2012 Animal Outlook Chris Hurt hurtc @purdue.edu Purdue University August 19, 2011
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Department of Agricultural Economics Purdue University 2012 Animal Outlook Chris Hurt [email protected] Purdue University August 19, 2011
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2012 Animal Outlook Chris Hurt hurtc @purdue.edu Purdue University August 19, 2011. If your still standing. Congratulations. Grain and Feed . Two Big Demand Shocks. - PowerPoint PPT Presentation
Transcript of 2012 Animal Outlook Chris Hurt hurtc @purdue.edu Purdue University August 19, 2011
Department of Agricultural EconomicsPurdue University
2012 Animal Outlook
Chris Hurt [email protected] Purdue University August 19, 2011
Department of Agricultural EconomicsPurdue University
Congratulations
IF YOUR STILL STANDING
Department of Agricultural EconomicsPurdue University
Department of Agricultural EconomicsPurdue University
GRAIN AND FEED
Ethanol - From the 2005 crop, 7.8 million corn acres were needed to meet the ethanol needs (by-product adjusted). That climbed to 23.7 million U.S. corn acres in 2010, an increase of 15.9 million acres.
U.S. soybean exports to China required the production from 8.3 million acres of the 2005 crop, but 22.8 million acres of the 2010 crop—an additional 14.5 million acres.
Two Big Demand Shocks
Department of Agricultural EconomicsPurdue University
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0 1 2 3 4 5 6 7 8 9 10
11
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000Corn Use: USDA
FSI-NonFuelFeedExportsFuel
Mill
ion
bu.
Change in World Area of Major Crops
70% from New Land30% from shifting
Department of Agricultural EconomicsPurdue University
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
1,800,000
1,900,000
2,000,000
2,100,000
2,200,000
2,300,000World Total Grains Production and Use
Production
Use
Department of Agricultural EconomicsPurdue University
700,000
750,000
800,000
850,000
900,000868,809
896,055
f(x) = 51860.2261684277 ln(x) + 667975.103480246R² = 0.870728295736081
World Harvested Hectares Total: (Millions)
+ 27 million hectares, or about 3% more land: China, Africa, FSU, Ar-gentina, India, and Brazil
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GRAIN AND FEED
WILL SLOW
Department of Agricultural EconomicsPurdue University
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20181,000.0
1,500.0
2,000.0
2,500.0
3,000.0
3,500.0
4,000.0
4,500.0
5,000.0
5,500.0 Corn to Meet RFS2500 Mil-lion Bu.
Per Year: 2005-10
155 Million Bu. Per Year: 2011-14
Trend Yields
0 Million Bu. Per Year: 2015-2022
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2000
01 02 03 04 05 06 07 08 09 100
100
200
300
400
500
600
700
800
900
1,000
192 164
283 305
436357
423
504
685
825
992
192 164
283 305
436
357423
504 509
615
921
U.S. Soybeans Destined for China: Million Bushels
All PurchasesStocks Adjusted
U.S. Harvest Year
Mill
ion
Bus
hels
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LIVESTOCK INDUSTRY ADJUSTMENTS TO
GRAIN SHOCKS
Department of Agricultural EconomicsPurdue University
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222.3f(x) = 0.938085129664077 x + 185.643655761024R² = 0.8569559949652
Per Capita Total Meats and PoultryRetail Weight: USDA
Pou
nds
per c
apita
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185
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208.5
202.3
f(x) = 0.71765780730897 x + 188.757574750831R² = 0.692536306758222
Per Capita Total Meats and PoultryRetail Weight: USDA
Pou
nds
per c
apita
Why is downsizing of the livestock sector not required today as it was in 2008?
Department of Agricultural EconomicsPurdue University
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20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
70%
75%
80%Portion of Indiana Receipts from Crops and Animals
Crops
Animals
USDA & Purdue
Department of Agricultural EconomicsPurdue University
5 6 7 8 9 10 11 12$38
$43
$48
$53
$58
$63
$68
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53
$50$47 $47 $48
$41
$55
$64 $65
Barrow & Gilt prices and Per Capita Supplies
Price Per Capita Supply
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1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 46 7 8 9 10 2011 2012
$30
$35
$40
$45
$50
$55
$60
$65
$70
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4852 53
50
39 40
53
57
42 43
39
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60 60
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68 69
6265
6865
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Estimated Hog Prices and Costs Per Live Hundredweight:
Hog PriceCosts
$/cw
t
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1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 48 9 10 2011 2012
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.007.70
6.146.81
7.516.92
5.38
Estimated Hog Producer Breakeven Corn Price/Bushel Quarterly
$/bu
shel
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00 1 2 3 4 5 6 7 8 9 10 11 120
4000
8000
12000
16000
20000
24000
U.S. Pork Production and Domestic Available (Billion pounds)
ProductionDomestic UseNet TradeBi
llion
Pou
nds
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5
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15
20
25
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Beef
Pork
Broilers
Turkey
Eggs
Corn
Per
cent
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77 80 83 86 89 92 95 98 1 4 7 1030,000
32,000
34,000
36,000
38,000
40,000
42,000July Beef Cows
Mill
ion
Head
Department of Agricultural EconomicsPurdue University
Department of Agricultural EconomicsPurdue University
90919293949596979899 0 1 2 3 4 5 6 7 8 9 10114000.0
4500.0
5000.0
5500.0
6000.0Beef Replacement Heifers: July 1
Mill
ion
Hea
d
Department of Agricultural EconomicsPurdue University
5 6 7 8 9 10 11$78
$83
$88
$93
$98
$103
$108
$113
$118
40
45
50
55
60
65
70
$87$85
$92 $92
$83
$95
$113$116
Choice Steer per Capita Supplies and Prices
PricePer Capita Supply
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5 6 7 8 9 10 11 12$60
$65
$70
$75
$80
$85
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75
80
85
90
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100
$70.80
$64.40
$76.40
$79.70$77.60
$82.90 $82.50
$85.50
Broiler Per Capita Supplies and Prices
Price Per Capita
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5 6 7 8 9 10 11 12$60
$65
$70
$75
$80
$85
$90
$95
$100
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12
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$73.40$77.00
$82.10
$87.50
$76.50
$90.40
$100.50$97.00
Turkey Prices and Per Capita Supplies
Price
Per Capita
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Will High feed prices Persist??
1900
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1915
1920
1925
1930
1935
1940
1945
1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
$0
$200
$400
$600
$800
$1,000
$1,200 Real U.S. Corn Revenue Per Harvested Acre: 2010 = 100
Dol
lars
Per
Acr
e
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Agricultural policies for surplus vs. shortage?
Surplus• Most of U.S. History• Reduce Supply
– Set-asides– Soil Bank– CRP-Conservation
• Increase Demand– Food Stamps– School Lunch– Export Enhancement– Ethanol mandate/tax
credits
Shortage• Limited History• Increase Supply
– Release/reduce CRP– Flexible haying/grazing
CRP– Research & education– Production incentives
• Reduce Demand– Limit export incentives– No mandates or tax credits– Establish priorities
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Questions?
