Fundamentally Speaking
Joel Karlin DTN Contributing Analyst

Wednesday 04/22/15

Corn & Soybean Plantings by May 20th
Percent of the U.S. corn and soybean crop planted as of May 20 vs. the change in U.S. soybean planted acreage.[Read Full Blog Post]
Posted at 9:39AM CDT 04/22/15 by Joel Karlin | 0 Comments | Post a Comment
 

Friday 04/17/15

Accuracy of USDA Initial Ending Stocks Estimates
USDA change in its estimate for U.S. corn and soybean ending stocks from the first WASDE estimate given in May to the final one 18 months later the following November[Read Full Blog Post]
Posted at 7:50AM CDT 04/17/15 by Joel Karlin | 0 Comments | Post a Comment
 

Wednesday 04/15/15

Lowest New Crop Soybean Sales in 5 Years
USDA export projection for new crop soybeans given at their annual February Ag Outlook Forum, their first 'official" projection contained in the May WASDE report in million bushels, and new crop sales as of the first week of April as a percent of that May WASDE export projection.[Read Full Blog Post]
Posted at 9:57AM CDT 04/15/15 by Joel Karlin | 0 Comments | Post a Comment
 

Monday 03/30/15

Prospective 2015 U.S. Soybean Yield
15, 20 and 25 year trends for U.S. soybean yields calculated three different ways[Read Full Blog Post]
Posted at 8:46AM CDT 03/30/15 by Joel Karlin | 0 Comments | Post a Comment
 

Thursday 03/26/15

Possible 2015 U.S. Trend Yield for Corn
15, 20 and 25 year trends for U.S. corn yields calculated three different ways[Read Full Blog Post]
Posted at 10:34AM CDT 03/26/15 by Joel Karlin | Post a Comment
Comments (3)
Maybe the more important yield is the mid-point (median) of the yield distribution rather than average (mean) distribution/trend line yield. If the 15 year distribution of US yield has a trend line of 158.5, the mid-point is something like 160.7 or 2.2 bushels higher. The 20 year yield distribution has an average of 161.9, mid-point of 164.0 or some 2.1 bushels higher. The 25 year distribution has an average of 162.3, mid-point of 164.7 which is 2.4 bushels higher. The mid-point is where there is an equal chance of having a higher or lower outcome. The 15 year average has about a 60% chance of seeing yields higher than the average. The 20 and 25 year yield distributions have about a 62% chance of having yield higher than their average/trend line. Freeport, IL
Posted by Freeport IL at 8:40AM CDT 03/27/15
Your general premise still holds true. USDA's yield seems high. There looks to be a 70% to 85% chance of seeing US yields below 166.8. The percent chance depend on the yield distribution selected. Freeport, IL
Posted by Freeport IL at 9:05AM CDT 03/27/15
I attended a webinar (not DTN's) last month and raised the point that the past 7 year average yield for corn is approximately 153; and maybe something less than 160 would be more realistic than what the government is calling for. Especially where producers may be cutting back on fertilizer and plant population. My comment was dismissed as being "unrealistic." I still believe there's good reason to be bullish 2015 corn from current price levels.
Posted by John Giegler at 12:25PM CDT 04/14/15
 

Tuesday 03/24/15

Soybean Acreage Changes in Top States
Top corn states and change in acreage from March intentions to final in years from 2010 to 2014 with five year average.[Read Full Blog Post]
Posted at 8:46AM CDT 03/24/15 by Joel Karlin | 0 Comments | Post a Comment
 

Monday 03/23/15

Corn Acreage Changes in Top States
Top corn states and change in acreage from March intentions to final in years from 2010 to 2014 with five year average.[Read Full Blog Post]
Posted at 9:55AM CDT 03/23/15 by Joel Karlin | 0 Comments | Post a Comment
 

Sunday 03/15/15

Palmer Drought Ratings in Top Corn & Bean States
Palmer Drought Severity Index (PDSI) as of the end of February for the top 21 corn and soybean producing states and the U.S.[Read Full Blog Post]
Posted at 12:57PM CDT 03/15/15 by Joel Karlin | Post a Comment
Comments (3)
Not sure where in Michigan we have that much moisture reserved. But i do know we are dry in southeast part of state. This Jan. was the 1st since 1936 that we had no measurable snow. What snow we had left last week and we can drive on fields already. Tile have quit running and ditches are low. We were very dry all last summer also.
Posted by Raymond Simpkins at 8:37AM CDT 03/17/15
Really dry in SW Nebraska. Winterkill in wheat is a real problem and will increase as we wait for moisture.
Posted by Unknown at 4:24PM CDT 03/18/15
High energy punch is in place in pacific. West of Mississippi is going to be interesting !
Posted by JOHN JANSSEN at 12:05AM CDT 03/20/15
 

