Iowa Farm Outlook & News

Headlines
  • Jan. 2017 Cattle: Inventory of All Cattle & Calves:
       U.S. 93.585 million head, up 1.8% from last year
       IA 3.850 million head, down 2.5% from last year
  • Jan. 2017 Cattle: Inventory of Beef Cows:
       U.S. 31.210 million head, up 3.5% from last year
       IA 965,000 head, up 2.7% from last year
  • Jan. 2017 Cattle: Cattle on Feed:
       U.S. 13.067 million head, down 0.7% from last year
       IA 1.160 million head, down 5.7% from last year
  • Jan. 2017 Prices for 2016/17 Crops:
       Corn $3.40 per bushel, up 5 cents from last month
       Soybean $9.50 per bushel, up 5 cents from last month
  • Jan. 2017 Yield Estimates for 2016/17 Crops:
       Corn 174.6 bushels per acre, down 0.7 bushels from last month
       Soybean 52.1 bushels per acre, down 0.4 bushels from last month
Livestock
Cattle (2/1/17)

Fed cattle prices are off to a good start in 2017. USDA AMS report LM_CT167 shows Iowa/Minnesota prices rose to $121.66 per cwt during the week ending Sunday, January 22. That was the highest weekly average fed cattle price since the first week of July 2016. It also represents a 27% increase since mid-October, when 2016 prices bottomed at $95.93 per cwt. The return in December for finishing yearling steers, as calculated by Iowa State University, was a $3.86 profit per head. This is a welcome development as sale prices have not covered cost of production in 20 of the last 24 months. For the first six months of 2017, the average projected profit is $92.64 per head. The best month currently projected is April 2017 steer closeouts (profit of $210.84 per head). Unfortunately losses are projected for July through December 2017 closeouts, averaging -$70.98 per head. However, the margin for error given variation across operations in cost of gain is easily a $50 per head movement either way, which makes the situation a potential breakeven or better for some operations.

Crops
The Final Numbers Gave the Markets Some Breathing Room (1/14/17)

The final yield and production estimates were released earlier this week and the estimates provided a little bullish news for the markets. For both corn and soybeans, planted area, yields, and production were adjusted downward. And while the U.S. still produced record crops, the reduction in supplies, coupled with still relatively strong demand, was welcomed by the crop markets. Corn plantings were lowered by 500,000 acres, yields dropped by 0.7 bushels, and production declined by 78 million bushels. While feed and residual use was lowered by 50 million, ethanol usage rose by 25 million and exports held steady. The new midpoint of USDA's price range in $3.40 per bushel, up 5 cents from last month. For soybeans, plantings were reduced by 300,000 acres, yields lowered by 0.4 bushels, and production dropped by 54 million bushels. Soybean demand projections were left unchanged, while the midpoint of price range moved up 5 cents to $9.50 per bushel.

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