April 18, 2014
Is There An Advantage To More Corn Acres in Your Rotation?
The Midwest is very oriented to the production of corn and soybeans. As the price of corn and soybeans vary and as the cost of inputs to produce those two crops vary, farmers construct budgets to estimate the revenue and expenses of those two crops as they compete against each other for acres in the Midwest. The competition for acres is driven by several things including agronomic factors and profitability.Posted by Brandy M. Krapf, Dwight D. Raab and Bradley L. Zwilling
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April 17, 2014
Mapping the Farm Bill: Voting in the House of Representatives
Previous posts in this series looked at issues shaping the fate of the farm bill prior to passage, including shifts in the political landscape and the debate over the Supplemental Nutrition Assistance Program (SNAP). On January 29, 2014, the House of Representatives agreed to the conference report for the farm bill. It passed the Senate on February 4th and was signed by President Obama on February 7th. Ink from the President's pen propelled the Agricultural Act of 2014 into law and much attention now focuses on understanding the bill's provisions and on its implementation. This post revisits the use of mapping technology to gain a better understanding of this farm bill's dynamics by comparing specific farm bill votes in the House of Representatives.Posted by Todd Kuethe and Jonathan Coppess
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April 16, 2014
RIN Stocks Part I - Valuation
In a recent post, Nick Paulson updated his estimate of RIN production (i.e., "Net-generation", or production and importation of eligible biofuels less exported gallons) and carry-in RIN stocks for 2014. RIN stocks were drawn down in 2013 due to the blendwall and drought. Such drawdown left a smaller inventory on-hand for obligated parties to draw upon in 2014 to meet unexpected changes to supply or demand. However, the drawdown appears to be noticeably less than was anticipated in the proposed rule for 2014 volumes. The level of the carry-in and carry-out inventories and whether they are growing or shrinking have implications for biofuel mandates and consumption in 2014 and beyond.Posted by Rob Johansson and Seth Meyer
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April 15, 2014
Monthly Fertilizer Prices: Spring 2014 with Comparisons to 2009 through 2013
Fertilizer prices have been increasing in recent months; however, per acre fertilizer costs should be lower in 2014 than in recent years. In this post, monthly prices for anhydrous ammonia, diammonium phosphate (DAP), and potash are shown for 2009 through 2014. In most cases, monthly fertilizer prices in 2014 have been below prices for the 2011, 2012, and 2013 crop years. Prices suggest fertilizer costs for corn of $150 per acre in 2014, compared to costs near $200 per acre in 2012 and 2013.Posted by Gary Schnitkey
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April 14, 2014
Corn Consumption Continues to Exceed Projections
The USDA's WASDE report released on April 9 projected corn stocks at the end of the current marketing year at 1.331 billion bushels. The projection of year ending stocks has declined for five consecutive months and is now 556 million bushels smaller than the November 2013 projection. Compared to consumption projections made in November, current projections are 100 million bushels larger for corn used for ethanol production, 350 million bushels larger for exports, and 100 million bushels larger for feed and residual use. There have been minor changes in the estimate of stocks at the beginning of the marketing year, the projection of imports, and the projection of other domestic consumption.Posted by Darrel Good
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April 11, 2014
RIN Stock Update
In the most recent post looking at Renewable Identification Number (RIN) stock levels for 2014, the potential impact of EPA's proposed rulemaking for the 2014 Renewable Fuel Standard mandate levels was discussed. Today's post provides an update on RIN stocks and takes a look at the pace of RIN generation so far in 2014.Posted by Nick Paulson
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April 10, 2014
State Distribution of Direct vs. Net Crop Insurance Payments, 2004-2013
The 2014 farm bill replaced direct payments with risk management programs. Moreover, a key farm safety net policy and political factor is the distribution of program payments by state. This post therefore examines the distribution by state of direct payments and net crop insurance payments for the 2004-2013 crops.Posted by Carl Zulauf
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April 9, 2014
The Relationship between Planting Intentions, Actual Plantings, and Prevented Plantings over 2007-2013
The USDA's Prospective Plantings report of March 31 has stimulated an on-going conversation about the relationship between the magnitude of planting intentions estimates and the magnitude of final planted acreage estimates. In particular, the smaller than expected corn acreage in the March 31 report has prompted considerable discussion about the possibility of the USDA survey undercounting total acreage and this is the reason for the "low" figure for corn. In a farmdoc daily post last week, we examined the data and concluded that there does appear to be some room for planted acreage estimates for principal crops to exceed this year's estimate of planting intentions. Our analysis focused on the sampling variability inherent in "final" estimates of planted acreage.Posted by Darrel Good and Scott Irwin
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April 8, 2014
Recent Price Changes on Harvest-time Corn and Soybean Contracts
Futures prices for 2014 harvest-time contracts provide estimates of prices at 2014 harvest. During the past seven months, futures contract prices ranged by $.60 per bushel for corn and $1.00 per bushel for soybeans. This variation results in differences in revenue forecasts and can cause difficulty in decision making. While these price changes do cause difficulty, similar price changes should be expected in the future. Current futures price levels suggest near long-run price levels for 2014.Posted by Gary Schnitkey
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April 7, 2014
Pork: PEDv Losses Not As Large As Expected
The headline for the last USDA Hogs and Pigs report could have been: "PEDv Losses Not as Large as Expected." A week later, spring and summer lean futures are down nearly $10 per hundredweight, or about eight percent.Posted by Chris Hurt
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