Latest Post
Tampilkan postingan dengan label corn market 2012. Tampilkan semua postingan
Tampilkan postingan dengan label corn market 2012. Tampilkan semua postingan
18.19
Corn Recapture Demand as Slumping Price Spurred by World Production
Written By mine on Rabu, 06 Juni 2012 | 18.19
Corn recapture demand from the livestock industry after losing out to wheat because of slumping prices spurred by record world production, according to the International Grains Council. Corn for July delivery, the most-active contract, traded at $5.805 a bushel at 12:06 p.m. today, 6.5 percent cheaper than wheat for the same delivery month at $6.21. Macquarie Group Ltd. expects corn to average $5.87 a bushel in 2012, while wheat may average $6.16 a bushel.
Global wheat output may total 671 million tons in 2012-13, down 3.5 percent from a record 695 million a year earlier, the IGC estimates. Dry weather in parts of Europe, former Soviet Union countries and the U.S. spurred the group to revise its forecast down from 676 million a month earlier, Reynolds said.
Chicago corn futures plunged 12 percent last month as both the IGC and the U.S. Department of Agriculture issued forecasts for record world output, while wheat touched an eight-month high May 21 as dry weather threatened crops from Kansas to Russia. Food prices globally at the end of April were 10 percent lower than the record in February 2011. The Standard & Poor’s GSCI Index of 24 commodities dropped 13 percent in May.
July-delivery corn was as much as $1.015 a bushel cheaper than wheat last month on the Chicago Board of Trade, the biggest discount since March 2011, Bloomberg data show. In June 2011, hot, dry weather sent corn to a 40.5-cent premium over wheat, the highest for a most-active contract since 1959. The two grains averaged near parity for the eight months through the end of April, before corn resumed a discount in May and closer to the price relationship it’s had with wheat in the past 10 years.
Cheaper corn costs in the 2012-13 crop year may spur livestock producers worldwide to feed 515.4 million metric tons of the grain, the most on record and 5.3 percent more than a year earlier, according to the IGC, which hosts its annual outlook conference tomorrow in London. The group expects wheat feed use to be 128.8 million tons in the upcoming crop, down 9.2 percent from a record this year. The 2012-13 crop starts July 1.
“There will be a lot more corn in the world in the coming year, so corn may recapture some of the demand wheat has taken,” Amy Reynolds, an IGC senior economist, said by phone from London last week. “We’re assuming a fall in feed wheat use and a relatively large increase in use of corn as feed.”
Farmers worldwide may harvest 913 million tons of corn in the marketing year that begins July 1, 5.4 percent more than a year earlier, the IGC said May 24. The U.S., the world’s biggest corn grower and consumer, may produce a record 355 million tons. The USDA estimates that world output may total 945.8 million tons, and pegs U.S. production at 375.7 million, as yields rebound after hot, dry weather cut the harvest last year.
Ninety-seven percent of the U.S. corn crop had emerged from the soil as of June 3, compared with a previous five-year average of 83 percent for the date, the USDA said June 4. Warm, dry weather allowed farmers to accelerate planting at a faster-than-normal pace this year, helping spur the USDA to project yields of 166 bushels an acre, the highest on record dating to 1866.
“The yields the USDA is assuming are more than doable, but the issue is whether crop conditions will stay as favorable as they have been for the rest of the season,” Reynolds said. “There is a difference of opinion about how good yields may be for this season. We’re taking a more cautious viewpoint than the USDA is doing.”
Global wheat output may total 671 million tons in 2012-13, down 3.5 percent from a record 695 million a year earlier, the IGC estimates. Dry weather in parts of Europe, former Soviet Union countries and the U.S. spurred the group to revise its forecast down from 676 million a month earlier, Reynolds said.
Chicago corn futures plunged 12 percent last month as both the IGC and the U.S. Department of Agriculture issued forecasts for record world output, while wheat touched an eight-month high May 21 as dry weather threatened crops from Kansas to Russia. Food prices globally at the end of April were 10 percent lower than the record in February 2011. The Standard & Poor’s GSCI Index of 24 commodities dropped 13 percent in May.
July-delivery corn was as much as $1.015 a bushel cheaper than wheat last month on the Chicago Board of Trade, the biggest discount since March 2011, Bloomberg data show. In June 2011, hot, dry weather sent corn to a 40.5-cent premium over wheat, the highest for a most-active contract since 1959. The two grains averaged near parity for the eight months through the end of April, before corn resumed a discount in May and closer to the price relationship it’s had with wheat in the past 10 years.
