Grain Market Grain Market OutlookOutlook

Cover Your Acres Cover Your Acres ConferenceConference

Oberlin, KansasOberlin, Kansas

January 22-23, 2008January 22-23, 2008Daniel O’Brien & Mike WoolvertonDaniel O’Brien & Mike Woolverton

K-State Research and ExtensionK-State Research and Extensiondobrien@oznet.ksu.edu dobrien@oznet.ksu.edu mikewool@agecon.ksu.edumikewool@agecon.ksu.edu

Historic vs Current Grain Historic vs Current Grain Prices Prices

2000-06 USDAAverage 2007/08

Wheat $3.35 $6.45–$6.85

Corn $2.24 $3.70–$4.30

Grain Sorghum $2.20 $3.60–$4.20

Soybeans $5.66 $9.90–$10.90

Sunflowers $11.57 /cwt $19.60–$21.20

1 National marketing year average price per unit, 2000-2006.

WheatWheatMarketsMarkets

Oberlin, KS Cash Wheat Oberlin, KS Cash Wheat PricesPrices

Decatur Coop, Oberlin, KansasJan. 22, 2007 – Jan. 18, 2008Source: DTN Bid Analyzer

March 2008 HRW Wheat March 2008 HRW Wheat FuturesFutures

KCBT: April 2006-January 2008“2008 Old Crop March HRW Contract”

Contract Volume & Open Interest

July 2008 HRW Wheat July 2008 HRW Wheat FuturesFutures

KCBT: April 2006-January 2008“2008 New Crop July HRW Contract”

Contract Volume & Open Interest

U.S. Wheat Supply-DemandU.S. Wheat Supply-Demand 2005/06 2006/07 2007/08 Planted Ac. (mln.) 57.2 57.3 60.4 Harvested Ac (mln.) 50.1 46.8 51.0 Yield (bu./ac.) 42.0 38.7 40.5 Beg. Stocks 540 571 456 Production 2,105 1,812 2,067

Total Supplies 2,727 2,505 2,613 Food 914 933 945 Seed 78 81 86 Exports 1,009 909 1,175 Feed & Residual 154 125 115

Total Use 2,155 2,049 2,321 End Stocks (%S/U) (26%) 571 (22%) 456 (13%) 292 U.S. Ave. Farm $ $3.42 $4.26 $6.45-$6.85

U.S. Wheat Planted AcreageU.S. Wheat Planted Acreage1973-2007 1973-2007 + Projected 2008+ Projected 2008

20

40

60

80

100

120

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Mill

ion

Acr

es

U.S. Wheat Seedings Up 4%, but lower than expected 2007/08 Seedings of U.S. Hard Red Winter Wheat (-1%) (SRW up 21%)

Kansas HRW Acres Seeded down by 500K in 2007/08

U.S. Wheat YieldsU.S. Wheat Yields1973-2007 1973-2007 + Trend+ Trend

37.734.2

31.6

39.4 39.543.2 44.2

40.5

0

10

20

30

40

50

60

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Harvest Year

Bus

hels /

Acr

e

U.S. Trend Wheat Yields for 2008/09: 41 bu / ac

U.S. Wheat ProductionU.S. Wheat Production1973-2007 1973-2007 + Projected 2008+ Projected 2008

2.12.1

2.6

2.22.4

2.62.72.8

2.1

0.0

1.0

2.0

3.0

4.0

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Bill

ion

Bus

hels

Projected increase in U.S. Wheat Production in 2008/09(More U.S. Wheat Acres x Trend Yields)

U.S. Wheat ExportsU.S. Wheat Exports1973/74 thru 2007/08 Marketing Years1973/74 thru 2007/08 Marketing Years

1.38 1.42

1.771.59

1.351.24

1.09 1.16 1.18

0.0

0.5

1.0

1.5

2.0

2.5

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Bill

ion

Bus

hels

Strong Pace for U.S. Wheat Exports for 2007/08 Mktg Year to date Due to high $s, sharp declines expected in March-May 2008

World Wheat Supply-DemandWorld Wheat Supply-Demand2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

621 624

116 148

594 617

111 124

621 616

105 111

0

200

400

600

800

Production Use Exports Ending Stocks

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

30 year low for World Wheat Ending Stocks (since 1977/78)

"Some" Price Rationing of Wheat Export Purchases

Production of World Wheat Production of World Wheat ExportersExporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

