The farmdoc team at the University of Illinois has created a model projecting the average fall price for corn and soybean futures in October. University of Illinois Agricultural Economist Gary Schnitkey says, at USDA’s current projected yields, it puts December corn futures at $3.10 and November Soybean futures at $8.36.
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This University of Illinois cover crop research is funded in part by Illinois NREC. The Nutrient Research Education Council was created by state statute in 2012 and funded by a 75-cent per ton assessment on bulk fertilizer.
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The market for commodity crops processed into new products is expected to more than double in the next six years to some 490 billion dollars. The IBRL building on the Univesity of Illinois campus in Urbana-Champaign is investing in the future of these agricultural innovations.
The last week of September a new building was dedicated on the University of Illinois campus in Urbana-Champaign. The Integrated Bioprocessing Research Laboratory is designed to bridge the gap between discovery and commercialization. IBRL’s director, Vijay Singh, says every year some 250 invention disclosures are filed at the University of Illinois. Most are never commercialized because there isn’t a proof of concept facility to scale up new ways to process ethanol or other agricultural biofuels.
The labs in IBRL, Singh says, will do just that, “This facility is also a link joining academia with business development. With plug and play utilities and flexible equipment offerings, IBRL is agile enough to serve a variety of needs across the bioprocessing industry.”
However, it’s not just the IBRL building on the University of Illinois ag campus that creates this commercialization synergy. There’s the Food Science pilot plant, the Institute for Genomic Biology, the array of greenhouses, the energy farm where all kinds of crops are explored for biofuels, and Research Park where big data technology is fused with the hard sciences. Together, Vijay Singh believes, these create an unmatched eco-space that can drive a bio-economy in Illinois and beyond.
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The dramatic fall in the price of corn and soybeans earlier in the year has put farmers in a unique marketing position. They must decide how much of the drop is due to the expected bumper crop size of the harvest and how much comes from the Trump Administration trade policies. University of Illinois Agricultural Economist Todd Hubbs says determining when those disputes might be settled is key to making good marketing decisions.
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Farmers, as we enter the last half of May, are nearing the end of the spring planting season and they are turning their attention again to the marketplace. Todd Gleason has more on how one agricultural economist sees prices playing out for the year.
We’ll start with the last numbers USDA publishes in the Supply and Demand tables for each commodity, the season’s average price. For corn, that number - at the midpoint - is $3.80. University of Illinois Agricultural Economist Todd Hubbs is a bit more optimistic. He has it at $4.05. His soybean price, however, is less than USDA’s. The agency has it at $10.00 a bushel. Hubbs puts it at $9.45. The difference in viewpoint says Hubbs lands squarely on soybean exports, “When we look forward to 18/19 the 2.29 billion bushel USDA projection seems a bit high especially when you consider the size of the Brazilian soybean crop and China’s aspiration to increase domestic soybean production while cutting back on imports for the first time in over a decade. It is unclear if China can pull this off, but I’ve got exports at 2.20 billion bushels in 18/19 and that may be generous considering whats going on currently in the market.”
So, Todd Hubbs soybean export figure is 90 million bushels lower than USDA’s for the coming marketing season. It’s lower for the current marketing year, too. All-in-all his soybean supply & demand table puts the new crop ending stocks at 562 million bushels. That’s a far cry from the much more optimistic USDA 415 million bushels projection and the reason his price projection is 55 cents a bushel lower than USDA’s. Again USDA is $10.00, Hubbs is at $9.45. His corn number swings in the opposite direction.
USDA, in the May reports, projected the price of new crop corn at $3.80. Hubbs is at $4.05. The reason why is pretty simple. Hubbs says he uses a lower yield trend line yield, "The main difference between my projections and USDA is the trend yield number. We sit at 171.4 whereas USDA has it a 174 bushels to the acre and the final yield makes a big difference in the consumption pattern and the final price.
Again, USDA is at 174 bushels to the acre and Todd Hubbs is using 171.4. Both numbers are calculated from the same USDA yield data set. USDA uses a smaller subset starting at about the time Bt corn was introduced. Hubbs’ set goes back a couple more decades, and consequently, his yield number is lower. The resulting price difference in the supply & demand tables for new crop corn is $3.80 for USDA and $4.05 for Hubbs.