Wednesday 03/11/15

Relation Between U.S. Dollar & CME grain markets
Correlation coefficients of the U.S. dollar index vs. a number of markets for a period of three months and six months along with one year, five, ten and fifteen year intervals.[Read Full Blog Post]
Posted at 10:09AM CDT 03/11/15 by Joel Karlin | Post a Comment
Comments (1)
We came up with this simple model to illustrate the strong dollar yielding weaker commodity prices. It has three members: US, export and importer. Let's say at year one all three countries had their different currencies worth par with each other; 1 dollar bought one unit of exporter or importers currency and vice versa. So $4.00 per bushel corn would be bought with 4 units of importer's or 4 units of exporter's currency. Year two catches all three countries equally in a worldwide mess. Because the three countries were hurt equally their currency values between themselves did not change. Year three finds the US with an improving economy because of their earlier actions. This makes the rest of the World want to invest in the US. They invest in the US economy (buy dollars) to get the most return on their investments in the strong economy. So they move investment from the import and/or export country to the US; selling imports and exports currency to buy US dollar. There is so much buying and selling going on that the relationship of the currencies change. In our simple example let's now say it takes 2 units of imports or 2 units of exports currency to buy $1.00. The corn price is based in US dollars. Assuming the price in dollars didn't change, a $4.00 bushel would require 8 units of imports currency to buy one bushel of corn and export could sell a bushel of for 8 units of their currency. The relationship between importer's and exporter's currency has not changed; it is still one unit for one unit relationship between importer and exporter. But the cost to the importer has doubled from 4 units to 8 units whether he trades with the exporter at one to one exchange ration and pay exporters price of 8 units or buys US corn at $4.00 per bushel and uses two units of his currency to buy one dollar. The price change in the importer's local currency because of the stronger dollar results in the importer buying less and the export producing more. So supply goes up as a new production year is completed because of the exporter is producing for the higher local price. "Extra" demand drops with the currency change because the cost to the importer in his local currency went up. There is still a strong base demand for commodities. Basic demand does not and/or cannot change all that much in the shorter run. Now let's add China as an importer. Let's say their currency is fixed with the dollar; so 1 China currency buys one dollar or 2 exporter currency as in year three above. The price to China did not change from year one as it did with the importer. Now in year three, because of the one to one relation with the dollar, it cost China 4 units to buy from the US or 8 units to buy from the export. But because 1 China currency buys 2 exporter units the cost is still 4 units. In general, correlation of dollar versus level of exports is hard for us to find. If the World needs what we have and no one else has the quantities and/or quality that are needed, we get a chance to export. Countries that do not have the initial quality and/or capacity to store their commodities will undercut US price, -whether strong dollar or not- to move their products. Transportation cost will maintain our exports to nearby markets regardless of currency value as well as limit distant markets. As others increase storage capacity - increasing carry outs- a strong dollar may/will be more of a factor. The general premise seems to be a strong dollar should/could drive down prices. But when China "ties" their currency to the dollar their demand should not drop and price declines should be less than when China was not a major importer. Freeport, IL
Posted by Freeport IL at 1:33PM CDT 03/12/15
 

Monday 03/09/15

5, 15 and 25 Year Acreage Trends for Soybeans
Soybean planted acreage trends in top producing states and the U.S.[Read Full Blog Post]
Posted at 9:41AM CDT 03/09/15 by Joel Karlin | 0 Comments | Post a Comment
 

Friday 03/06/15

5, 15 and 25 year acreage trends for corn
Corn planted acreage trends in top producing states and the U.S.[Read Full Blog Post]
Posted at 7:18AM CST 03/06/15 by Joel Karlin | Post a Comment
Comments (2)
Joel, What does "compounded annual growth rates" mean? How do you calculate them?
Posted by rick glenister at 11:59AM CST 03/07/15
Let's say we have 100 acres of hay and what grow our hay acres by 10% a year for the next 10 years. The simple interest result would be 100 acres x 10% would result in a 10 acre increase each year. So in 10 years we would have increased our hay acres by 100 (10 years x 10 acres a year) making our total hay acres 200 (100 acres we started with plus 100 acres of increase). A compound interest would not only grow our beginning acres by 10% it would increase that 10% growth by 10% each year as well. So year one would be the same 100 x 10% = 10 acres increase or 110 total acres (100 original acres plus 10 acres increase.) The second year the growth would be 110 acres x 10% =11 acre increase resulting in 121 total acres. The extra acre, when compared with simple interest, came from the increase of last year's increase. It was compounded. If one continues the math the result after 10 years should be something like 259.4 (100 acre beginning x (1 +10%)^10 years. The extra 59.4 acres (259.4 compounded result - 200 simple interest result) is do to the compounding of the prior year's growth. Hope this helps. Freeport, IL
Posted by Freeport IL at 9:23AM CDT 03/12/15
 

