Outlook: Grains and Oilseeds - USDA...8% 10% 12% 14% 16% 18% 20% 2009/2010 2015/2016 2021/2022F...
Transcript of Outlook: Grains and Oilseeds - USDA...8% 10% 12% 14% 16% 18% 20% 2009/2010 2015/2016 2021/2022F...
Office of the Chief EconomistWorld Agricultural Outlook Board
2021 AOF
Outlook:Grains and Oilseeds
Justin ChoeWorld Agricultural Outlook Board, OCE, USDA
Office of the Chief EconomistWorld Agricultural Outlook Board
2021 AOF
Outline
• Introduction• Factors Shaping Forecast• Outlook
• Soybean• Corn• Wheat
• Closing remarks/Summary
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2021 AOF
Introduction
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Timeline for 2021/22 Forecasts
U.S. Agricultural Projections
(early release)
2020/21 Production Estimates for Corn + Soybeans, 2021/22
Winter Wheat Seedings
Agricultural Outlook Forum,
U.S. Agricultural Projections
Prospective Plantings
Initial forecast for 2021/22, Crop
Production Forecast (Winter Wheat)
Acreage report NASS Crop Production Survey (AYS) for Corn,
Soybeans, & Cotton
Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21
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FactorsShapingForecast
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Assumptions: Weather & Policy
• Trend yields used, assuming normal planting progress and growing conditions
• Current policies projected to be “in-place” unless change publicly announced
• No changes to overarching assumptions and approach
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Macroeconomic and Economy-wide Assumptions
• Substantial rebound in U.S. and global economic growth
• COVID-19 is more under control, “normal” business activity resumes
• Despite recovery, global real GDP levels are forecast below pre-COVID levels
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World United States EMDEs excluding China China
Source: The World Bank, Global Economic Prospects (Jan 2021)
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2021 AOF
World production of corn, soy, and wheat continues to grow
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Feed use* of grains and oilseeds rising, as well as U.S. exports
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Corn & Wheat Feed & Residual + Soybean Crush, Foreign Corn & Wheat Feed & Residual + Soybean Crush, U.S.US Exports of Corn, Soybeans, and Wheat
Source: PSD Database, USDA/FAS
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China’s grain imports bodes well for U.S. grain exports
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China CY imports of feed grains/feedstuffs**Size of bubble represents total tonnage
China MY import estimates of key grains*Size of bubble represents total tonnage
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Sorghum Portion of Key Grain Imports* Includes corn, barley, sorghum, wheat, and soybeans. Source: PSD/FAS ** Includes corn, barley, sorghum, DDGS, and field peas. Source: TDM
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Foreign stocks of corn and soy are tightening
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Foreign (sans China) Ending Stocks, SoybeansStocks to Use Ratio Source: PSD Database, USDA/FAS
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U.S. Corn and Soy markets tightening
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U.S. Corn Stocks U.S. Soybean Stocks Corn Stocks to Use Ratio Soybean Stocks to Use RatioSource: PSD Database, AOF
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U.S. Wheat market tightening as well
Source: PSD Database, AOF
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Ending Stocks, U.S. Wheat Stocks to Use Ratio
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Higher prices make planting decisions interesting
Source: CME
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Profitable for foreign competition as well
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Futures Soy-Corn Price ratios suggest strong rebound in soy acreage
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Soy-Corn Price Ratio in the futures market
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Interior Cash Price ratios are falling
Source: CME
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Where will 3-crop Prevent Planting land?
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Wheat, Corn, and Soybean Planted Acreage for 2021/22
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Outlook: Corn
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Outlook:Soybeans
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Intentions vs. Planted Area: Soybeans
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China import demand ramping up
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United States Brazil Argentina OtherSource: TDM
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U.S. is price competitive, but is there enough?
Source: IGC
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U.S. Soybean Balance Sheet for 2021/22
In thousands Domestic units
2020/21 (Feb) 2021/22 Diff.