Cheaper corn costs in the 2012-13 crop year may spur livestock producers worldwide to feed 515.4 million metric tons of the grain, the most on record and 5.3 percent more than a year earlier, according to the IGC, which hosts its annual outlook conference tomorrow in London. The group expects wheat feed use to be 128.8 million tons in the upcoming crop, down 9.2 percent from a record this year. The 2012-13 crop starts July 1.
“There will be a lot more corn in the world in the coming year, so corn may recapture some of the demand wheat has taken,” Amy Reynolds, an IGC senior economist, said by phone from London last week. “We’re assuming a fall in feed wheat use and a relatively large increase in use of corn as feed.”
Farmers worldwide may harvest 913 million tons of corn in the marketing year that begins July 1, 5.4 percent more than a year earlier, the IGC said May 24. The U.S., the world’s biggest corn grower and consumer, may produce a record 355 million tons. The USDA estimates that world output may total 945.8 million tons, and pegs U.S. production at 375.7 million, as yields rebound after hot, dry weather cut the harvest last year.
Ninety-seven percent of the U.S. corn crop had emerged from the soil as of June 3, compared with a previous five-year average of 83 percent for the date, the USDA said June 4. Warm, dry weather allowed farmers to accelerate planting at a faster-than-normal pace this year, helping spur the USDA to project yields of 166 bushels an acre, the highest on record dating to 1866.
“The yields the USDA is assuming are more than doable, but the issue is whether crop conditions will stay as favorable as they have been for the rest of the season,” Reynolds said. “There is a difference of opinion about how good yields may be for this season. We’re taking a more cautious viewpoint than the USDA is doing.”
Label:
Corn,
corn cost,
corn demand,
corn future,
corn market 2012,
corn price july
20.02
Corn Prices Surge 2 years, Inventories Fell Lowest in first March 2012
Written By mine on Sabtu, 31 Maret 2012 | 20.02
Corn prices surge from 2010 till this year 2012, while corn inventories in first March 2012 fell lowest since 2004 according USDA. Corn futures prices for May 2012 delivery jump by the exchange limit of 40 cents, or 6.6 percent, to close at $6.44 a bushel at 1:15 p.m. That was the biggest gain for a most-active contract since June 30, 2010. The advance pared the decline for the quarter to 0.4 percent according CBOT.
Corn stockpiles on March 1 fell 7.9 percent to 6.009 billion bushels from a year earlier, the USDA said. Analysts in a Bloomberg survey expected 6.16 billion, on average. The agency’s estimate of consumption in the three months ended Feb. 29 unexpectedly rose 3.1 percent to a record 3.64 billion bushels. That figure includes use in food, livestock feed and fuel, along with exports and waste.
American corn acreage this year will be the largest since 1937, and more than expected, as profit prospects improve and warm, dry weather encourages farmers to boost plantings, the government said. Soybean acres are forecast to fall while wheat seeding may climb. About 95.864 million acres will be planted with corn, up 4.3 percent from 91.921 million last year and more than the 94.658 million expected by analysts, the U.S. Department of Agriculture said today in a report based on a farmer survey. Farm net income may total $91.7 billion this year, the second highest on record, the USDA said last month.
Corn farmers in some parts of the Midwest can make more than twice as much from an acre of corn as from soybeans, according to AgStar Financial in Rochester, Minnesota. In Illinois, the biggest corn-growing state after Iowa, farmers have already started seeding following recent record high temperatures, the USDA said earlier this week.
Corn stockpiles on March 1 fell 7.9 percent to 6.009 billion bushels from a year earlier, the USDA said. Analysts in a Bloomberg survey expected 6.16 billion, on average. The agency’s estimate of consumption in the three months ended Feb. 29 unexpectedly rose 3.1 percent to a record 3.64 billion bushels. That figure includes use in food, livestock feed and fuel, along with exports and waste.
American corn acreage this year will be the largest since 1937, and more than expected, as profit prospects improve and warm, dry weather encourages farmers to boost plantings, the government said. Soybean acres are forecast to fall while wheat seeding may climb. About 95.864 million acres will be planted with corn, up 4.3 percent from 91.921 million last year and more than the 94.658 million expected by analysts, the U.S. Department of Agriculture said today in a report based on a farmer survey. Farm net income may total $91.7 billion this year, the second highest on record, the USDA said last month.
Corn farmers in some parts of the Midwest can make more than twice as much from an acre of corn as from soybeans, according to AgStar Financial in Rochester, Minnesota. In Illinois, the biggest corn-growing state after Iowa, farmers have already started seeding following recent record high temperatures, the USDA said earlier this week.
16.36
Global Corn Outlook 2012
Written By mine on Selasa, 31 Januari 2012 | 16.36
Corn outlook 2012 that corn market might be volatile into early 2012, as it could shift from being in a very tight stocks situation in 2011 to one where a surge in global feed grain and US corn production sparks a sharp increase in available supply.
