Iowa Farm Outlook & News

Headlines
  • September 2014 Inventory of All Hogs and Pigs:
       U.S.: 65.361 million head, down 2.3% from last year
       Iowa: 20.700 million head, down 1.0% from last year
  • September 2014 Breeding Herd Inventory:
       U.S.: 5.920 million head, up 1.8% from last year
       Iowa: 1.030 million head, up 3.0% from last year
  • September 2014 Market Hog Inventory:
       U.S.: 59.441 million head, down 2.7% from last year
       Iowa: 19.670 million head, down 1.2% from last year
       Iowa Less Than 1,000 Head Feedlots: 530,000 head, down 11.7% from last year
  • October 2014 Yield Estimates for 2014/15 Crops:
       Corn 174.2 bushels per acre, up 2.5 bushels from last month
       Soybean 47.1 bushels per acre, up 0.5 bushels from last month
  • October 2014 Price Estimates for 2014/15 Crops:
       Corn $3.40 per bushel, down 10 cents from last month
       Soybean $10.00 per bushel, steady with last month
Crops
Acreage Reduced, But Yields Offset (10/10/14)

Over the past couple of months, there had been significant discussion of crop acreage numbers and whether the USDA estimates would be adjusted downward. That adjustment occurred in the most recent reports. For corn, planted and harvested area were reduced by 700,000 acres. A similar downward adjustment took place for soybeans. But in both cases, the acreage losses were offset by higher yields so that total production continued to climb. The national average corn yield was raised 2.5 bushels to 174.2 bushels per acre. The corn yield estimates were raised in 22 states. And 22 states are projected to set state records as well. Illinois is projected at 200 bushels per acre. The jump in soybean yields isn't quite as dramatic, but the end result is the same, larger production. The national average is projected at 47.1 bushels per acre, up 0.5 bushels. 13 states are expected to have record yields.

Putting it all together, USDA estimates a 14.475 billion bushel corn crop and a 3.927 billion bushel soybean crop. Both, by far, the largest crops the country has ever produced. In comparison, the demand projections were little changed. Corn feed and residual use was increased by 50 million bushels. That was the only shift in projected demand for the 2014 crops. Estimates for the 2014/15 market year average prices dropped 10 cents for corn to a midpoint of $3.40 per bushel. For soybeans, the price estimates held steady, with a midpoint of $10 per bushel.

Livestock
Hogs and Pigs (10/1/14)

The combination of tighter supplies and robust pork demand has initiated a period of unprecedented profitability for the swine industry. The ultimate question becomes, given the uncertainty experienced the last several years (e.g., weather, price volatility, impacts of PEDv, etc.), what level of return will be required to encourage producers to begin rebuilding the swine breeding herd? In other words, what level of annual return would motivate producers to assume risk in retaining more gilts and investing in farrowing additional sows? Iowa State University estimates costs and returns for swine production based on typical production and marketing practices. The estimated numbers are designed to serve as a barometer of costs and returns and are not intended to represent any one operation. Projected farrow to finish returns for 2014 exceed $65/head and returns for 2015 exceed $42/head when previously returns over $30/head characterized very favorable returns. USDA's September Hogs and Pigs report confirmed what the industry had been suspecting for the past quarter - lingering impacts of PEDv and growing prospects of expansion within the industry.

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