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August 1, 2018
Breakout Sessions
operatives: Who is Growing Broke?
Risk and Profit Conference Manhattan, KSAugust 17, 2018
Brian C. BriggemanProfessor and Director Arthur Capper Cooperative Center
Nathan SmartMS Graduate
Tough Times are here!
Total number of Kansas farmer co‐ops has fallen and the pace of decline might accelerate.
Total Number of Kansas Farmer Co‐ops
Source: USDA NASS and ACCC
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1950 …
May 5, 2020
2018 Farm Bill
choice between Agricultural Risk Coverage (ARC) and Price … https://www.agmanager.info/crop-insurance/risk-management-
strategies/mya-price-estimates-updated-arc-and-plc-commodity-0 …
October 17, 2022
2018 Farm Bill
2022
Agricultural Risk Coverage County payments … Ag. Statistics Service and RiskManagement Agency start publishing their …
January 13, 2023
2018 Farm Bill
decision between Agricultural Risk
Coverage (ARC) or Price … https://www.agmanager.info/crop-insurance/risk-management-strategies/projections-and-sources-mya-prices-
arc-and-plc-commodity …
August 1, 2025
Breakout Sessions
r Vulgamore, Jennifer Ifft, and Jesse Tack
Risk and Profit ConferenceAugust 21 & 22, 2025
Daily Soil MoistureJanuary 1st … to March 15th, 2022
Data source: NASA‐USDA Enhanced SMAP
Are decisions made based on early season soil moisture information supported by measurable impacts on corn yields?
Data Sources
Yield Data: USDA Risk Management Agency (1990‐2022) Precise county yield recordsAbility to control for irrigation status
Soil Moisture Data: NASA SPoRT‐LIS (1km2 …
November 15, 2018
Grain Market Outlook
in “new crop” MY
2018/19 are up 88.3% from 162.0 mb at this time a year earlier (Tables 2‐3). Among the countries that have
tangibly increased U.S. soybean imports from a year ago are some in the European Union (i.e., Italy, the
Netherlands, Portugal, Spain, Romania, and the United Kingdom), Japan, Taiwan, Iran, Malaysia, South Korea,
Thailand, Saudi Arabia, Egypt, Argentina, Canada, Columbia, Mexico, and Peru.
“Unknown #2” – The Size of South American Soybean Production in Early‐Mid 2019: With an opportunity
to sell soybeans to China given their distinct preference for soybeans from non‐U.S. sources, key South
American soybean producing countries such as Argentina and Brazil have reported plans to increase soybean
plantings for their 2019 crops. In Brazil, initial estimates in October from private sources and the USDA are for
a 1.0% increase in production to 120.4‐120.5 million metric tons (mmt), up from the USDA estimate 119.8 mmt
in 2018 (Figure 15). Recent estimates in November have not varied from the October projections. Weather
risks / threats to South American 2019 production will have to be dealt with over the coming months.
However, current intentions are for South American soybean production to increase in 2019 – which would
further negative prospects for U.S. soybean prices in “new crop” MY 2018/19 (Figures 17a‐b).
Planting of the South American soybean crop started in late fall 2018. This means that U.S. corn and
soybean producers will have some amount of information on 2019 South American crop and market prospects
when they make crop planting decisions in late winter – early spring 2019 here in the United States. All else
being equal, anticipated increases in 2019 South American soybean acreage and production prospects MAY
lead U.S. farmers to take a more pessimistic view of U.S. soybean market price prospects for Fall 2019, and
leader them to lower their 2019 U.S. soybean plantings and to raise their 2019 U.S. corn plantings.
2. Other Factors to Consider in Soybean Market Outlook
Prior to the escalation of the U.S.‐China trade dispute, U.S. soybean market prospects where described as
“neutral‐to‐cautiously optimistic” for the “new crop” 2018/19 marketing year. Now with the uncertainty and
potential negative impacts of 25% soybean import tariffs by China against U.S. soybeans, and a record large
2018 U.S. soybean crop being harvested, the “narrative consensus opinion” of the market has turned
pessimistic price‐wise, which has been reflected in “new crop” NOVEMBER 2018 Soybean futures (Figures 3a‐
b‐c).
