With a tight supply and declining production in South America because of an ongoing drought, farmers in the United States are expected to boost the amount of acres they plant in corn, with Iowa farmers contributing significantly to those upwardly revised numbers.
Even so, the results of a coupld of recent surveys, one an online survey and the second a survey conducted at the Iowa Power Farming Show, show farmers in Iowa are looking to plant about 300,000 more acres than originally thought, a smaller increase than expected.
Iowa farmers also said they'll probably plant an additional 50,000 acres of beans.
What surprised those conducting the surveys is there has been a lot of talk by farmers in Iowa about boosting the number of acreage planted in corn. Evidently that was more talk than action being seriously considered by the farmers.
At the national level, farmers have been estimated they're going to boost corn acres planted by about 94.9 million acres, an increase of 2.9 million acres over 2011.
For soybeans, there isn't near as much change, with the number of acres projected to be planted nationally to rise by just over 500,000 to 75.5 million for 2012. In 2011, the number of acres planted in soybeans in the United States was just under 75 million.
The decision to plant more acreage isn't without risk though. If weather conditions are good, the increased number of acres planted in corn could push the price down.
Showing posts with label Iowa Corn. Show all posts
Showing posts with label Iowa Corn. Show all posts
Friday, February 17, 2012
Tuesday, January 31, 2012
Prime Iowa, Minnesota Corn Country Faces Drought
Prime corn-growing regions of Iowa and Minnesota are facing challenges similar to the last major drought in the region in 1988, causing some growing concern in a year starting with tight corn supply.
Some of the more productive parts of northwest Iowa and southern Minnesota are under pressure, and there's little relief seen to be coming at this time.
While the weather this year is in fact very similar to 1988, the one difference is it is happening earlier than that disastrous year, and so has more time to rebound if wetter weather arrives.
Of course if that doesn't happen, there will be some production and supply problems emerging from the area. If it continues, expectations are parts of eastern Nebraska could be affected as well, and it could spread from there; although that is more the worst case scenario.
In 1988, on average, the drought resulted in about 25 percent less yields for corn.
One major change in corn farming since than has been more drought-resistant corn seed, which should help alleviate some of the effects of dry weather.
That would make it better than 1988, but it would still have a major impact if the weather patterns don't change.
You can see on the map how conditons look at this time.
Some of the more productive parts of northwest Iowa and southern Minnesota are under pressure, and there's little relief seen to be coming at this time.
While the weather this year is in fact very similar to 1988, the one difference is it is happening earlier than that disastrous year, and so has more time to rebound if wetter weather arrives.
Of course if that doesn't happen, there will be some production and supply problems emerging from the area. If it continues, expectations are parts of eastern Nebraska could be affected as well, and it could spread from there; although that is more the worst case scenario.
In 1988, on average, the drought resulted in about 25 percent less yields for corn.
One major change in corn farming since than has been more drought-resistant corn seed, which should help alleviate some of the effects of dry weather.
That would make it better than 1988, but it would still have a major impact if the weather patterns don't change.
You can see on the map how conditons look at this time.
Friday, January 27, 2012
Iowa Corn Profits Projected Lower for 2012
Chad Hart, Iowa State University agricultural economist, said the outlook for corn profits for state farmers doesn't look as good as it did in 2011.
“In Iowa, we’re projecting season-average prices to range between $5.30 and $5.40/bu., and we’re projecting inputs costs to be about $4.40/bu. So, if that holds true, the market in Iowa will be offering 90¢-$1/bu. in profits to grow corn for 2012. Returns from growing corn in Iowa last year have averaged about $1.60/bu., but that corn is still being sold,” Hart said.
Economic uncertainty continues to weigh on corn overall corn profits, in Iowa, and elsewhere in the U.S. Prices could fall as low as $3 a bushel, but could rise as high as $7 a bushel, according to Hart.
All factors inputed, I would bet on a more downward movement in price than upward for corn in 2012.
“In Iowa, we’re projecting season-average prices to range between $5.30 and $5.40/bu., and we’re projecting inputs costs to be about $4.40/bu. So, if that holds true, the market in Iowa will be offering 90¢-$1/bu. in profits to grow corn for 2012. Returns from growing corn in Iowa last year have averaged about $1.60/bu., but that corn is still being sold,” Hart said.
Economic uncertainty continues to weigh on corn overall corn profits, in Iowa, and elsewhere in the U.S. Prices could fall as low as $3 a bushel, but could rise as high as $7 a bushel, according to Hart.