30

60

90

120

150

Mill

ion

Met

ric

Ton

s

EU-27 U.S. Canada Australia Argentina FSU-12

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

Unchanged-Declining 2007/08 Wheat Productionfor World's Major Wheat Exporters

Exports of World Wheat Exports of World Wheat ExportersExporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

5

10

15

20

25

30

35

Mill

ion

Met

ric

Ton

s

EU-27 U.S. Canada Australia Argentina FSU-12

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

U.S. Only Major Wheat Exporter which increased Sales in 2007/08

U.S. Wheat Ending Stocks U.S. Wheat Ending Stocks Wheat Ending Stocks as a % of UsageWheat Ending Stocks as a % of Usage

272220 2017 1619 13

0

20

40

60

80

100

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s to

Use

60 Year Low U.S. Wheat Ending Stocks13% Stocks/Use @ 292 mln bu

U.S. Wheat Stocks/Use% vs U.S. Wheat Stocks/Use% vs PricePrice

$3.99$3.72

$4.50

$3.56

$3.42

$4.26

$6.65

0

20

40

60

80

100

120

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s/U

se

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

U.S

. W

hea

t $

U.S. Wheat Ending Stocks to Use % U.S. Wheat Price

Record 2007/08 U.S. Wheat Price: $6.45 - $6.85 /bu @ 13% Stocks/Use

Soybean Soybean MarketsMarkets

Oberlin, KS Cash Oberlin, KS Cash Soybean $sSoybean $s

Decatur Coop - Oberlin, KansasJan. 22, 2007 – Jan. 18, 2008Source: DTN Bid Analyzer

Bird City, KS New Crop Bird City, KS New Crop SF $sSF $s

Frontier Equity Coop Exchange – Bird City, KansasNew Crop Oil-Type Sunflower BidsJan. 22, 2007 – Jan. 18, 2008Source: DTN Bid Analyzer

March 2008 Soybean March 2008 Soybean FuturesFutures

CBOT: October 2006-January 2008“2008 Old Crop Soybean Contract”

Contract Volume & Open Interest

November 2008 Soybean November 2008 Soybean FuturesFutures

CBOT: January 2006-January 2008“2008 Old Crop Soybean Contract”

Contract Volume & Open Interest

U.S. Soybean Supply-U.S. Soybean Supply-DemandDemand

2005/06 2006/07 2007/08 Planted Ac. (mln.) 72.0 75.5 63.6 Harvested Ac (mln.) 71.3 74.6 62.8 Yield (bu./ac.) 43.0 42.7 41.2 Beg. Stocks 256 449 574 Production 3,063 3,188 2,585

Total Supplies 3,322 3,647 3,165 Crushings 1,739 1,806 1,830 Exports 940 1,118 995 Seed 93 78 86 Residual 101 70 79

Total Use 2,873 3,073 2,990 End Stocks (%S/U) (16%) 449 (19%) 574 (6%) 175 U.S. Ave. Farm $ $5.66 $6.43 $9.90-$10.90

U.S. Soybean Planted U.S. Soybean Planted AcreageAcreage

1973-2007 1973-2007 + Projected 2008+ Projected 2008

74.370.971.4 75.5

63.670.0

0

25

50

75

100

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07 '09

Marketing Year

Mill

ion

Acr

es

Recovery in U.S. Soybean Acres Expected for 2008/09

U.S. Soybean YieldsU.S. Soybean Yields1973-2007 1973-2007 + Trend+ Trend

39 403834

28 29 31 3237

41 43 41

0

10

20

30

40

50

60

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Harvest Year

Bush

els / A

cre

U.S. Trend Soybean Yield for 2008/09: 42 bu/acre

U.S. Soybean ProductionU.S. Soybean Production1973-2007 1973-2007 + Projected 2008+ Projected 2008

2.62.9

3.23.12.92.7

2.5

2.12.22.3

1.81.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Bill

ion

Bus

hels

Higher U.S. Soybean Production Expected for 2008/09

U.S. Soybean ExportsU.S. Soybean Exports1973/74 thru 2007/08 Marketing Years1973/74 thru 2007/08 Marketing Years

622

838

539

700

875929804

882973

1064 11031118995

0

250

500

750

1000

1250

1500

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Million

Bush

els

Foreign Demand for U.S. Soybeans WeakeningSlower Exports Expected for rest of 2007/08 Mktg Year