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Chicago Mercantile Exchange (CME) JANUARY 2019 Soybean futures declined from a high of $10.60 on
May 29th, down to a low of $8.26 ¼ per bushel on September 18th (Figure 1). Since then, JAN 2018 Soybean
futures had increased to a high of $9.06 ¼ on October 15th before declining again to a low of $8.44 ½ on
October 31st, before increasing to a close of $8.88 ¾ on Wednesday, November 14th. In similar manner, CME
NOVEMBER 2019 Soybean futures closed at $9.36 ¾ per bushel on November 14th.
3. Kansas Cash Soybean Prices & Basis Bids
Cash soybean price bids on Thursday, November 15th in Central Kansas at major terminal elevator
locations were in the range of $7.54 ¾ to $7.93 ¾ per bushel ($1.35 to $0.95 under JAN 2019 CME soybean
futures). At Topeka and Atchison in Northeast Kansas, cash prices were both at $8.33 ¾ per bushel ($0.55
under JAN 2019). These Central and Northeast Kansas prices on November 15th are down substantially from
$9.88 ‐ $9.93 ($0.35 to $0.30 under JULY 2018 soybean futures) on May 30th. Cash soybean bids at Kansas
soybean processing plants in Emporia and Wichita on November 15th ranged from $8.26 ¾ to $8.30 ¾ per
bushel ($0.58 to $0.62 under JAN 2019) – also down substantially from May 30th when prices ranged from
$9.86 ($0.37 under JULY 2018) to $9.93 ($0.30 under) (Figure 2).
In Western Kansas cash soybean bids at major grain elevators on November 15th ranged from $7.42 to
$7.49 per bushel ($1.47 to $1.40 under JAN 2019), down substantially again from $8.88 ($1.35 under JULY
2018 futures) to $9.23 ($1.00 under) per bushel on May 30th.
4. Reviewing South American Export Competition in “Old Crop” MY 2017/18
Soybean market signals from South American export competitors Argentina, Brazil and Paraguay have
continued in their “improved” situation in recent months as a result of the U.S.‐China trade dispute (Figures
15‐16). Serious drought had caused Argentina soybean production to decline by 31.3% from a USDA estimate
of 55.0 million metric tons (mmt) in 2017 down to 37.8 mmt in 2018, and cut projected Argentine soybean
exports by 70.1% to 2.11 mmt in the “old crop” 2017/18 marketing year (MY) which ended on August 31st.
Argentina soybean meal exports were also 19.1% lower (25.35 mmt) in “old crop” MY 2017/18, down from
31.32 mmt in MY 2016/17.
However, Brazilian soybean production was higher – offsetting Argentina’s declines to a degree. Brazil is
estimated by the USDA to have produced a record high 119.80 mmt of soybeans in year 2018, up 4.5% from
the previous record of 114.60 mmt in year 2017. Brazilian soybean exports are estimated to have been 76.19
mmt in “old crop” MY 2017/18 (ending August 31st), up 20.7% from 63.14 mmt in MY 2016/17. Brazil soybean
meal exports are projected to be 16.8% higher (16.07 mmt) in MY 2017/18, up from 13.76 mmt in MY
2016/17.
Paraguay soybean production is estimated to be down marginally – providing a neutral influence to the
market. Paraguay is projected by the USDA to have produced 9.81 mmt of soybeans in year 2018 – down
moderately from 10.34 mmt in year 2017. Paraguay soybean exports are estimated to have been 6.25 mmt in
“old crop” MY 2017/18 (ending August 31st), up 2.0% from 6.13 mmt in MY 2016/17.
These three South American countries are the main competition in global soybean export markets for the
United States. Argentina, Brazil and Paraguay are forecast to comprise 55.2% (84.55 mmt) of estimated
World soybean exports (153.19 mmt) in “old crop” MY 2017/18. The U.S. is estimated to have made up 37.8%
Page | 4
(57.95 mmt) of World soybean exports for “old crop” MY 2017/18, with other countries making up the
remaining 7.0% (10.69 mmt) (Table 3).
The trade dispute between the U.S. and China has “pushed” Chinese soybean export purchases toward
Brazil and Argentina and away from the U.S. at least temporarily until the matter is either settled OR
exportable South American supplies are eventually no longer available in fall 2018. There has been both
negative and positive news coming from these negotiations to date, with any final agreement still to come.