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Listen to Todd Gleason’s full interview with U of I’s Todd Hubbs
Farmers in the United States have been planting more and more acres to soybeans. There is a simple reason behind this increase. Soybeans have been more profitable than other crops over the last several years. The question now is how many acres will they plant next year. University of Illinois Commodity Markets Specialist Todd Hubbs has been thinking about that one and he decided to determine how many acres are needed if the stocks-to-use ratio was to stay at about 7%.
Hubbs says that number should provide a $9.50 season’s average cash price, “If we assume seven-percent stocks-to-use in 2018/2019 would give us $9.50, which would cover the cost of production in Illinois based on current projections, how many acres of soybeans national under those assumptions would we need given a trend yield? Based on a trend yield of about 46.8 bushels to the acre, and it may be higher than that in 2018, we would need about 88.4 million harvested acres to get $9.50 based on a seven-percent stocks-to-use.”
If you use USDA’s long-term trend line yield for next year, 48.4 bushels to the acre, then the harvested acreage number must drop to about 85.4 million in order to get to the $9.50 season’s average cash price. That’s 86.2 million acres planted to soybeans in the United States next spring.
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download presentation (pdf)
USDA Acreage Report
USDA Grain Stocks
University of Illinois Updated Supply & Demand Tables
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Fred Kolb heads up the small grains breeding program at the University of Illinois. He and his crew were out working on the south farms last week (Wednesday, April 18). They swing specialized tubes to deliver a little corn meal and an aphid that carries Barley Yellow Dwarf disease. The aphid, says Kolb, infects the oats. About a week after the aphids are released, he and his team come back to eradicate them. Fred Kolb is a crop scientist at the University of Illinois.
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That lush green grass forage has three major challenges when it comes to meeting cattle nutrition requirements.
- it can lack enough dry matter
- it is high in protein, but the excess can become a problem without the dry matter
- and it is low in fiber
The beef cattle specialists at the University of Illinois wondered if this combination of problems has taken a hand in some of the lower artificial insemination conception rates they’ve seen in one of the three campus herds. Animal Scientist Dan Shike and Extension Beef Educator Travis Meteer set up an experiment to find out. Low dry matter and excess protein has been well documented by the dairy industry as a detriment to reproductive performance. The two wanted to know if a supplemental dry matter feed stock would make a difference. Shike says it did, “We did a synchronized timed A.I. At the first pregnancy check about 58% of the supplemented cows were pregnant to A.I. and 46% of the non-supplemented cows were pregnant to A.I.”
A twelve percent increase is significant. However, Shike cautions he has just two years worth of data to support the findings. Shike and Meteer did a Facebook live video discussing lush spring grasses and the impact on cattle going to pasture that includes more details on conception rate work. Search Facebook for “University of Illinois Beef Cattle Extension”.
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Troy Cary & Lauran Widman (wihd-man) are working to create twelve-thousand 2017 University of Illinois soybean breeding program plots. Todd Gleason caught up with them on Tuesday morning and put together this look at some of the pre-planting season work.
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Darrel Good, Todd Hubbs, Scott Irwin - University of Illinois ACES
by Todd Hubbs, Agricultural Economist - University of Illinois
The high March 1 stock numbers provide some bearish sentiment for old crop corn and soybean prices in 2017. The larger than expected soybean stock number may have some implications for the size of the 2016 soybean crop, but the final estimate will not be known until September. The large corn stocks number impact the consumption of corn in the feed and residual category directly during the current marketing year and an expectation of reduced feed and residual use is prudent moving forward. Planting intentions confirmed the belief that farmers would switch to soybean production in 2017.
The large Brazilian soybean crop this year combined with stable demand over the next marketing year gives an indication of lower prices for soybeans next marketing year. The lower corn planting intentions provide some support for corn prices despite the large March 1 stock estimate. If consumption maintains its current pace, the 2017–18 marketing year should see stable to higher corn prices.
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by Emerson Nafziger, University of Illinois
see The Bulletin article
Relatively dry weather in recent weeks throughout much of Illinois and an early start to fieldwork might provide the unusual opportunity this year of letting us choose corn and soybean planting dates instead of having to wait until it’s dry enough.
There are reports that some corn and possibly some soybeans were planted as early as February this year. The main motivation for such plantings is often the excitement that comes (or doesn’t) from having the crop survive “against all odds.” While that may be satisfying, it doesn’t offer much profit potential. If the crop survives it hardly ever produces yields as high as those from planting at the normal time, and planting very early affects insurability and can also increase the cost of replant seed.