World Soybean Supply-World Soybean Supply-DemandDemand

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

220 215

64 53

236 225

71 62

220235

7646

0

50

100

150

200

250

300

Production Use Exports Ending Stocks

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

Decreasing World ProductionIncreasing Use & ExportsDeclining Ending Stocks

Production of World Soybean Production of World Soybean ExportersExporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

20

40

60

80

100

Mill

ion

Met

ric

Ton

s

U.S. Brazil Argentina

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

Brazil 2007/08 Acres up 3.9% to 21.5 mln hectares(500K h. less than expected)

Exports of World Soybean Exports of World Soybean ExportersExporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

10

20

30

40

U.S. Brazil Argentina

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

Not as large an increase in Brazilian soybean production as expected has diminished Export prospects & pushed World Soybean $Prices higher

Record Prospects for Argentina Soy Exports

U.S. Soybean Ending StocksU.S. Soybean Ending StocksSoybean Ending Stocks as a % of UsageSoybean Ending Stocks as a % of Usage

19

71010 10 9988 7 646 6

16

0

10

20

30

40

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s to

Use

Sharp Reduction in 2007/08 Soybean Stocks (175 mb, 6% S/U): lowest since 2003/04 (112 mln bu)

U.S. Soybean Stocks/Use% U.S. Soybean Stocks/Use% vs Pricevs Price

$6.64$6.81

$7.57 $7.83$7.42 $7.35

$10.40

$6.43

$7.34

0

5

10

15

20

25

30

35

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s/U

se

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

U.S

. S

oyb

ean

$

Stocks/Use% U.S. Soybean Price

Record High U.S. Soybean Price: $9.90 - $10.90 /bu

Oberlin, KS Corn Cash Oberlin, KS Corn Cash PricesPrices

Decatur Coop, Oberlin, KSJan. 22, 2007 – Jan. 18, 2008Source: DTN Bid Analyzer

Oberlin, KS Grain Sorghum Oberlin, KS Grain Sorghum Cash PricesCash Prices

Decatur Coop, Oberlin, KSJan. 22, 2007 – Jan. 18, 2008Source: DTN Bid Analyzer

March 2008 Corn FuturesMarch 2008 Corn Futures

CBOT: February 2006-January 2008“2008 Old Crop Corn Contract”

Contract Volume & Open Interest

December 2008 Corn December 2008 Corn FuturesFutures

CBOT: April 2006-December 2007“2008 New Crop Corn Contract”

Contract Volume & Open Interest

U.S. Corn Supply-DemandU.S. Corn Supply-Demand 2005/06 2006/07 2007/08 Planted Ac. (mln.) 81.8 78.3 93.6 Harvested Ac (mln.) 75.1 70.6 86.5 Yield (bu./ac.) 148.0 149.1 151.1 Beg. Stocks 2,114 1,967 1,304 Production 11,114 10,535 13,074

Total Supplies 13,237 12,514 14,393 Ethanol 1,603 2,117 3,200 Other Food, Seed, Indust. 1,378 1,371 1,355 Exports 2,134 2,125 2,450 Feed & Residual 6,155 5,598 5,950

Total Use 11,270 11,210 12,955 End Stocks (%S/U) (17%) 1,967 (12%) 1,304 (11%) 1,438 U.S. Ave. Farm $ $2.00 $3.04 $3.70-$4.30

Dynamics of U.S. Corn UsageDynamics of U.S. Corn Usage USDA USDAUSDA USDA 2006/072006/07 2007/08 2007/08

est.est.

Feed and Residual 5,598 5,9501 (+6%) Food, Seed, and Industrial 1,371 1,3552 ( 1%־ ) Ethanol for Fuel 2,117 3,200 (+51%) Net Exports 2,125 2,450 (+15%) Ending Stocks 1,304 1,438 (+10%) Total Usage 11,210 12,995 (+16%)

Production 10,535 13,074 (+24%)1 Assumes DDGS retain 30% of the feed value of corn and are included in the feed

and residual category by the USDA. 2 Industrial, food, and seed less ethanol.