5. U.S. Soybean Supply‐Demand Projections for “New Crop” MY 2018/19
The USDA provided a forecast of U.S. soybean supply, demand, and prices for “new crop” MY 2018/19 In
the November 8th USDA WASDE report. Based on 2018 U.S. soybean production projections 89.145 million
acres (ma) planted, 88.343 ma harvested, and 2018 U.S. soybean average yields of 52.1 bu/ac. (down 1.0 bu/ac
from October), the USDA forecast 2018 U.S. soybean production to be 4.600 bb (down 90 mb from October).
This 2018 forecast of a record high 4.600 bb in U.S. soybean production would be up from the previous record
of 4.411 bb in 2017, and the 2nd highest amount of 4.296 bb in 2016 (Table 1, Figures 5‐6‐7).
Total Supplies of U.S. soybeans in “new crop” MY 2018/19 are forecast to be a record high 5.063 bb, based
on 438 mb in beginning stocks, 4.600 bb in production, and 25 mb in imports. This amount is up from the
previous record highs of 4.734 bb and 4.515 bb in U.S. soybean Total Supplies in “old crop” MY 2017/18 and
MY 2016/17, respectively (Table 1, Figure 7).
Soybean crush in “new crop” MY 2018/19 is forecast to be a new record high of 2.080 bb – to be driven by
expected ongoing domestic usage for livestock feed and ongoing strength in U.S. soybean meal exports (Table
1, Figures 8 & 10a‐b). This would be up 25 mb in U.S. soybean crush from the previous record of 2.055 bb in
“old crop” MY 2017/18.
Exports of U.S. soybeans in “new crop” MY 2018/19 are forecast to be 1.900 bb – down 160 mb from
October, and down previous record highs of 2.129 bb in “old crop” MY 2017/18 and 2.166 bb in MY 2016/17
(Figures 9, 10a‐b, & 11). See the previous discussion on U.S. soybean export prospects in section #1 above.
Seed usage of U.S. soybeans is projected to be 96 million bushels (mb) in “new crop” MY 2018/19 – down
7 mb from October. Residual use is forecast at 32 mb. Seed use of 96 mb is forecast to be down 7.7% from
104 mb in “old crop” MY 2017/18 and 8.6% from 105 mb in MY 2016/17 (Table 1, Figures 10a‐b).
Total Use is projected to be a near‐record high of 4.107 bb – down 161 mb from October, and down 189
mb from the previous record high of 4.296 bb last year (Table 1, Figures 10a‐b).
As a result of these supply and use projections for “new crop” MY 2018/19, ending stocks are projected to
be a record high 955 mb – up 70 mb from October, and percent ending stocks‐to‐use is projected to be
23.25%. Both of these measures of U.S. soybean supply‐demand balances are projected to be double from the
previous marketing year, i.e., being up from 438 mb (10.20% S/U) in “old crop” MY 2017/18 (Table 1, Figures
10a‐b, 12a‐b, & 13).
United States’ soybean prices for “new crop” MY 2018/19 are projected in the range of $7.60‐$9.60
(midpoint = $8.60 /bu) – with the midpoint projection being down $0.73 /bu from $9.33 /bu in “old crop” MY
2017/18 (Table 1, Figures 12a‐b, & 13). This scenario is given a 60% likelihood of occurring by KSU Extension
Agricultural Economist D. O’Brien.
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6. Alternative KSU Soybean Forecast Scenarios for “New Crop” MY 2018/19
Three alternative KSU‐Scenarios to the USDA’s forecast for U.S. soybean supply‐demand and prices are
presented for “new crop” MY 2018/19 (Table 1a, Figure 12b). These projections show how varying 2018 U.S.
soybean export‐use and production scenarios could affect U.S. soybean supply‐demand and price outcomes in
“new crop” MY 2018/19. Probability‐weights are added to reflect judgements about how likely each scenario
is to occur in “new crop” MY 2018/19, i.e., during the September 1, 2018 through August 31, 2019 time period.