In the warm, dry March of 2012, we planted one date of our planting date study at Urbana on March 16. The crop emerged uniformly and grew well until frost on April 11–12 killed the tops of the plants to the ground. About 75% of the plants survived and grew back, though, and to our surprise this planting also yielded about 75% as much as the April plantings. Most corn planted in mid-March in 2012 (about 5% of the state’s corn was planted by April 1 that year) had to be replanted.
Most people avoid taking insurance coverage risks by planting before earliest allowable planting dates under the federal crop insurance program. Those dates for corn are April 10, April 5, and April 1 for northern, central, and southern Illinois, and for soybean are April 24, April 20, and April 15 in northern, central, and southern Illinois.
Having the earliest insurable dates for soybean about two weeks later than for corn reflects what until recently we considered to be the greater danger from planting soybeans very early compared to planting corn very early. In fact, with better seed handling and treating today, soybean seed produces acceptable stands with mid-April planting about as often as corn does.
Contrary to what many believe, soybean is no more vulnerable to frost than corn after emergence. The only time we’ve seen soybean seedlings killed by frost is when it gets near freezing at the time the hypocotyl hook is exposed to the cold sky, before the cotyledons are pulled from the soil. This period of vulnerability typically lasts no more than a day or two; after the hypocotyl straightens and the cotyledons open, soybean plants are fairly cold-hardy. While corn plants have been considered safe from frost until the growing point is near the soil surface, we have seen corn plants killed by low temperatures (often below 30 degrees) even if they have only two or three leaves exposed.
The primary cause of stand loss in both crops is having heavy rainfall soon after planting. Stand loss from wet soils before or during germination is greater for corn when soil temperatures are low. For soybean, having warm soil under wet conditions speeds up the germination process and mean that seedlings run out of oxygen before emergence. But chances of having heavy rainfall soon after planting are not higher with early planting, and stand problems due to wet soils are as common with May planting as with April planting.
Between 2007 and 2016, we ran planting date studies for corn at a total of 22 Illinois site-years, and between 2010 and 2016, at a total of 26 site-years for soybean. There were four planting dates in each trial, ranging from early April through late May for corn and mid-April through early June for soybean. Data are expressed as percentage of the yield at the highest-yielding date within each site-year.
As shown in Figure 1, planting date responses expressed as percent of maximum yield within each site-year are surprisingly similar for corn and soybean across recent trials. Both crops showed near-maximum yields when planted in mid-April to early May, and yields dropped to 95, 91, and 86% as planting was delayed to May 10, May 20, and May 30, respectively.
|Figure 1. Planting date responses over 22 corn and 26 soybean site-years in Illinois.|
We also see from the data in Figure 1 that neither crop is likely to yield more when planted in early April than when planted in mid- or late April. If fields for both crops are ready to plant in central Illinois on April 6, there are two reasons to plant corn first: 1) it’s insurable; and 2) corn seed is somewhat better able to emerge at high percentage when planted early than is soybean seed.
On the other hand, we generally expect about 85% of soybean seeds and 95% of corn seed to establish plants, so corn can be a little more vulnerable to less-than-desired stands if conditions turn bad after planting. In neither crop, however, would dropping desired stands by 5 percentage points cost much yield.
Finally, we should take care not to be overly influenced by what happened in 2016, a season when growers reported much higher yields from early- compared to late-planted soybeans. Statewide, over the past 20 years or so, the average date by which we get 50% of the crop planted is about May 1 for corn and May 22 for soybean. It would be good if we could move both of those dates up some, and even better if we could move the two dates closer together. Still, with years like 2012 when planting was very early but lack of rain lowered yields by a lot, there’s little relationship between average statewide planting date and average statewide yield.
Most planting delays are due to wet soils, and so are more or less beyond our control. Mudding in either crop, especially in April, is usually a mistake, given the slow rate at which yields for both crops fall as planting is delayed into May, and given the prevent-plant provisions of crop insurance in effect. We should be diligent at starting to plant when all (not just soil) conditions are right, but there’s little reason to panic when planting isn’t as early as we’d like
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Kim Kidwell, Dean of the College of ACES - University of Illinois
Extension personnel facilitate the translation of many of the fantastic discoveries made at land-grant universities to people around the world. Oftentimes, this is the only way that this valuable information reaches people so they can make good decisions that improve the qualities of their lives. Kim Kidwell, Dean of the University of Illinois College of ACES, believes Extension embodies the essence of the land-grant mission because this is where transformation happens. She discusses, with Todd Gleason, how the future of Extension in the state of Illinois can provide the basis through which the discovery process can continue to help change people’s lives.
