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Weekly outlook

Crop markets

[JAN. 23, 2003]  URBANA -- Corn and soybeans are likely to trade in a relatively narrow range, perhaps into March, said a University of Illinois Extension marketing specialist.

"Producers may need to maintain some patience in pricing additional quantities of 2002 crops and 2003 crops until the market has had a chance to react to spring acreage and weather prospects," said Darrel Good.

Good's comments came as he reviewed the outlook for the markets in the wake of Jan. 10 USDA reports. Attention will now focus on prospects for the upcoming Northern Hemisphere crop season.

"Most of the focus will be on the United States," he said. "Stocks of U.S. crops are expected to be adequate, but small, going into the 2003 harvest seasons. The relatively small inventories mean that the size of the 2003 crops will have very important price implications."

Good noted that two topics will likely dominate market conversation this winter -- soil moisture conditions and planted acreage prospects.


Weather conditions

"Moisture conditions have the most immediate implications for the winter wheat crop," he said. "However, lack of precipitation in large parts of the United States this past fall and so far this winter has triggered early weather talk for spring-planted crops as well. The Palmer Drought Index shows that dry conditions are prevalent in much of the Rocky Mountain States, the upper Plains, Nebraska, and in parts of Kansas, Iowa, Missouri, northern Illinois, northern Indiana and Michigan. Dryness is also noted in parts of the Southeast.

"The National Weather Service outlook for the period February through April projects drier-than-normal climate across the Ohio Valley, Great Lakes region and the Pacific Northwest. For the Southeast, the projection is for a dry February and wetter-than-normal climate in March and April."

Good said that the 90-day forecast is based, in part, on prospects for a weakening El Nino episode. With the lack of other significant fundamental developments, weather conditions may provide a lot of fuel for conversation over the next two months. For corn and soybeans, current moisture conditions obviously have little significance. Spring and summer weather will be an important price factor, as it always is.

Acreage projections

The USDA's winter wheat seedings report revealed a 2.5-million-acre increase in winter wheat seedings in the fall of 2002. The increase totaled 700,000 acres in Kansas, 500,000 in Oklahoma, 300,000 in Montana and 200,000 in Texas. The increase in the eastern Corn Belt totaled 550,000 acres. Seedings declined about 280,000 acres in the South and Southeast.


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"Part of the increase in winter wheat seedings may be offset by declines in spring wheat acreage, depending on relative prices over the next few months," said Good. "One popular private forecaster has projected a 700,000-acre decrease in the total of spring and durum acreage in 2003.

"That same firm has projected that U.S. corn acreage will increase by nearly 2.7 million acres and that soybean area will decline by 1.1 million acres. That firm believes that total acreage of corn, soybeans and wheat will increase by 3.35 million acres in 2003. It is not clear how that increase will occur."

Good noted that a number of factors will influence the magnitude of total crop land acreage and the mix of that acreage by crop in 2003. These include the extent of weather damage to winter wheat, relative prices of spring-planted crops and spring weather conditions. The USDA will release the results of its "Prospective Plantings" survey on March 31.

Price levels

"Corn and soybean prices appear to have established support levels following the price declines immediately after the Jan. 10 USDA reports," said Good. "July corn futures have found support near $2.35. It is probably important for the rate of corn export sales to increase if that support level is to hold. The early January high just above $2.50 may be difficult to penetrate prior to spring. More volatility is likely from March forward, as spring-summer weather conditions unfold."

Good said the soybean market remains inverted, with March futures finding support near $5.44 and July futures finding support near $5.35.

"A high rate of export sales continues to provide fundamental support for soybean prices, but the absence of significant problems in South America tends to keep a lid on prices," said Good. "March and July futures traded to $5.85 and $5.74, respectively, in early January.

"It may be difficult to challenge those levels if South American conditions remain favorable. There is some conversation about potential disease problems in the wetter areas of Brazil."

[U of I news release]

Weekly outlook

Prices drop

[JAN. 21, 2003]  URBANA -- Corn and soybean prices can be expected to test the bottom of the trading range of the past two months, said a University of Illinois Extension marketing specialist.

"Until more is known about the 2003 crops, a significant rally in prices is not expected," said Darrel Good, reacting to USDA reports that apparently triggered a sharp drop in prices of major crops on Jan. 10.

"Prices moved generally higher in front of the reports, apparently expecting some supportive news in the reports," he said. "Instead, the reports generally showed a combination of larger supply estimates, smaller projections of consumption and larger projections of year-ending stocks."


For corn, the estimate of the 2002 U.S. crop came in at 9.008 billion bushels, essentially unchanged from the November projection. Planted acreage of corn in 2002, at 79.054 million, was 793,000 larger than projected in November. Acreage harvested for grain, however, was 1.228 million less than previously projected, as abandoned acreage was larger than normal. The U.S. average yield was estimated at 130 bushels per acre, 2.4 bushels above the November projection.

"At 7.633 billion bushels, stocks of corn on Dec. 1, 2002, were 632 million less than on the same date last year and the smallest in five years," said Good. "However, the implied level of feed and residual use of corn during the first quarter of the marketing year was 130 million bushels, or 5.9 percent, less than during the same quarter last year.