Monday 03/02/15

Wheat Export Sales and Shipment History
Cumulative U.S. wheat sales and shipments as of the third week of February as a percent of the USDA February WASDE export projection.[Read Full Blog Post]
Posted at 9:49AM CST 03/02/15 by Joel Karlin | 0 Comments | Post a Comment
 

Wednesday 02/25/15

Acreage Changes from Outlook to Prospective Plantings Report
Difference between the USDA's first guess on how much of the three main crops -- corn, soybeans and all wheat -- farmers will plant to the prospective planting figures given at the end of March in 1000 acres.[Read Full Blog Post]
Posted at 9:56AM CST 02/25/15 by Joel Karlin | Post a Comment
Comments (1)
Federal crop insurance is considered the prime risk management tool available to farmers. The product RP, revenue protection, provides protection of revenue from declining production and/or price. If one believes ending stocks has a relationship with CME futures price, CME option values can point to future price, corn use can be projected and historic farm/US yield relationship are repeatable, then one has a chance of handy capping the value of RP as a risk management tool. (It should be noted, at best, these numbers are educated guesses and are not expected to be accurate projections of the future.) RP pays an indemnity at the extreme lows in price and/or farm yield. Should this year's spring corn insurance price come in around $4.15 and planted corn acres come in around the 89 million acres projected at USDA's Ag Forum, then our handy capping places the indemnity/premium ratio squarely to the advantage of the insurance companies not the Stephenson County Illinois farmer. At 91 million planted corn acres it looks to be a push. (Another way to look at it; spring insurance price of $4.15 is $0.45 too low for 89 million planted acres of corn.) The next USDA look at prospective-planted acres will come after the March 16 insurance buying time: March 31 and June 30. If CME options can be used to develop future price/demand relationship then current prices and future price opportunities are currently underestimated at 89 million planted corn acres. Freeport, IL
Posted by Freeport IL at 1:32PM CST 02/27/15
 

Wednesday 02/18/15

U.S. Soybean Sales & Shipment History
Soybean sales and shipments as of the first week of February as a percent of the February soybean export projection and change in the USDA export projection from the Feb WASDE to the final export projection in million bushels.[Read Full Blog Post]
Posted at 9:54AM CST 02/18/15 by Joel Karlin | 0 Comments | Post a Comment
 

Tuesday 02/17/15

U.S. Corn Export History
U.S. corn export sales in million bushels as of the first week of February and those sales and the amount of corn actually shipped since the beginning of the marketing year September 1 as a percent of the February WASDE export projection.[Read Full Blog Post]
Posted at 9:09AM CST 02/17/15 by Joel Karlin | Post a Comment
Comments (1)
Southern hemisphere weather is curtailing corn production in some areas. South Africa, for example, may be looking at reductions of 30% or more in some areas. This might cut their exports in half. They tend to export over 2 million metric ton. So this projected reduction might add demand 40 million bushels of additional demand into other markets. The potential of added demand has not shaken Gulf basis levels. That current level indicates our shippers currently have no desire to heat up grain flow. I hope your numbers are a better indication of the future. Freeport, IL
Posted by Freeport IL at 10:14AM CST 02/17/15
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Recent Blog Posts
  • Corn & Soybean Plantings by May 20th
  • Accuracy of USDA Initial Ending Stocks Estimates
  • Lowest New Crop Soybean Sales in 5 Years
  • Prospective 2015 U.S. Soybean Yield
  • Possible 2015 U.S. Trend Yield for Corn
  • Soybean Acreage Changes in Top States
  • Corn Acreage Changes in Top States
  • Palmer Drought Ratings in Top Corn & Bean States
  • Relation Between U.S. Dollar & CME grain markets
  • 5, 15 and 25 Year Acreage Trends for Soybeans
  • 5, 15 and 25 year acreage trends for corn
  • Wheat Export Sales and Shipment History
  • Acreage Changes from Outlook to Prospective Plantings Report
  • U.S. Soybean Sales & Shipment History
  • U.S. Corn Export History
  • Corn Yields & Stocks Estimates
  • Soybean Yields & Growth for Top Producers
  • Corn Yields & Growth for Top Producers
  • Wheat Yields & Growth Rates for Top Producers
  • Prospective 2015/16 Soybean Stocks