corn & ethanol
DESCRIPTION
Corn & Ethanol. June 2013. Corn Price History. Corn Supply & Demand. Late Start For Corn Planting. December Corn In Past Late Planted Years. December Corn Prices. December Corn Prices. Growing Season Weather Expectations. Corn vs. Ethanol. Ethanol Margins. - PowerPoint PPT PresentationTRANSCRIPT
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Corn & Ethanol
June 2013
www.BeesonInc.com Commodity Complexity Solved. (502) 241-8460
2527 Nelson Miller Parkway | Suite 204 | Louisville, KY 40223
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2
Corn Price History
$5.00
$5.50
$6.00
$6.50
$7.00
$7.50
$8.00
$8.50
12-J
un
23-J
ul
2-S
ep
13-O
ct
23-N
ov
3-Ja
n
13-F
eb
26-M
ar
6-M
ay
do
llars
/ b
us
he
l
Nearby Corn Futures
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Corn Supply & Demand
2006/07 2007/08 2008/09 2013/14May
Planted mil acres 78.3 93.5 86.0 86.5 88.2 91.9 97.2 97.3Harvested 70.6 86.5 78.6 79.6 81.4 84.0 87.4 89.5Yield 149.1 150.7 153.9 164.7 152.8 147.2 123.4 158.0
Production mil bu 10,531 13,038 12,092 13,092 12,447 12,358 10,780 14,140 Beginning Stocks 1,967 1,304 1,624 1,673 1,708 1,128 989 759 Supply 12,510 14,362 13,729 14,774 14,182 13,516 11,894 14,924
Feed Usage 5,591 5,913 5,182 5,125 4,795 4,548 4,400 5,325 Food Usage 3,490 4,387 5,025 5,961 6,426 6,437 5,985 6,295
Ethanol 2,119 3,049 3,709 4,591 5,019 5,011 4,600 4,850
Exports 2,125 2,437 1,849 1,980 1,834 1,543 750 1,300
Total Usage 11,207 12,737 12,056 13,066 13,054 12,527 11,135 12,920
Ending Stocks 1,304 1,624 1,673 1,708 1,128 989 759 2,004 Ending Stocks / Use 12% 13% 14% 13% 9% 8% 7% 16%
U.S. Corn Balance Sheet2010/112009/10 2011/12 2012/13
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Late Start For Corn Planting
0
20
40
60
80
100
1-A
pr
8-A
pr
15
-Ap
r
22
-Ap
r
29
-Ap
r
6-M
ay
13
-Ma
y
20
-Ma
y
27
-Ma
y
3-J
un
% C
om
ple
teUS Corn Planting Progress
5-yr ave
2012
2013
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210
220
230
240
250
260
270
280
290
300Ja
n-93
Feb
-93
Mar
-93
Ap
r-93
May
-93
Jun-
93
Jul-9
3
Aug
-93
Sep
-93
Oct
-93
No
v-93
Dec
-93
December 1993 Corn Futures
cen
ts /
bu
shel
December 1993 Corn Futures
cen
ts /
bu
shel
cen
ts /
bu
shel
220
240
260
280
300
320
340
360Ja
n-95
Feb
-95
Mar
-95
Ap
r-95
May
-95
Jun-
95
Jul-9
5
Aug
-95
Sep
-95
Oct
-95
No
v-95
Dec
-95
December 1995 Corn Futures
cen
ts /
bu
shel
cen
ts /
bu
shel
cen
ts /
bu
shel
240
260
280
300
320
340
360
380
400Ja
n-96
Feb
-96
Mar
-96
Ap
r-96
May
-96
Jun-
96
Jul-9
6
Aug
-96
Sep
-96
Oct
-96
No
v-96
Dec
-96
December 1996 Corn Futures
cen
ts /
bu
shel
cen
ts /
bu
shel
cen
ts /
bu
shel
December Corn In Past Late Planted Years
200
210
220
230
240
250
260
270
280
290
300
Jan-
02
Feb
-02
Mar
-02
Ap
r-02
May
-02
Jun-
02
Jul-0
2
Aug
-02
Sep
-02
Oct
-02
No
v-02
Dec
-02
December 2002 Corn Futures
cen
ts /
bu
shel
cen
ts /
bu
shel
cen
ts /
bu
shel
250
350
450
550
650
750
850
Jan-
08
Feb
-08
Mar
-08
Ap
r-08
May
-08
Jun-
08
Jul-0
8
Aug
-08
Sep
-08
Oct
-08
No
v-08
Dec
-08
December 2008 Corn Futures
cen
ts /
bu
shel
cen
ts /
bu
shel
cen
ts /
bu
shel
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December Corn Prices
$3.50
$4.50
$5.50
$6.50
$7.50
$8.50
$9.50
2004
1994
1992
1982
1985
1986
1981
2008
2005
2006
2007
1998
2000
2001
1989
1999
1984
1997
2011
1991
1993
1983
1988
2012
Dec Corn Range in Jun-Sep From May LowYears Where Market Falls Lower In May
2013 May Low = $5.12
greater than trend yield below trend
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December Corn Prices
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
2004
1994
1992
1982
1985
1986
1981
