Agriculture
Pat Westhoff, FAPRI director, says the analysis shows that new-crop corn prices will average near $5 per bushel, down from $7 for the crop harvested last fall. FAPRI?s projected corn price, however, assumes corn is planted on 96.9 million acres, which would be the second highest to 2012?s record, and a return to trend yields of 162 bushels per acre.
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Agriculture
Pray for Rain? Think Again
Favorable weather this growing season could shave $2 per bushel off the price of corn as bins, silos, and ag bags are filled to the max with a record-large corn crop. That?s the conclusion of a recent report by the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri.
Pat Westhoff, FAPRI director, says the analysis shows that new-crop corn prices will average near $5 per bushel, down from $7 for the crop harvested last fall. FAPRI?s projected corn price, however, assumes corn is planted on 96.9 million acres, which would be the second highest to 2012?s record, and a return to trend yields of 162 bushels per acre. Last year, the average yield was only 123 bushels due to large areas of drought, and 2012 was the third year in a row that the average corn yield fell below trend, Westhoff notes. A record corn crop would allow stocks to build, sending prices sharply lower.
The FAPRI report, U.S. Baseline Briefing Book Projections for Agricultural and Biofuel Markets, was released earlier this month.
FAPRI also conducted a stochastic analysis in which computers come up with 500 potential outcomes that showed annual corn prices were below $3.50 per bushel 10 percent of the time and above $6 per bushel 10 percent of the time over the 10-year forecast period beginning in 2013. But Westhoff notes that actual volatility could be even greater.
Beginning in 2014 and continuing through 2022, average grain and oilseed prices are projected to remain well below the record levels of 2012-13, the report notes. However, they are also expected to be well above the average prices prior to 2007. Corn prices, for instance, during the forecast period average just under $5 per bushel.
Ethanol production in 2013-14 is projected to rebound significantly assuming that the biofuel mandates are enforced. "The value of the certificates used to demonstrate mandate compliance must rise substantially to cover the discount needed to sell fuels containing more than 10 percent ethanol," says the report. Ethanol production for the 2013-14 crop year grows a sharp 16 percent to 14.4 billion gallons. By the end of the forecast period, however, ethanol production is expected to hit only 15.7 billion gallons, slightly more than a 1 percent annual growth rate.
Farm income in 2013 is expected to continue strong for the third back-to-back year. "Net farm income, a measure that includes changes in the values of inventories, reaches a record $131 billion in 2013, while net cash income reached its record level in 2012. Both net income measures retreat slightly in 2014 in response to lower crop prices and receipts," the report notes.
Source: http://www.agweb.com
- Tomato Price Registers Record 84 Percent Hike In July
September 03, 2013 Price of tomatoes increased by 84 percent in July as compared to June 2013. Heavy rainfall and flood in various parts of the country are said to be the factors behind low tomato yield leading to its import and thus a higher price, says...
- Wheat Imports From Pakistan May Climb To Highest In Five Years
Wednesday, July-10-2013 Wheat imports by Pakistan, Asia?s third-largest producer, may climb to the highest level in five years after a declined in the harvest boosted local prices, according to a traders group. ?We may import up to 500,000 tons of wheat...
- A View On Global Wheat Production
According to Informa Economics report released recently shows that the 2009/10 year (April to next March) Global wheat production is projected at 666.8 million tons, down from an earlier forecast of 662.4 million tons By contrast, last year the world...
- Corn Belt
"It's been 28 degrees for about an hour in north-central Iowa. In the low-lying areas, it has a coating of frost. I would call it a killing frost there," says Agriculture.com Marketing Talk senior contributor BA Deere. "My corn is black layered, beans...
- Indiana Looking Up...
"The hope is that corn prices are lower by fall," said the Purdue University agricultural economist last Friday. "If we can see a crop that is a normal crop this year ... while the price of hogs drops to $60 in late 2011 and early 2012, corn might drop...