"As a result, the USDA lowered the projection of feed and residual use for the current marketing year by 75 million bushels, to a total of 5.6 billion. That projection is 4.7 percent less than feed and residual use of a year ago and implies that use will be down only 3.9 percent during the last three quarters of the year."

The projection of domestic processing use of corn was increased by 45 million bushels, to a total of 2.245 billion. The expected 9.3 percent increase over last year's use reflects increased ethanol production. U.S. corn exports during the current marketing year are now projected at only 1.85 billion bushels, 50 million less than projected last month and 39 million less than exported last year.

Year-ending stocks are projected at 924 million bushels, 81 million above last month's projection. The projection of world inventories of all coarse grains was also increased, reflecting smaller consumption projections for Japan, Mexico, South Korea and China. The season's average price is projected in a range of $2.15 to $2.55, 5 cents below last month's projection.


For soybeans, the final estimate of the 2002 U.S. crop, at 2.73 billion bushels, was 40 million larger than the November projection. Planted acreage was 765,000 larger than previously estimated, and harvested acreage was 361,000 larger. In addition, the January yield estimate of 37.8 bushels per acre was 0.3 bushels above the November projection.


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"The larger U.S. crop estimate was matched with a 37-million-bushel increase in the projected size of the Argentine crop," said Good. "At 3.167 billion bushels, the 2003 South American crop is expected to be 12.5 percent larger than the 2002 crop, reflecting a 9.5 percent increase in acreage. Stocks of soybeans in the U.S. on Dec. 1, 2002, were estimated at 2.115 billion bushels, 161 million less than on the same date last year."

The projection of the U.S. soybean crush for the current year was reduced by five million bushels, but the projection of exports was increased by 30 million bushels. The net effect of the changes in production estimates and consumption projections was a 15-million-bushel increase in the projected level of year-ending stocks in the United States. The midpoint of the USDA's projection of marketing year average price remained at $5.45.


Stocks of wheat in the United States on Dec. 1, 2002, totaled 1.321 billion bushels, 302 million less than on the same date last year.

"Even so, stocks were larger than expected, forcing the USDA to lower the projection of feed and residual use of wheat for the current marketing year by 50 million bushels," said Good. "The projection of marketing year exports was reduced by 25 million bushels, and the projection of year-ending stocks was increased by 70 million bushels. The projection of the marketing year average farm price is now in a range of $3.50 to $3.80, 15 cents less than projected last month.

"The one positive piece of information in the USDA reports was the estimate of U.S. winter wheat seedings. At 44.246 million acres, the estimate is 2.511 million, or 6 percent, larger than seedings of a year ago but less than anticipated by the market."


With the major USDA reports now reflected in the market, price direction will now be determined by the rate of consumption and prospects for 2003 crops. Reports from South America generally reflect favorable growing conditions for both corn and soybeans, although some concern about potential soybean disease has been noted. The projected size of the Brazilian corn crop was increased by nearly 40 million bushels, and many private analysts believe the Argentine crop could be larger than currently projected.

"In the United States, dry conditions are still impacting the winter wheat crop in some areas, but the main focus will be on the intended acreage of spring-planted crops," said Good. "The first look at acreage will be available with the USDA's Prospective Plantings report released on March 31. The market currently expects an increase in corn acreage and a decrease in soybean acreage."

[U of I news release]

Farm broadcaster Max Armstrong featured at conference

[JAN. 18, 2003]  Max Armstrong, nationally known farm broadcaster, will highlight the 15th commemorative year of the Adopt a Farm Family organization at their 13th annual Rural Restoration Conference. Armstrong is co-host of "WGN U.S. Farm Report" and hosts a daily syndicated radio program, "Farming America."

The conference will be at the Ramada Inn in Sikeston, Mo., during Presidents Day weekend, Feb. 14-17. "The Foundations" will be the theme for the networking, education and spiritual renewal at the gathering.

William J. Federer, nationally known speaker, historian and author of "America's God and Country Encyclopedia of Quotations," will also be featured as a keynote speaker. He will also be joining Richard Wheeler of WJLY radio in Ramsey in honoring former and present board members. Federer and Wheeler are both known for their research on the Founding Fathers.

Robert McGee is the Friday evening keynote speaker. Today's farmers face tremendous stress, and McGee is founder of the Christ-centered Rapha counseling and mental health centers, which can help people cope with stressful situations. He is also the author of the book series "The Search for Significance," "The Search for Peace," "The Search for Freedom" and "The Search for Joy."

Joshua Atieno of Kenya, Africa, who directs the Rural Restoration mission project, will be attending with foreign missionaries Court and Sandy Wood of Virginia, who have been active members of Adopt a Farm Family since the organization's founding. 


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In a breakout session Saturday afternoon, rural development specialists will present information on starting value-added, farmer-owned crops with the assistance of U.S. Department of Agriculture grant funds. Value-added crop programs can be adapted to your area.