All factors inputed, I would bet on a more downward movement in price than upward for corn in 2012.
Friday, March 4, 2011
Iowa Corn Production Drops in 2010
Corn production in Iowa for 2010 was down from 2009 levels, coming in at 2.2 billion bushels, falling 267,000 bushels.
Final 2010 crop numbers released Tuesday by the U.S. Department of Agriculture show more soybeans were produced statewide and less corn compared to the previous year.
Local commodity prices responded in the exact opposite way some people might think.
Typically, commodity supplies affect prices. In this case, cash corn at East Central Iowa Cooperative based in Hudson dipped since Tuesday's report and soybeans have gone up.
Corn at Monday's close was $6.96 a bushel, compared to $6.87 Thursday afternoon in Hudson. Soybeans steadily climbed about 10 to 15 cents a bushel each day since Monday, from $13.01 a bushel to $14.41 Thursday afternoon.
When it comes to grain, a local commodity expert said supply is only a part of pricing.
"It's a small piece of the puzzle," said Brad Stewart, ECIC grain merchandiser. "We used to look at supply and demand to see what prices should be. Now, (buyers) look at next year to see what other countries will need for protein."
Iowa farmers produced 496.2 million bushels of soybeans last year, 10 million more than 2009. The average yield remained the same at 51 bushels per acre. Harvested acres increased by 200,000 in 2010 to 9.73 million.
Full Story
Final 2010 crop numbers released Tuesday by the U.S. Department of Agriculture show more soybeans were produced statewide and less corn compared to the previous year.
Local commodity prices responded in the exact opposite way some people might think.
Typically, commodity supplies affect prices. In this case, cash corn at East Central Iowa Cooperative based in Hudson dipped since Tuesday's report and soybeans have gone up.
Corn at Monday's close was $6.96 a bushel, compared to $6.87 Thursday afternoon in Hudson. Soybeans steadily climbed about 10 to 15 cents a bushel each day since Monday, from $13.01 a bushel to $14.41 Thursday afternoon.
When it comes to grain, a local commodity expert said supply is only a part of pricing.
"It's a small piece of the puzzle," said Brad Stewart, ECIC grain merchandiser. "We used to look at supply and demand to see what prices should be. Now, (buyers) look at next year to see what other countries will need for protein."
Iowa farmers produced 496.2 million bushels of soybeans last year, 10 million more than 2009. The average yield remained the same at 51 bushels per acre. Harvested acres increased by 200,000 in 2010 to 9.73 million.
Full Story
Friday, October 8, 2010
Corn Prices and Iowa Corn Outlook
Corn prices soared to the 30-cent per bushel limit to $5.28 on the opening of the Chicago Board of Trade Friday after the USDA lowered its estimate of Iowa’s per bushel corn yield from 179 bushels per acre last month to 169 bushels per acre.
Soybeans soared as well, rising 70 cents per bushel to $11.35. Both corn and soybean prices are at their highs for the year.
The corn yield estimate, if confirmed in the final post-harvest tally by the USDA in January, would represent a 7 percent drop from the 2009 harvest.
Last year Iowa farmers averaged 182 bushels per acre.
The USDA lowered its national per-bushel estimates from 162.5 bushels per acre to 156 bushels.
Commodity analyst Arlan Suderman of Farm Futures Magazine called the USDA report “shocking.”
Don Roose of US Commodities in West Des Moines called the report “a game changer.”
“This means that there will be tight supplies and a real battle for corn acres next spring,” said Roose, who added that the price for the March contract on corn could reach $6 per bushel.
Des Moines commodity broker Tomm Pfitzenmaier of Summit Commodities said “the USDA was expected to lower their yield estimates, but no one expected them to lower it this much all at once.”
Darin Newsome of DTN in Omaha called the USDA report “extremely bullish for corn, with a possible limit move. Domestic ending stocks to use are the second lowest on record. Soybeans and wheat also saw bullish numbers, leading to expectations of large gains in all three grain markets.”
Iowa is the nation’s largest producer of both corn and soybeans. Together the two crops contribute about $15 billion in cash to Iowa’s economy.
The report and surge in grain prices made itself felt on the stock market. Deere & Co., Iowa’s largest manufacturing employer, was up $4.24 per share to $76.14. Monsanto, owner of the DeKalb and Asgrow seed lines and whose stock has been under pressure this year, rose $2.37 in early trading. DuPont, owner of Johnston-based Pioneer Hi-Bred, was up 44 cents per share to $46.67.