#1 ‐ KSU “LOWER U.S. Soybean EXPORTS” Scenario for “new crop” MY 2018/19: (20% probability):
Assumptions: 89.145 ma planted, 88.343 ma harvested, 52.1 bu/ac yield, 4.600 bb production, 5.063 bb
total supplies, 2.080 bb domestic crush, 1.750 bb exports (down 150 mb from USDA’s forecast), 3.957 bb total use
(down 150 mb vs USDA), 1.106 bb ending stocks (up 151 mb vs USDA), 27.95% Stocks/Use (up vs 23.25% for USDA), &
$8.40 /bu U.S. soybean average price (down vs $8.60 /bu for USDA);
#2 ‐ KSU “HIGHER 2018 U.S. Soybean EXPORTS” Scenario for “new crop” MY 2018/19: (15% probability):
Assumptions: 89.145 ma planted, 88.343 ma harvested, 52.1 bu/ac yield, 4.600 bb production, 5.063 bb
total supplies, 2.080 bb domestic crush, 2.200 bb exports (up 300 mb vs USDA), 4.410 bb total use (up 300 mb vs
USDA), 653 mb ending stocks (down 302 mb vs USDA), 14.81% Stocks/Use (down vs 23.25% for USDA), & $9.00 /bu
U.S. soybean average price (up vs $8.60 /bu for USDA);
#3 ‐ KSU “LOWER 2018 U.S. Soybean PRODUCTION” Scenario for “new crop” MY 2018/19: (5% probability):
Assumptions: 89.145 ma planted, 88.343 ma harvested, 50.0 bu/ac yield (down 2.1 bu/ac vs USDA), 4.417 bb
production (down 273 mb vs USDA), 4.880 bb total supplies (down 273 mb vs USDA), 2.080 bb domestic crush,
1.900 bb exports, 4.107 bb total use, 773 mb ending stocks (down 182 mb vs USDA), 18.82% Stocks/Use (down vs
23.25% for USDA), & $9.05 /bu U.S. soybean average price (up vs $8.60 /bu for USDA);
7. World Soybean Supply‐Demand Prospects
World soybean production of a record high 367.50 million metric tons (mmt) is projected for “new crop”
MY 2018/19, up 8.5% from 338.57 mmt in “old crop” MY 2017/18, and up 5.3% from the current record high of
348.95 mmt in MY 2016/17 (Figure 13). The “new crop” 2018/19 marketing year begins September 1, 2018
and continues through August 31, 2019. World soybean total supplies of 467.19 mmt in “new crop” MY
2018/19 are forecast to be up 7.2% from 435.96 mmt in “old crop” MY 2017/18, and up 8.7% from 429.81
mmt in MY 2016/17.
World soybean exports of a 155.44 mmt are projected for “new crop” MY 2018/19, up 1.5% from 153.19
mmt in “old crop” MY 2017/18, and up 5.5% from 147.39 mmt in MY 2016/17 (Figure 13). China is expected to
continue to be the key World soybean importer in the coming marketing year, although there are signs that
the Chinese are seeking to moderate their annual soybean usage or import increases through changes in
livestock feeding approaches. Also, disease pressures in the Chinese swine heard are likely to moderate their
overall soybean import demand.
Projected World soybean ending stocks of a record high 112.08 mmt (31.85% Stocks/Use) in “new crop”
MY 2018/19 are up from the previous record high of 99.69 mmt (29.60% S/U) in “old crop” MY 2017/18, up
from 97.39 mmt (29.57% S/U) in MY 2016/17, and 80.42 mmt (25.69% S/U) in MY 2015/16 (Figures 14 & 16a).
On a “World‐Less‐China” basis (i.e., excluding China from World demand and ending stocks numbers),
projected “World‐Less‐China” soybean ending stocks are a record high 92.24 mmt (38.1% Stocks/Use) in “new
Page | 6
crop” MY 2018/19. This amount of “World‐Less‐China” ending stocks are up substantially from 76.15 mmt
(33.0% S/U) (3rd highest on record) in “old crop” MY 2017/18, 76.73 mmt (34.0% S/U) (2nd highest on record) in
MY 2016/17, and 63.72 mmt (4th highest on record) (29.1% S/U) in MY 2015/16 (Figure 16b). Together,
Figures 14 and 16a‐b illustrate the distorting impact the massive buildup in World soybean ending stocks that
has occurred outside of China – which is a key factor in lower World soybean market prices.