Farm panels, a workshop for wounded marriages, special music and other sessions will provide variety for all who attend. Children will be kept busy at sessions especially designed for them.

Adopt a Farm Family was founded in Waynesboro, Ga., in 1988 by Mary Myers, and her husband, Peter, who was at that time USDA deputy secretary of agriculture in Washington, D.C.

For conference information, call Carol at (573) 472-4673 or toll-free at 1 (800) 472-4674. Information is also available at www.farmersruralrestoration.com.

[News release]

ACES open house offers
something for everyone

[JAN. 14, 2003]  URBANA -- Kids in nursery school through 99 years of age will enjoy the 2003 open house at the University of Illinois College of Agricultural, Consumer and Environmental Sciences. The annual event provides a diverse range of presentations for all levels of interests, including displays and activities related to the fields of agriculture and horticulture. People considering a professional role, such as veterinarian, in one of these areas will be as welcome as a master gardener looking to plan next year’s garden. Youth groups and school field trips will find plenty to entertain and educate with subjects like 'The Animal Sciences Classroom" and "Maggot Races."  The fun will begin on Friday and continue on Saturday, March 14 and 15, from 9 a.m. to 4 p.m. on the U of I campus at Urbana-Champaign.

This year's will be the 14th open house at which hundreds of exhibits and activities are open to the public. "Every year we have new exhibits to share with visitors," said Scottie Miller, director of special events for the College of ACES. "But we know that the 'regulars' who come to the open house year after year would be disappointed if some of the old favorites weren't there, too." Miller said that teachers from all over the state, from nursery school to high school, include a field trip to the open house as a regular part of their curriculum.

The theme for this year's open house is "Where do we grow from here?" which fits beautifully with the many plants, insects, animals and other programs studied in the College of ACES. But it also fits with the College of ACES' Department of Human and Community Development -- a department that conducts research and outreach programs to benefit growing families and communities.

One interactive computer exhibit which will be on display in the atrium of the octagonal-shaped ACES library will feature a new website for parents. The website, called "P2P" or "Parent to Parent," incorporates video clips of real parents talking about the joys and challenges they face as parents.


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Sheep shearing and other demonstrations are scheduled to take place throughout the two-day event.

Visitors can pick up a free brochure at any of the buildings that are part of the open house. The brochure will include maps, a complete listing of exhibits, the schedule of demonstrations, and information on parking and concessions.

On Friday, March 14, visitors can park for free in lot F-23 at the corner of First Street and St. Mary's Road, then take a free shuttle from the lot to the open house. On Saturday, visitors can park for free on the street and in campus lots. The shuttle will run continuously both days to help visitors move easily from the Stock Pavilion, the Meat Sciences Building, Plant Sciences and finally to the College of Engineering open house on the north end of campus.

For a listing of the exhibits from last year’s open house, visit http://www.aces.uiuc.edu/openhouse. Details about the 2003 exhibits will be added to the same Web address soon. For more information, call (217) 333-9355.

[U of I College of ACES news release]

What is Logan County agriculture?

[JAN. 13, 2003]  The face of agriculture has changed greatly in the last 10 years, and the rate of change is accelerating greatly. Now the Lincoln/Logan Chamber of Commerce is having a mapping exercise to plan for agricultural development in the area, and looking at the historical facts is the first step.

Farm size has increased from 396 acres in 1987 to 515 acres in 1997. The new census of agriculture being conducted right now will probably show acceleration in this trend and many others. The number of farms has had a corresponding decrease from 949 in 1987 to 739 in 1997. Cropland has increased from 78 percent of land in farms in '87 to almost 92 percent in '97. 

The value of land and buildings has increased from an average of $638,191 to $1,371,841 over the same period. Even corrected for inflation, the value has increased about $330,000 for each farm.

The biggest changes have come in the livestock area. There are almost 40 percent fewer farms selling cattle and calves, and over 50 percent fewer farms are selling hogs and pigs over this 10-year period. We are down to 76 farms in the county (as of 1997) selling hogs, but these farms have increased swine sales almost 150 percent, selling over 190,000 in 1997.

Probably the most telling numbers are the per capita income figures for the county (all residents and not just agriculture). The per capita income, when adjusted for inflation, has increased less than $1,000 over the 20-year period from 1980 to 1999. This is an 11.2 percent increase over the 20 years. 

The mapping exercise has an end goal of planning to increase economic development in the area, so if anybody has any ideas they would like to pass along please feel free to contact me.


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Upcoming meetings

Jan. 23:  Corn and Soybean Classic, Springfield, $50 fee, 333-2880 to register.

Jan. 24:  PAT training, DeWitt County, 935-5764 to register.

Jan. 24:  Certified Livestock Manager, Sangamon County, 1 (800) 345-6087 to register.

Jan. 29:  Sustainable Ag Grant Writing, Logan County, (217) 968-5512 for info.

Feb. 20:  PAT training, Logan County, 732-8289 to register.

Feb. 25:  Crop Problems Diagnostics, Logan County, 732-8289 for information.

Feel free to call the local Extension office at 732-8289 for information that is available on these programs.

[John Fulton]

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