While the higher prices for corn will help farmers make up financially for the lower yields, the increased grain costs will work against the margins for Iowa’s hog and cattle producers as well as the state’s 40 ethanol plants.
Livestock producers are enjoying their first profitable year since 2007, predicated on both better market prices but also moderate corn prices. Record corn prices in 2007 and 2008 triggered three years of losses for hog and cattle raisers.
The higher corn prices had a predictable effect on cattle prices. Feeder cattle, those six months of age or older who are sent to feedlots to be fattened, were down $2.57 per hundredweight to $106.55 in early trading in Chicago.
This year’s corn and soybeans crops were hobbled by record rainfall in July, which flooded many plants just as they were pollinating. Then an unexpected cold snap in late July interfered with some pollination.
Because crops were planted earlier this year during mild weather at the beginning of April, the Iowa corn harvest had begun earlier than usual.
The smaller crop raises the specter of short supplies. Dick Gallagher of Washington, chairman of the Iowa Corn Promotion Board, said “I think, even with the slight down tick, I am confident we have the corn we need.”
Concerns about the supply of corn due to the poorer harvest had driven up the price of corn from $3.45 per bushel in June to above $5 per bushel last month. Then a week ago the USDA reported 300 million more bushels of corn in storage from last year that hadn’t been reported previously.
The USDA said that the nationwide corn harvest would be 12.7 billion bushels, down 4 percent from 2009.
Soybeans soared as well, rising 70 cents per bushel to $11.35. Both corn and soybean prices are at their highs for the year.
The corn yield estimate, if confirmed in the final post-harvest tally by the USDA in January, would represent a 7 percent drop from the 2009 harvest.
Last year Iowa farmers averaged 182 bushels per acre.
The USDA lowered its national per-bushel estimates from 162.5 bushels per acre to 156 bushels.
Commodity analyst Arlan Suderman of Farm Futures Magazine called the USDA report “shocking.”
Don Roose of US Commodities in West Des Moines called the report “a game changer.”
“This means that there will be tight supplies and a real battle for corn acres next spring,” said Roose, who added that the price for the March contract on corn could reach $6 per bushel.
Des Moines commodity broker Tomm Pfitzenmaier of Summit Commodities said “the USDA was expected to lower their yield estimates, but no one expected them to lower it this much all at once.”
Darin Newsome of DTN in Omaha called the USDA report “extremely bullish for corn, with a possible limit move. Domestic ending stocks to use are the second lowest on record. Soybeans and wheat also saw bullish numbers, leading to expectations of large gains in all three grain markets.”
Iowa is the nation’s largest producer of both corn and soybeans. Together the two crops contribute about $15 billion in cash to Iowa’s economy.
The report and surge in grain prices made itself felt on the stock market. Deere & Co., Iowa’s largest manufacturing employer, was up $4.24 per share to $76.14. Monsanto, owner of the DeKalb and Asgrow seed lines and whose stock has been under pressure this year, rose $2.37 in early trading. DuPont, owner of Johnston-based Pioneer Hi-Bred, was up 44 cents per share to $46.67.
While the higher prices for corn will help farmers make up financially for the lower yields, the increased grain costs will work against the margins for Iowa’s hog and cattle producers as well as the state’s 40 ethanol plants.
Livestock producers are enjoying their first profitable year since 2007, predicated on both better market prices but also moderate corn prices. Record corn prices in 2007 and 2008 triggered three years of losses for hog and cattle raisers.
The higher corn prices had a predictable effect on cattle prices. Feeder cattle, those six months of age or older who are sent to feedlots to be fattened, were down $2.57 per hundredweight to $106.55 in early trading in Chicago.
This year’s corn and soybeans crops were hobbled by record rainfall in July, which flooded many plants just as they were pollinating. Then an unexpected cold snap in late July interfered with some pollination.
Because crops were planted earlier this year during mild weather at the beginning of April, the Iowa corn harvest had begun earlier than usual.
The smaller crop raises the specter of short supplies. Dick Gallagher of Washington, chairman of the Iowa Corn Promotion Board, said “I think, even with the slight down tick, I am confident we have the corn we need.”
Concerns about the supply of corn due to the poorer harvest had driven up the price of corn from $3.45 per bushel in June to above $5 per bushel last month. Then a week ago the USDA reported 300 million more bushels of corn in storage from last year that hadn’t been reported previously.
The USDA said that the nationwide corn harvest would be 12.7 billion bushels, down 4 percent from 2009.
Subscribe to:
Posts (Atom)