Projected Foreign (Non‐U.S.) soybean ending stocks of 86.09 mmt (21.8% S/U) in “new crop” MY 2018/19,
are down 1.9% from 87.77 mmt (23.5% S/U) in “old crop” MY 2017/18, and is down 3.5% from 89.18 mmt
(24.6% S/U) in MY 2016/17.
Figure 1. JANUARY 2019 & NOVEMBER 2019 CME Daily Soybean Futures Price Charts
ne …
December 21, 2018
Grain Market Outlook
13, 2018 are down 30.1% from the level of a year ago.
Given a deepening tightness in exportable South American soybean supplies until the availability of 2019
crop supplies in late‐winter and spring months, it is likely that China will purchase substantial quantities of U.S.
soybeans during the mid‐December 2018 through March 2019 period. However, either 1) a breakdown in
U.S.‐Chinese negotiations during that period, or 2) prospects for a large 2019 South American soybean harvest,
may lead to sharply curtailed U.S. soybean exports during March‐April 2019.
No. 4 Factor – The Size of 2019 South America Soybean Production
With an opportunity to sell soybeans to China given their distinct preference for imports from non‐U.S.
sources, key South American soybean producing countries such as Argentina and Brazil have reportedly
increased plantings for their 2019 soybean crops. In Brazil, initial estimates in October from private sources
and the USDA are for a 1.0% increase in production to 120.4‐120.5 million metric tons (mmt), up from the
USDA estimate 119.8 mmt in 2018 (Figure 15).
Weather risks / threats to South American 2019 production will have to be dealt with over the coming
months – with some negative effects on Argentina and Brazil production prospects already having appeared.
However, Current intentions and frankly – market expectations ‐ are for South American soybean production
Page | 3
to increase in 2019 – which would further increase the negative prospects for U.S. soybean prices in the later
part of “Current” MY 2018/19 (Figures 17a‐b).
Impact on U.S. Corn & Soybean Acres in 2019? Planting of the 2019 South American soybean crop started
in late fall 2018, with the later stages of crop development to occur in February‐March 2019. This means that
U.S. corn and soybean producers will have some amount of information on 2019 South American crop
production and market prospects when they make crop planting decisions in late winter – early spring 2019
here in the United States. All else being equal, anticipated increases in 2019 South American soybean acreage
and production prospects MAY lead U.S. farmers to take a more pessimistic view of U.S. soybean market price
prospects for Fall 2019, and cause them to lower their 2019 U.S. soybean plantings and to raise their 2019 U.S.
corn plantings.
No. 5 Factor – The Size of 2019 U.S. Soybean Planted Acres & Production
In its Long Term Agricultural Projections released in fall 2018 the USDA forecast that U.S. soybean planted
acres will decline to 82.500 million acres (ma) in 2019, down from 89.145 ma in 2018, 90.142 ma in 2017,
83.433 ma in 2016, and 82.650 ma in 2015 (Table 1a, Figure 5). The USDA also forecast that 2019 U.S. soybean
production would be 4.090 bb – the 4th highest on record, down from the estimated record high of 4.600 bb in
2018, 4.411 bb in 2017, and 4.296 bb in 2016 (Table 1 & 1a, Figure 7).
With 2019 U.S. soybean plantings to occur in Spring 2019, there is still a sizable amount of uncertainty
about U.S. farmer’s final 2019 planting decisions to come. Factors such as: 1) a potential drought and reduced
production prospects in South America in early 2019, 2) a resumption of normal, non‐conflicting U.S.‐China
trade relations, 3) the impact on farmers’ crop profitability expectations from market loss compensation
payments by the U.S. government to them, or other factors could affect the motivation of U.S. farmers to plant
soybeans in 2019.
The final level of 2019 U.S. soybean plantings will be a significant factor affecting U.S. and World soybean
supply‐demand and price prospects for calendar year 2019 and for “next crop” MY 2019/20.
2. Other Factors to Consider in Soybean Market Outlook
a …
March 25, 2015
Commodity Program Papers
with their
marketing and riskmanagement decisions. Therisk of loss in
trading futures … addition to market price risk, there is
also the possibility …
July 27, 2012
Macro and Global Economic Perspectives
around these big issues.
Risk Matrix of Your Responses … P
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• Think of the risk matrix has being segmented … Intuition of the Risk Matrix
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