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Your high schooler can go to college this summer for a few days. Not only that, but they can go to the University of Illinois. Todd Gleason has more on the Illini Summer Academies.
Illinois 4-H is proud to offer this hi-fidelity college exploratory experience on the University of Illinois campus. Participants attend academy sessions led by university professors and enjoy a variety of engaging activities that provide a taste of just how cool college life can be. Imagine getting to work alongside university professors while you’re still in HIGH SCHOOL! Imagine getting to hang out on a college campus. Imagine spending five days with kids your age from all across Illinois. That’s what happens at Illini Summer Academies, so stop imagining it and just do it! This program offers teens the opportunity to explore the University of Illinois campus and many degree programs and careers.
All academies feature project-based learning where youth are either conducting experiements, making something, or discovering some aspect of the world few people ever get to see. Learm more about each Academies by clicking the boxes below. It wouldn’t be college without lots of time for socializing, meeting new friends, and exploring campus. There are 15 different subjects to explore.
- Aerospace Engineering $440
- Animal Science $345
- Anthropology $245
- Chemistry $240
- Digital Manufacturing & Rapid Prototyping $350
- Electrical & Computer Engineering $445
- Honeybees & Beekeeping $295
- Human Development & Family Studies $255
- Molecular & Cellular Biology $345
- Vet Medicine $335
- Ag Communications NEW $250
- Journalism: Activating Your Voice of Inclusion in the Media NEW $220
- The Science of Family Experiences NEW $255
- Theatre & Fashion for Stage NEW $285
- Theatre & Hip Hop NEW $285
Dates Dates are 4 PM Sunday June 25 through 11 AM Thursday June 29.
Eligibility The conference is open to youth who have completed 8th grade by June 2017 and and will be at least 14 by Sept. 1, 2017.
Location You’ll stay in the newer living quarters on campus, Bousfield Hall, 1214 South First Street, Champaign
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A University of Illinois Animal Sciences alum has been elected president of the Illinois Pork Producers Association.
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by Todd Hubbs, Scott Irwin, and Darrel Good
We recently began a series of articles to evaluate the history of corn and soybean yields and deviations from trend yield in Brazil and Argentina. The objective of the yield analysis is to provide a basis for forming expectations about the likely yields of the 2017 crops. The first six articles focused on the alternative sources of historical yield estimates, the selection of the appropriate series to use in the analysis for both corn and soybeans, the selection of the best-fitting trend model for each commodity and country, trend yield deviations in each country for corn, and trend yield deviations in Brazil for soybeans (farmdoc daily, November 2, 2016; November 9, 2016; November 16, 2016; December 14, 2016; December 15, 2016; and January 12, 2016). Today’s article examines soybean yield trend estimates and trend deviations for the Argentinian soybean crop. Since Argentina is the world’s third largest producer of soybeans and is the largest exporter of soybean meal and oil, yield and production prospects have important price implications.
We begin by providing some perspective on regional soybean production in Argentina. The production map of Argentina from the USDA/FAS gives a visual sense of the concentration. The top three soybean production provinces consist of Buenos Aires, Cordoba, and Santa Fe. Table 1 presents soybean production by country from 1971 through 2016 and gives an indication of overall growth in soybean production in the world, and Argentina in particular. Soybean production in Argentina grew rapidly in the early 2000’s with a significant jump in 2001. Figure 1 presents the soybean acreage for Brazil and Argentina provided by USDA/FAS estimates from 1978–2016. Both nations exhibited large growth in soybean acreage over the sample period with Argentinian acreage leveling off at the end of the period. Current estimates place Argentina soybean acreage at 48.1 million acres this year.
Figure 2 presents the annual soybean yields in Argentina for the period 1978 through 2016. As previously discussed in the farmdoc daily article of November 16, 2016, we chose a linear trend to fit the soybean yield data for Argentina. Note that these yield estimates are provided by the USDA’s Foreign Agricultural Service (FAS) and are based on past trends, expert opinion, industry intelligence, and AgMin, the Argentinian Ministry of Agriculture, estimates. Yields have obviously trended higher over time. The linear trend indicates annual average yield increases 0.37 bushels for Argentina. A linear trend explains about 49 percent of the annual variation in actual yields in Argentina. The historical soybean yields in Argentina show large variation around the trend with an extended period of above trend yields from 1998–2003. The linear trend since 1978 explains a much smaller percentage of yield variation than is the case for the U.S. (81 percent) and Brazil (79 percent).
