016/17, but still up 7.0% from 973.45 mmt in MY 2015/16. World
corn total supplies of 1,273.6 mmt in “old crop” MY 2017/18 are forecast to be down moderately from the
record high 1,290.2 mmt in MY 2016/17, but up from 1,183.2 mmt in MY 2015/16.
World corn exports of a 155.9 mmt are projected for “old crop” MY 2017/18, down 2.4% from the record
high of 159.8 mmt in MY 2016/17, and up 30.2% from 119.7 mmt in MY 2015/16. Projected World corn ending
stocks of 199.2 mmt (18.5% S/U) in “old crop” MY 2017/18 are down from the record high 231.9 mmt (21.9%
S/U) in MY 2016/17, and from 215.0 mmt (22.2% S/U) in MY 2015/16. Projected Foreign (Non‐U.S.) corn
ending stocks of 145.1 mmt (17.0% S/U) in “old crop” MY 2017/18 are down from 173.6 mmt (21.9% S/U) in
MY 2016/17, and from 170.9 mmt (23.1% S/U) in MY 2015/16.
An alternative view of the World corn supply‐demand is presented if Chinese corn usage and ending stocks
are isolated from the World market. “World‐Less‐China” corn ending stocks are projected to be 119.6 mmt
(14.35% S/U) in “old crop” MY 2017/18, down from 131.1 mmt (15.9% S/U) in MY 2016/17, but up from 104.2
mmt (13.9% S/U) in MY 2015/16. These figures show that World stocks‐to‐use of corn less China’s direct
influence are projected to be approximately 22% lower (i.e., 14.35% S/U for the “World‐Less‐China” versus
18.5% S/U for the “World” overall in “old crop” MY 2017/18).
At the same time, these figures also show that Chinese ending stocks of corn as proportion of the World
total are declining – down from 51.5% in MY 2015/16, to 43.4% in MY 2016/17, and down to 39.9% in “old
crop” MY 2017/18. The deliberate actions in recent years ‐ taken by the Chinese government to reduce
feedgrain stockpiles – is impacting the relative amount of World total corn stocks they hold. These actions
may eventual increase Chinese import demand for U.S. corn and grain sorghum.
…
June 23, 2021
Use in Government Testimony
www.ageconomics.ksu.edu 3 | P a g e
plant event of 2019 and developments … https://www.agmanager.info/livestock-meat/meat-demand/monthly-meat-demand-monitor-survey-data ).
9 Additional details …
September 25, 2014
Commodity Program Papers
a higher
payment in the event of a qualifying payment under … Cargill,
ADM, etc.) and a survey sample of the smaller elevators … http://www.agmanager.info/events/Webinars/default.asp …