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Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 1
Grain Market Outlook
Stephen R. KoontzProfessor & extension economist
Department of Agricultural & Resource Economics
Colorado State University
http://webdoc.agsci.colostate.edu/koontz
Crop Insurance Workshops – CO & NE
November, 2013
DEC 2013 Corn Contract
DEC 2013 Corn @ $4.26¼/bu..
DEC 2013 Corn @ $6.40/bu..
Price Forecasts & 90% Confidence Intervals
Commodity 2013/14 2014/15
Corn $5.00/bu.$4.40‐$6.00
$4.25/bu.$3.50‐$5.25
Soybeans $13.00/bu.$11.00‐$16.25
$11.00/bu.$10.00‐$15.00
Wheat $7.00/bu.$6.50‐$8.00
$7.25/bu.$6.25‐$8.75
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 2
Cumulative Rainfall - Year
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 3
Cumulative Rainfall – 90 Days
Cumulative Rainfall – 60 Days
Outline
• Weather
• Feed Markets: Corn & Forage
• Wheat
• Soybeans
• Inputs & Land Values
• Short‐term & Long‐term Price Outlook
• Management Strategies
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 4
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 5
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 6
Weekly Corn Contract
The trading range for corn was $3.50-$6.00/bu. Except…
$8.00
$5.00
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 7
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 8
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 9
Weekly Crude Oil Contract
$150
$35
$80-$105
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 10
Weekly Gasoline Contract
Weekly Ethanol Contract
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 11
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 12
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 13
DEC 2013 Corn Contract
DEC 2013 Corn @ $4.26¼/bu.
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 14
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 15
DEC 2014 Corn Contract
Forecast $3.50-5.25/bu.…
Corn Outlook
• Current corn market priced like 2010‐12 never happened.
• Acreage next year? Rotation or fallow? Leverage, debt & recent purchases?
• Structural change for livestock?
• Price outlook – $4.75‐$5.50/bu. for 13/14. 14/15 @ $3.25‐$5.25/bu.
Weekly KC Wheat Contract
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 16
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 17
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 18
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 19
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 20
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 21
JUL 2014 KC Wheat Contract
Forecast $6.25-8.75/bu.
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 22
Wheat Outlook
• Four years of tighter U.S. & world stocks.
• Uncertainty about U.S. & world crop.
• Likely expansions in U.S. acreage.
• Strong demand.
• Good prices & strong basis – mainly upside potential.
• Forecasts
– JUL 2014 @ $7.25 with range $6.25‐8.75/bu.
Weekly Soybean Contract
Weekly Soybean Meal Contract
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 23
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 24
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 25
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 26
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 27
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 28
NOV 2013 Soybean Contract
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 29
NOV 2014 Soybean Contract
Oilseeds Outlook
• World production & consumption of oilseeds grows.
• Foreign production & trade of oilseeds grows.
• Stocks remain tight.
• Potential for much volatility.
• How many acres in 2014?
• $11.75/bu. soybeans. And volatility with the most downside risk…
• $10.00/bu. and $325/T are potential lows.
Grain Market OutlookCrop Insurance Workshop
November 12 & 13, 2013
Stephen R. KoontzColorado State University 30
Outlook Summary
• Corn: $4.40‐6.00/bu. for 2013/14 & $3.50‐$5.25/bu. for 2014/15.
• Hay: $200/T through winter.
• Wheat: $6.50‐$8.00/bu. for 2013/14 & $6.25‐$8.75/bu. for 2014/15.
• Soybeans: $11.00‐$16.25/bu. for 2013/14 & $10.00‐$15.00/bu. for 2014/15.
Contact and Link Information
http://webdoc.agsci.colostate.edu/koontz/