Iowa Farm Outlook & News
- Sept. 2016 Prices for 2015/16 Crops:
Corn $3.60 per bushel, steady with last month
Soybean $8.95 per bushel, steady with last month
- Sept. 2016 Prices for 2016/17 Crops:
Corn $3.20 per bushel, up 5 cents from last month
Soybean $9.05 per bushel, down 5 cents from last month
- Sept. 2016 Yield Estimates for 2016/17 Crops:
Corn 174.4 bushels per acre, down 0.7 bushels from last month
Soybean 50.6 bushels per acre, up 1.7 bushels from last month
Calf Marketing (9/1/16)
Now is the time to create a marketing strategy for your 2016 calf crop. Cow-calf producers who have an idea about the expected value of their calves can evaluate price offerings and decide among marketing at weaning or retaining ownership. Another issue is deciding whether to just watch and take a cash price at some point or get some price protection in place. With October 2016 feeder cattle futures trading around $138 per cwt, producers can use basis to find an implied calf price or value. In October 2015, the basis on 500 to 600 pound steers in Iowa was $31 per cwt. However, this year the basis has been averaging 52% weaker than in 2015. If this basis pattern holds for October, calves for October marketing would be valued at $153 per cwt. If forward bids are at or better than levels implied by the futures market, then consider forward contracting. If the forward bids are at or lower than levels implied by the futures market, consider hedging with futures or options. If you expect the price to rise and can manage the risk, then waiting may be the best choice for now. If prices rise or hold steady then price risk management will likely cost more than what it is worth. However, if prices decline then there could be several dollars never captured due to the price decline.
Corn Shrinks, But Soybeans Bloom (9/12/16)
The projections for record crops keep on coming, but the corn crop did shrink a little bit with the latest USDA projections. The national corn yield projection was lowered 0.7 bushels to 174.4 bushels per acre. The result would still be a 15 billion bushel corn crop. Corn usage was adjusted slightly, mainly reducing expected harvest losses. And the initial export pace to start the marketing year is a good sign, with corn sales exceeding last year's pace. The national soybean yield projection was raised 1.7 bushels to 50.6 bushels per acre. That puts national production above 4.2 billion bushels. Soybean usage was increased in both the domestic crush and export categories. But projected stock levels for the fall of 2017 continue to climb higher. Today's reports continue the trend of strong demand, but stronger supply.