May 2012 corn experienced a strong bull trend this past summer, rallying from 400 on June 30 to 793 on August 30th. Following that peak, the market set back to 584 1/2 by December 15th, as it priced in a poor global economic outlook and expectations for expanding feed grain production in South America in early 2012 and in the US next summer.
This past summer’s heat was enough to push US yields down to just 146.7 bushels per acre from 152.8 last year and 164.7 two years ago. Fears that the yield was actually lower helped drive the market to a secondary high on November 9th, but news of increasing supply from competitors and expanding world and US wheat supply helped to push the corn market sharply lower into December. If South America’s weather is normal this growing season, the supply/demand fundamentals for the 2012/13 season could look bearish, and the market may see the need to reflect that in the first quarter of 2012.
The January 12th quarterly Grain Stocks and final Crop Production reports for 2011 may give traders a better indication as to whether prices have been high enough this season to ration supply and hold corn ending stocks above the pipeline minimum. If the final 2011 yield is adjusted down to 145 bushels/acre (due to the late harvest in Ohio and the tendency for small crops to get smaller as the USDA makes its revisions during the course of the year) and the USDA finds a need to adjust domestic feeding demand higher from the current estimate, which is a 22-year low, ending stocks could slip below 600 million bushels, and the stocks/usage ratio could fall below 5% to a record low. While this scenario is not likely, the tightness in the cash market in the weeks immediately following the harvest, the historically strong cash basis levels, and the extreme volatility for the previous quarterly stocks reports suggests that extreme tightness cannot be ruled out until after the January 12th reports are released. March corn has made a limit move on the January report date in each of the last five years.
If the January report does not show a continued tightening of ending stocks from the current forecast of 848 million bushels, the lack of a serious weather issue so far in South America plus talk that there will be plenty of available acres in the US to see corn and soybeans expand for 2012 may shift corn from a bull to a bear trend for early 2012. The USDA Farm Service reported 9.6 million acres of prevented plantings due to flooding or other weather problems in 2011, which was up sharply from 6.9 million in 2009 and 4.2 million in 2008. This suggests that with normal spring weather, there will be plenty of incentives for producers to expand both corn and soybean acres in 2012. Also, an additional 1.6 million acres will move out of the Conservation Reserve Program for the coming year, which will add to the total acres available for grain production.
The record returns that corn producers garnered in 2011 will be all the more reason for them to expand acreage in 2012. We estimate that planted area could reach 95.4 million acres, an increase of 3.5 million from 2011 and a new record. If we assume a return to a more normal yield of 164 bushels per acre and a 4% jump in consumption due to lower prices, we still end up with an ending stocks forecast for 2012/13 season of 2.092 billion bushels, up 135% from this season. This would also push the US stocks/usage ratio to an eight-year high of 15.9%, up from 6.7% this season and 8.6% last year. With this setup, the bulls will be counting on abnormal weather for a third year in a row to rationalize a return to the bull trend. If the global economic outlook for growth and/or inflation does not cooperate into the first quarter of 2012, we could a resumption of the downtrend that began in September.
The global scenario is not much different. Producers around the world saw strong profitability in corn production over the past few years, so planted area is likely to expand. Exports surged in Ukraine and Argentina in 2011, and this could encourage their growers to put more resources towards production in 2012.
The market was in a long liquidation selling trend as of late 2011, and this looks to continue into early 2012. Noncommercial traders (funds) were still holding a net long position of 139,688 contracts as of December 13th. This was down from a record-high 458,457 contracts in late 2010. This selling pattern is negative, and fund traders will need a reason to extend their long positions into 2012.
Other factors besides weather that could materially shift the supply/demand balance for the coming year would come from China and Mexico. Mexico experienced its worst drought in 70 years in 2011, and this could spark a jump in the amount of corn they import from the US. This will help to offset the export business that the US ceded to Ukraine and Argentina.
China also announced plans to restock its reserves of many commodities late in 2011, and this effort on top of their typical imports could have a dramatic short term impact on the prices. Traders estimate China sold 49 million tonnes of corn from reserves from 2009 to 2011. This is more than the sum total of all US corn exports for a single year and is almost 40% of the current world corn ending stocks estimate for the 2011/12 marketing year. Back in October China set aside funds to buy (import) 9-10 million tonnes of corn. This is equivalent to 376 million bushels. Keep in mind that US ending stocks for 2011/ 12 were projected at just 848 million bushels. But just when it appeared that China was going become get active in its buying, their final corn production estimates were adjusted sharply higher to a record 191.75 million tonnes, up from 184.5 as the November estimate and up from 177.25 million last year and from 163.9 million two years ago.