U.S. Grain Sorghum Supply-U.S. Grain Sorghum Supply-DemandDemand

2005/06 2006/07 2007/08 Planted Ac. (mln.) 6.5 6.5 7.7 Harvested Ac (mln.) 5.7 4.9 6.8 Yield (bu./ac.) 68.5 56.2 74.2 Beg. Stocks 57 66 32 Production 393 278 505

Total Supplies 450 343 537 Food, Seed, Indust. 50 45 35 Exports 194 157 285 Feed & Residual 140 109 175

Total Use 384 311 495 End Stocks (%S/U) (17%) 66 (10%) 32 (9%) 42 U.S. Ave. Farm $ $1.86 $3.29 $3.60-$4.20

U.S. Corn Planted AcreageU.S. Corn Planted Acreage1973-2007 1973-2007 + Projected 2008+ Projected 2008

88.0

93.6

50.0

60.0

70.0

80.0

90.0

100.0

'73 '75'77 '79 '81'83 '85 '87'89 '91'93'95 '97 '99 '01'03 '05'07 '09

Marketing Year

Million

Acr

es

U.S. Corn YieldsU.S. Corn Yields1973-2007 1973-2007 + Trend+ Trend

148138

127132142139

160151

0

30

60

90

120

150

180

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Harvest Year

Bush

els / A

cre

U.S. Corn ProductionU.S. Corn Production1973-2007 1973-2007 + Projected 2008+ Projected 2008

9.5

7.9 8.28.9

9.910.1

11.8 12.513.1

0.0

3.0

6.0

9.0

12.0

15.0

'73 '75 '77 '79 '81'83 '85 '87 '89 '91'93 '95 '97 '99 '01'03 '05 '07

Marketing Year

Bill

ion

Bus

hels

Record 2007 Corn ProductionProjected Decrease in 2008

U.S. Corn Food, Seed & U.S. Corn Food, Seed & Industrial UseIndustrial Use

1973/74 thru 2007/08 Marketing Years1973/74 thru 2007/08 Marketing Years

0.0

1.0

2.0

3.0

4.0

5.0

'73 '76 '79 '82 '85 '88 '91 '94 '97 '00 '03 '06

Marketing Year

Bill

ion

Bus

hels

Other Food, Seed, Industrial Use Ethanol

2007/08 Ethanol-related Use of Corn = 3.2 Billion Bushels25% of Total U.S. Corn Use

Estimated Bioenergy / Ethanol Use for 1973/74 - 2001/02

U.S. Ethanol Industry at a U.S. Ethanol Industry at a GlanceGlance

2006 2008 Number of operating ethanol plants: 97

137 Under construction or expanding: 35 70

Announced plants: 300(17%) 100(?)

Current production capacity: (BGPY) 4.8 7.6 Projected production capacity: 11.5 BGPY end of

2008 13.4 BGPY end of 2009

Feedstock Use Proportion:Corn 97%Sorghum 2%Other 1%

U.S. Corn ExportsU.S. Corn Exports1973/74 thru 2007/08 Marketing Years1973/74 thru 2007/08 Marketing Years

2.152.232.372.40 2.45

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Billion

Bush

els

325 Million Bu Increase (15%) in 2007/08 over 2006/07 ?

Total U.S. Corn UseTotal U.S. Corn Use1973/74 thru 2007/08 Marketing Years1973/74 thru 2007/08 Marketing Years

6.25.9

10.79.3

7.2

9.89.4

11.3

8.17.6

13.0

0.0

3.0

6.0

9.0

12.0

15.0

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

Billion

Bush

els

Total Use Over Trend in 2007/08 Due to Ethanol, Exports, etc.

World Corn Supply & DemandWorld Corn Supply & Demand

200

250

300

350

400

450

500

550

600

650

700

750

Production Consumption

Global production Global production up 9% from up 9% from 2006/07. Demand 2006/07. Demand up 7%up 7%

Production will be Production will be 6 MMT (240 mil. 6 MMT (240 mil. Bu.) less than Bu.) less than UsageUsage

World Ending World Ending Stocks to decrease Stocks to decrease 5.8 mmt from last 5.8 mmt from last year, down to 13 % year, down to 13 % of Usage.of Usage.

Million MT

World Coarse Grain Supply-World Coarse Grain Supply-DemandDemand

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

978 992

107165

981 1009

115 136

1052

119 126

1062

0

300

600

900

1200

1500

Production Use Exports Ending Stocks

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

World Coarse Grain S-D driven by U.S. Feedgrain S-D Trends:

Record World Corn Exports,…Lowest Ending Stocks in 30 Yrs

Production of World Coarse Production of World Coarse Grain ExportersGrain Exporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