Area planted (mil. acres) 83.1 90 +6.9Yield (bu/acre) 50.2 50.8 +0.6Production (mil. Bu) 4,135 4,525 +390Imports 35 35 -Exports 2,250 2,200 -50Crush 2,200 2,210 +10Seed and Residual 125 124 -1Ending Stocks 120 145 +25Farm Average Price ($/bu) $11.15 $11.25 +$0.10
• Soybean acreage boosted up 6.9 mil. acres to 90 mil
• Production up 390, but with tight stocks supply is down
• Domestic use is up slightly, with lower exports
• Stocks are up slightly from historically low S/U
• Prices up slightly
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Outlook: Corn
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Outlook:Corn
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Intentions vs. Planted Area: Corn
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Corn prices supported by strong foreign demand
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Central IL CashGuangzhouBrazil (Composite Price)
Source: CME, CNGOIC
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U.S. is price competitive with ample supplies
Source: IGC
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Will driving return to pre-COVID-19 levels?
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Motor Gasoline Product Supplied, Monthly, billion gallons (EIA STEO) Corn used for ethanol production, billion bushels (NASS)
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U.S. Corn Balance Sheet for 2021/22
In thousands Domestic Units2020/21 (Feb) 2021/22 Diff.
Area planted (mil. acres) 90.8 92 +1.2Yield (bu/acre) 172.0 179.5 +7.5Production (mil. bu) 14,182 15,150 +968MY Imports 25 25 -MY Exports 2,600 2,650 +50Feed & Residual 5,650 5,850 +200Food, Seed, Industrial 6,375 6,625 +250
Ending Stocks 1,502 1,552 +50Average Farm Price $4.30 $4.20 -0.10
• Acres up to 92 million, increasing production by 7%
• Domestic usage up on rebound in FSI use and feed
• Exports up on strong prospects to China
• Stocks up slightly• Prices are lower on returning
global competition
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Strong demand from China driving up sorghum prices
Source: IGC
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U.S. Sorghum Balance Sheet for 2021/22
• Acreage up on strong profitability
• Projected exports to China to limit domestic use
• Despite larger production, stocks slightly lower
• Prices slightly lower
Domestic Units2020/21 (Feb) 2021/22 Diff.
Area planted (mil. acres) 5.9 7.2 +1.3Yield (bu/acre) 73.2 69 -4.2Production (mil. bu) 373 441 +68MY Imports 0 0 0MY Exports 295 365 +70Feed & Residual 70 70 -Food, Seed, Industrial 10 10 -Ending Stocks 28 24 -4Average Farm Price $4.80 $4.70 -$0.10
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Outlook: Corn
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Outlook:Wheat
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Source: NASS
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Intentions vs. Planted Area: Wheat
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U.S. Wheat Balance Sheet for 2021/22
• Wheat acreage up slightly, but production is virtually flat
• Exports down, but Feed/residual down up
• Ending stocks lower on tighter carry-in
• S/U ratio falls marginally
Domestic Units
2020/21 (Feb) 2021/22 Diff.Area planted (mil. acres) 44.3 45.0 +0.7
Yield (bu/acre) 49.7 49.1 -0.6
Production (mil. bu) 1,826 1,827 +1
MY Imports 120 130 +10
MY Exports 985 925 -60
Feed & Residual 125 140 +15
Food & Seed 1,028 1,030 +2
Ending Stocks 836 698 -138
Average Farm Price $5.00 $5.50 +$0.50
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ConcludingRemarks
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For U.S. Wheat, Soybeans, and Corn in 2021/22…
• Total acreage projected to reach 227 million acres, highest since 2016 • Soybeans + corn acreage to reach record 182 million acres, eclipsing 2017• Wheat acreage rebounds slightly to 45 million acres
• Disappearance of wheat, soybeans, and corn to increase slightly• Domestic cons. rebounds on increased feed and industrial use
• Feed (corn/wheat) and crush (soybeans) up• Motor gas/ethanol and bio/renewable diesel support higher use
• Exports are flat y/o/y, continuing banner year despite increased competition• Combined stocks are lower slightly, driven by wheat and offset by corn & soy• Soy and wheat prices are projected higher, while corn is slightly lower
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