May 2012 corn experienced a strong bull trend this past summer, rallying from 400 on June 30 to 793 on August 30th. Following that peak, the market set back to 584 1/2 by December 15th, as it priced in a poor global economic outlook and expectations for expanding feed grain production in South America in early 2012 and in the US next summer.
This past summer’s heat was enough to push US yields down to just 146.7 bushels per acre from 152.8 last year and 164.7 two years ago. Fears that the yield was actually lower helped drive the market to a secondary high on November 9th, but news of increasing supply from competitors and expanding world and US wheat supply helped to push the corn market sharply lower into December. If South America’s weather is normal this growing season, the supply/demand fundamentals for the 2012/13 season could look bearish, and the market may see the need to reflect that in the first quarter of 2012.
The January 12th quarterly Grain Stocks and final Crop Production reports for 2011 may give traders a better indication as to whether prices have been high enough this season to ration supply and hold corn ending stocks above the pipeline minimum. If the final 2011 yield is adjusted down to 145 bushels/acre (due to the late harvest in Ohio and the tendency for small crops to get smaller as the USDA makes its revisions during the course of the year) and the USDA finds a need to adjust domestic feeding demand higher from the current estimate, which is a 22-year low, ending stocks could slip below 600 million bushels, and the stocks/usage ratio could fall below 5% to a record low. While this scenario is not likely, the tightness in the cash market in the weeks immediately following the harvest, the historically strong cash basis levels, and the extreme volatility for the previous quarterly stocks reports suggests that extreme tightness cannot be ruled out until after the January 12th reports are released. March corn has made a limit move on the January report date in each of the last five years.
If the January report does not show a continued tightening of ending stocks from the current forecast of 848 million bushels, the lack of a serious weather issue so far in South America plus talk that there will be plenty of available acres in the US to see corn and soybeans expand for 2012 may shift corn from a bull to a bear trend for early 2012. The USDA Farm Service reported 9.6 million acres of prevented plantings due to flooding or other weather problems in 2011, which was up sharply from 6.9 million in 2009 and 4.2 million in 2008. This suggests that with normal spring weather, there will be plenty of incentives for producers to expand both corn and soybean acres in 2012. Also, an additional 1.6 million acres will move out of the Conservation Reserve Program for the coming year, which will add to the total acres available for grain production.
The record returns that corn producers garnered in 2011 will be all the more reason for them to expand acreage in 2012. We estimate that planted area could reach 95.4 million acres, an increase of 3.5 million from 2011 and a new record. If we assume a return to a more normal yield of 164 bushels per acre and a 4% jump in consumption due to lower prices, we still end up with an ending stocks forecast for 2012/13 season of 2.092 billion bushels, up 135% from this season. This would also push the US stocks/usage ratio to an eight-year high of 15.9%, up from 6.7% this season and 8.6% last year. With this setup, the bulls will be counting on abnormal weather for a third year in a row to rationalize a return to the bull trend. If the global economic outlook for growth and/or inflation does not cooperate into the first quarter of 2012, we could a resumption of the downtrend that began in September.
The global scenario is not much different. Producers around the world saw strong profitability in corn production over the past few years, so planted area is likely to expand. Exports surged in Ukraine and Argentina in 2011, and this could encourage their growers to put more resources towards production in 2012.
The market was in a long liquidation selling trend as of late 2011, and this looks to continue into early 2012. Noncommercial traders (funds) were still holding a net long position of 139,688 contracts as of December 13th. This was down from a record-high 458,457 contracts in late 2010. This selling pattern is negative, and fund traders will need a reason to extend their long positions into 2012.
Other factors besides weather that could materially shift the supply/demand balance for the coming year would come from China and Mexico. Mexico experienced its worst drought in 70 years in 2011, and this could spark a jump in the amount of corn they import from the US. This will help to offset the export business that the US ceded to Ukraine and Argentina.
China also announced plans to restock its reserves of many commodities late in 2011, and this effort on top of their typical imports could have a dramatic short term impact on the prices. Traders estimate China sold 49 million tonnes of corn from reserves from 2009 to 2011. This is more than the sum total of all US corn exports for a single year and is almost 40% of the current world corn ending stocks estimate for the 2011/12 marketing year. Back in October China set aside funds to buy (import) 9-10 million tonnes of corn. This is equivalent to 376 million bushels. Keep in mind that US ending stocks for 2011/ 12 were projected at just 848 million bushels. But just when it appeared that China was going become get active in its buying, their final corn production estimates were adjusted sharply higher to a record 191.75 million tonnes, up from 184.5 as the November estimate and up from 177.25 million last year and from 163.9 million two years ago.