50

100

150

200

250

300

350

400

U.S. Argentina Australia Canada Brazil China FSU-12

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

Major Increase in U.S. Coarse Grain Production

Record '07 Canada Corn

Crop

Exports of World Coarse Grain Exports of World Coarse Grain ExportersExporters

2005/06 thru 2007/08 Marketing Years2005/06 thru 2007/08 Marketing Years

0

10

20

30

40

50

60

70

80

U.S. Argentina Australia Canada Brazil China FSU-12

Mill

ion

Met

ric

Ton

s

'2005/ 06 Mktg Yr '2006/ 07 Mktg Yr '2007/ 08 Mktg Yr

U.S. is the only major Supplier with marked increase in Exports in 2007/08 Mktg Year

Limited prospects for other Coarse Grain Exporters

500 mmt lessChina

Corn Exports

400 mmt more Canada

Corn Exports

U.S. Corn Ending Stocks U.S. Corn Ending Stocks CornCorn Ending Stocks as a % of UsageEnding Stocks as a % of Usage

8 711 11

510

20201917119 11

2327

49

23

6266

55

27 25

12

0

12

24

36

48

60

72

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s to

Use

2007/08 Ending Stocks: 1.438 Billion Bu. 11% Stocks/Use

U.S. Corn Stocks/Use% vs U.S. Corn Stocks/Use% vs PricePrice

$3.02

$3.12$3.21

$3.24

$2.42

$2.00

$3.04

$4.00

0

10

20

30

40

50

60

70

'73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07

Marketing Year

% S

tock

s/U

se

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

U.S

. C

orn

$

Stocks/Use% U.S. Corn Price

2007/08 Record High: $3.70 - $4.30 / bu

@ 11% Stocks/Use

Land in CropsLand in Crops (Millions of acres)(Millions of acres)

55 yr. Ave.yr. Ave. 07/08USDA07/08USDA Proj. 08/09Proj. 08/09

CornCorn 79.6 79.6 93.6 93.6 88.0 88.0 (-6%)(-6%) SoybeansSoybeans 74.2 74.2 63.6 63.6 70.0 70.0 (+10%)(+10%)

HayHay 62.4 62.4 61.8 61.8 61.8 61.8 (--)(--)

WheatWheat 59.5 59.5 60.4 60.4 62.2 62.2 (+3%)(+3%)

CottonCotton 14.1 14.1 10.8 10.8 10.0 10.0 (-7%)(-7%)

Grain Sorghum 8.1 Grain Sorghum 8.1 7.7 7.7 7.4 7.4 (-(-4%)4%)

Principle Crops Principle Crops 297.9 297.9 297.9 297.9 299.4299.4CRPCRP 35.9 35.9 34.9 34.9 (-3%)(-3%)

Total crop land in the United States – 441.6 million acresTotal crop land in the United States – 441.6 million acres

Crop Acres Coming Out of Crop Acres Coming Out of CRPCRP

2007–2017 (2007–2017 (Source: USDA, FSA)Source: USDA, FSA)

1.0

0.5

0.9 1.0

1.4 1.3

1.1

0.90.8 0.8

0.4

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.7520

07

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Mil

lio

n A

cres

Long Run Grain Prices Long Run Grain Prices 2000-06 USDA Long RunAverage 2007/08 Projection

Wheat $3.35 $6.45–$6.85 $5.00Corn $2.24 $3.70–$4.30 $3.50Grain Sorghum $2.20 $3.60–$4.20 $3.40Soybeans $5.66 $9.90–$10.90 $7.50Sunflowers $11.57 $19.60–$21.20 $15.501 National marketing year average price per unit, 2000-2006.

Grain Marketing Grain Marketing ConsiderationsConsiderations

WheatWheat – Global shortage of quality milling – Global shortage of quality milling wheat, reduced Australian and Argentinean wheat, reduced Australian and Argentinean production, and acres planted N. Hemisphere.production, and acres planted N. Hemisphere.

Corn/G.S.Corn/G.S. – Strong demand from overseas – Strong demand from overseas buyers, ethanol demand, and bid for acres.buyers, ethanol demand, and bid for acres.

SoybeansSoybeans – Dryness hurting Argentinean and – Dryness hurting Argentinean and Brazilian crops, hectares in Brazil up only 1%, Brazilian crops, hectares in Brazil up only 1%, and critically low carryover in the U.S.and critically low carryover in the U.S.

Factors to WatchFactors to Watch:: Tight global S/D balances for wheat and soybeansTight global S/D balances for wheat and soybeans Battle for acres this springBattle for acres this spring Harvest of Southern Hemisphere cropsHarvest of Southern Hemisphere crops

Questions???Questions???

K-State Extension Agricultural K-State Extension Agricultural Economics:Economics:

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