Historical deviations for Argentine soybean yields for the period 1978 - 2016 are shown in Figure 3. Over the 39-year period, the average soybean yield in Argentina was above trend in 22 years and below trend in 17 years. The largest deviation below trend was 9.79 bushels per acre in 2009. The largest positive deviation from trend was 5.80 bushels per acre in 1998. The average positive deviation was 2.66 bushels while the average negative deviation was –3.44 bushels. The deviation from trend is asymmetric with more years of positive trend deviation and larger magnitudes associated with negative trend deviations. This differs substantially from soybean trend deviations for Brazil. Since 2012, Argentinian soybean yields demonstrate a wide variation around trend with significant yield loss in 2012 and a large positive deviation in 2015. Based on the historical trend deviations, the unconditional probability of a negative deviation is 43.6 percent. If a negative deviation occurs, the unconditional probability of a negative deviation of greater than two bushels is 65 percent, and there is a 29 percent probability of a greater than four-bushel deviation. The probability of a negative yield deviation greater than two (four) bushels, then, is 28 (13) percent. Based on the historical trend deviations, the unconditional probability of a positive deviation of greater than two bushels is 59 percent, and there is a 23 percent probability of a greater than four-bushel deviation. The probability of a positive yield deviation greater than two (four) bushels, then, is 33 (13) percent.
An examination of the national average soybean yields in Argentina for the period 1978 through 2016 reveals an upward yield trend with substantial annual variation. The estimated linear yield trend points to a 2017 average soybean yield of 42.2 bushels per acre, 1.10 bushels below the 2016 average. Based on the projections of harvested acreage in the USDA’s January 12, 2017 World Agricultural Production report, yield at trend value for Argentina points to a 2017 crop of 2.03 billion bushels, 57 million bushels (2.73 percent) smaller than the 2016 crop. Using estimates of the historical yield trend deviations, we estimate there is an unconditional probability of 62 percent of a two bushel trend deviation. A trend yield deviation of two bushels per acre would add or subtract approximately 96 million bushels to our projection of Argentina’s 2017 production.
The USDA projects the 2017 Argentinian yield at 43.57 bushels per acre (1.37 bushels above the trend value) and production at 2.094 billion bushels, 7 million bushels larger than the 2016 crop. The USDA estimated production level for Argentine soybeans is 64 million bushels larger than implied by a trend yield. Recent reports in Argentina indicate severe flooding in many growing regions with the potential to reduce production by 100–150 million bushels. If the production reduction materializes in Argentina, 2017 will produce yields well below trend estimates. In the next article, we will examine the impact of La Nina events on Brazilian and Argentinian soybean and corn production.
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University of Illinois Extension and members of the farmdoc team from the Department of Agricultural and Consumer Economics will be holding a series of five Farm Economics Summit meetings to help producers navigate these difficult times.
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Speakers from the farmdoc team at the University of Illinois will explore the farm profitability outlook and management challenges from several perspectives, including the 2017 outlook for prices, farm financial management in tough times, needed changes in farmland leases, updates on the farm program safety net, agricultural credit conditions, and long-term weather and yield trends. The format for the meeting will be fast-paced and allow plenty of time for questions from the audience.
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The Harrington Seed Destructor is being tested by the University of Illinois for field level efficacy to control herbicide resistant weeds.
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Urbana - University of Illinois Extension Agronomist Emerson Nafziger discusses the potential of the corn and soybean crops at mid-season.
- Corn (tipback)
- Soybean (tall)
- Growing Degree Days (frost)
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Agronomy Day on the University of Illinois campus is Thursday August 18th.
Agronomy Day at ILLINOIS has moved this year. It’ll be a bit further south of campus at the new facilities on the First Street farm says University of Illinois Extension Weed Scientist Aaron Hager.
The south First Street facility is about 3 miles or so from the usual place, however, it is in a different city on the map. The address is Savoy. Just go straight south from the U of I’s football and basketball arena’s on First Street and you’ll find the farm on the east side of the road. The doors open at 7am Thursday August 18th, with a meal at the noon hour.