2008
2005
2006
2007
1998
2000
2001
1989
1999
1984
1997
2011
1991
1993
1983
1988
2012
Dec Corn Range in Oct-Dec From May LowYears Where Market Falls Lower In May
2013 May Low = $5.12
greater than trend yield below trend
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Growing Season Weather Expectations
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Corn vs. Ethanol
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$1.00
$1.20
$1.40
$1.60
$1.80
$2.00
$2.20
$2.40
$2.60
$2.80
$3.00Ja
n-12
Feb-
12
Mar
-12
Apr-
12
May
-12
Jun-
12
Jul-1
2
Aug-
12
Sep-
12
Oct
-12
Nov
-12
Dec-
12
Jan-
13
Feb-
13
Mar
-13
Apr-
13
May
-13
Ethanol
Corn
do
llars
/ g
allo
nd
olla
rs / b
us
he
lEthanol & Corn Price History
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Ethanol Margins
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Corn vs. Ethanol (futures 1/1/2012 forward)
y = 4.0347x - 2.3624R² = 0.8786
$5.00
$5.50
$6.00
$6.50
$7.00
$7.50
$8.00
$8.50
$9.00
$1.90 $2.00 $2.10 $2.20 $2.30 $2.40 $2.50 $2.60 $2.70 $2.80
Corn Correlation to Ethanol Price
co
rn:
do
llars
/ b
us
he
l
ethanol: dollars / gallon
$5.00
$5.50
$6.00
$6.50
$7.00
$7.50
$8.00
$8.50
$9.00
$1.90 $2.00 $2.10 $2.20 $2.30 $2.40 $2.50 $2.60 $2.70 $2.80
Corn Correlation to Ethanol Price
co
rn:
do
llars
/ b
us
he
l
ethanol: dollars / gallon
Since 2/1/13
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Unleaded & Ethanol Price History
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00Ja
n-07
Jun-
07
Nov
-07
Apr-
08
Sep-
08
Feb-
09
Jul-0
9
Dec-
09
May
-10
Oct
-10
Mar
-11
Aug-
11
Jan-
12
Jun-
12
Nov
-12
Apr-
13
Ethanol
Unleaded
do
llars
/ g
allo
n
Unleaded & Ethanol Price History
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Relative Value
60%
65%
70%
75%
80%
85%
90%
95%
100%Ja
n-12
Feb-
12
Mar
-12
Apr-
12
May
-12
Jun-
12
Jul-1
2
Aug-
12
Sep-
12
Oct
-12
Nov
-12
Dec-
12
Jan-
13
Feb-
13
Mar
-13
Apr-
13
May
-13
Ethanol Futures / RBOB
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Ethanol Stocks
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US Oil- Supply
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World Oil Product- Supply
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Energy Storage
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Shale Plays in the US
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Unleaded Price (July Futures)
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Corn Breakeven vs RBOB
RBOB Price $2.10 $2.25 $2.40 $2.55 $2.70 $2.85 $3.00 $3.15 $3.30 $3.45
Ethanol / RBOB100% $5.29 $5.71 $6.13 $6.55 $6.97 $7.39 $7.81 $8.23 $8.65 $9.07
90% $4.71 $5.25 $5.80 $6.35 $6.90 $7.45 $7.99 $8.46 $9.01 $9.55
80% $4.12 $4.62 $5.13 $5.64 $6.14 $6.65 $7.15 $7.58 $8.08 $8.59
70% $3.53 $3.99 $4.46 $4.92 $5.39 $5.85 $6.31 $6.69 $7.16 $7.62
60% $2.94 $3.36 $3.79 $4.21 $4.63 $5.05 $5.47 $5.81 $6.23 $6.66
Corn Breakeven Price
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Natural Gas - Demand
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Energy Storage
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Natural Gas - Prices
$1.50
$1.75
$2.00
$2.25
$2.50
$2.75
$3.00
$3.25
$3.50
$3.75
$4.00
$4.25
$4.502-
Ap
r
24-A
pr
16-M
ay
7-Ju
n
29-J
un
21-J
ul
12-A
ug
3-S
ep
25-S
ep
17-O
ct
8-N
ov
30-N
ov
22-D
ec
13-J
an
4-F
eb
26-F
eb
20-M
ar
11-A
pr
3-M
ay
25-M
ay
do
llars
/ M
MB
tu
Nearby Natural Gas Futures
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Summary
Crude Oil
• Prices will be under pressure due to increasing supply
Ethanol
• Industry under-utilization will pressure ethanol prices
Corn
• Look for corn prices to reach near $4 per bu in Q4 2013