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Economist Offers Feed Outlook

Published on 7 June, 2009, Last updated at 03:46 GMT
 

Corn prices may see increased volatility going forward according to Iowa State University economist Robert Wisner. The comments were made to producers gathered at the World Pork Expo held June 3 through 5 in Des Moines, Iowa .

Corn prices will depend heavily on weather patterns, global oil price and a possible increase to E12 or E15 ethanol use for conventional cars and its resulting additional demand on corn.

For the general economy, Wisner sees a trend toward a weaker dollar, increasing inflation and higher interest rates. Wisner points to huge U.S. budget deficits and potential cap and trade legislation as driving forces for those predictions.

The economist sees a sharp drop in South America grain production which he expects to lead to tighter world supplies. As a result, producers may face a renewal of volatile corn and soybean markets this summer.

Based on a yield of 155.4 bushels per acre for the 2009/2010 corn crop, Wisner projects a U.S. weighted average farm price of $4.25 per bushel.

As for soybeans, Wisner said that supplies are tighter than any time since 1965. Based on a yield of 42.8 bushels per acre for the 2009/2010 soybean crop, Wisner projects a U.S. weighted average farm price of $9.50 per bushel. However, producers should expect high and volatile soybean meal prices through early October.

 

 
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