YardLimits.com - General Discussion

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CORN

Corn sales are expected to continue their decline from 2008’s high as the average annual price is expected to decline 33 cents per bushel. The 2010 corn crop is forecast to set new records for yield and total bushels, resulting in plentiful supplies. Annual use of corn for food, seed, and industrial purposes, as well as U.S. corn exports, is expected to increase starting in the latter part of 2010. Alcohol for fuel use is expected to increase 4.4 percent for the crop year starting in the latter part of 2010 after experiencing a 21.3 percent increase in the previous crop year. A slight increase is projected for the index of grain-consuming animal units (GCAU) beginning in the latter part of 2010 due to an increase in broiler production while grain used per GCAU is expected to decline. Several factors point to strong export demand for corn beginning in the latter part of the year: reduced availability of barley and low-price wheat, high domestic corn prices in China, and a dropoff in wheat production in the former Soviet Union. Reductions in wheat production mean less wheat is used as feed, boosting the demand for corn.

WHEAT

Sales of U.S. wheat are expected to decline over $1 billion in 2010. The annual average price for U.S. wheat is expected to fall 50 cents per bushel while quantities sold are expected to increase 0.2 percent. Prices are expected to be higher in the latter part of 2010 when over 60 percent of wheat is expected to be sold in the open market. The 2010 all wheat planted area is forecast down 9 percent from 2009. Total domestic use is expected to slightly rebound in the 2010 crop marketing year, while exports are expected to increase 36 percent.

SOYBEANS

Soybean sales in 2010 are expected to reach a record annual value. An 8.8-percent increase in soybeans sold will more than offset an expected decline of almost 70 cents per bushel in the U.S. annual average price. Farmers are expected to harvest a record amount of soybeans in 2010 with the U.S. average yield matching last year’s record. U.S. sales commitments for exports starting in the latter part of 2010 are ahead of the record set in 2009. Soybean oil use fell over the first half of 2010 as domestic use lagged last year’s demand because of low use for biodiesel, although edible consumption has grown slowly. Demand may overtake production in the latter part of 2010 if there is a strong recovery in U.S. biodiesel production prompted by the higher 2011 mandates in the Renewable Fuel Standard.

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