ERS Charts of Note
Wednesday, April 8, 2015
South Africa’s 2014/15 corn production is forecast at 11.5 million tons, down 23 percent from the previous year. Area harvested is expected to be unchanged from a year earlier, but yields are forecast to drop 10 percent from the 5-year average due to heat and dryness during critical growth stages. South Africa is normally one of the world’s top 10 corn exporters, with exports averaging 2.1 million tons over the last 5 years. While favorable weather and growing conditions in most major corn producing countries is supporting record world corn yields in 2014/15, South Africa, one of the last countries to harvest corn in the 2014/15 marketing year, is expected to lower corn exports by half to 1 million tons. South Africa produces both white and yellow corn, and both types are experiencing poor weather conditions this year. White corn is a staple food in South Africa, and due to the production shortfall it will require a price premium over yellow corn to channel it into human food use and away from feeding to animals. This chart is based on the March 2015 Feed Outlook report.
Monday, March 16, 2015
The Livestock Forage Disaster Program (LFP) was initially authorized by the Food, Conservation, and Energy Act of 2008 to reimburse eligible farmers and ranchers for grazing losses due to a qualifying drought or fire through September 30, 2011 (the end of the period covered by the 2008 Act). The 2014 Farm Act made LFP a permanent program, and included payments retroactive to October 1, 2011. ERS’s farm income forecast for 2014 includes $4.4 billion in expected LFP payments, incorporated in the direct government payments category “ad hoc and disaster assistance payments.” The 2014 forecast is an over 700-percent increase over the sum of LFP payments made during the previous 5 years. This large spike—generally regarded as a one-time event—reflects large retroactive payments for 2012 and 2013, which account for 84.2 percent of the 2014 expected payout. The 2014 Farm Act included a number of changes that could raise future LFP payments, although not to 2014’s extraordinary level. This chart is found in the Amber Waves finding, “Livestock Forage Disaster Program Payments Increase in 2014.”
Monday, February 2, 2015
U.S. exports of sorghum have surged in the past two years, growing from less than 65 million bushels during the 2011/12 marketing year to 270 million forecast for 2014/15. Sorghum is a common substitute for corn in feed rations and is also used for ethanol production in the United States. Since in most countries corn tends to be preferred over sorghum for livestock feed, U.S. sorghum exports have been trending lower for several decades. But in recent years China has emerged as a leading destination for U.S. sorghum since sorghum does not face import quotas and other constraints that often delay or restrict shipments of corn and distillers dried grains (DDGS) from entering the country. For the current marketing year (2014/15), exports are forecast to account for 62 percent of total use, the highest proportion since 1975. The strength of the export market has also helped raise the price of sorghum, which is currently forecast to average 4 percent higher than the price of corn for the current marketing year, compared to the more common tendency for sorghum to sell at a 5 to 10 percent discount to corn. This chart is based on the January 2015 Feed Outlook report.
Monday, June 3, 2013
Declining use of gasoline in the United States, combined with market constraints to growth in the blending of biofuel, have resulted in U.S. ethanol use falling short of the Federal Renewable Fuel Standard (RFS), energy legislation that mandates minimum annual levels of biofuel consumption in the United States. Annual U.S. gasoline use has declined from its 142-billion-gallon peak in 2007 to about 133 billion gallons now, reducing the size of the existing U.S. market for ethanol. Nearly all retail gasoline sold in the United States is a 10-percent ethanol blend (E10). The limited ability to expand use of higher ethanol blends creates an effective constraint on total ethanol use at near 10 percent of total gasoline consumption—the E10 blend wall. As a result, ethanol use is falling short of the portion of the RFS mandate that can be met with corn-based ethanol. This gap is expected to widen in the future as gasoline consumption declines further and the RFS mandates higher levels of biofuel consumption. This chart appears in High RIN Prices Signal Constraints to U.S. Ethanol Expansion, Feed Outlook special article, April 2013.
Tuesday, May 7, 2013
Renewable Identification Numbers (RINs) are codes assigned to batches of renewable fuel used to administer the federal Renewable Fuel Standard (RFS), which specifies minimum annual levels of U.S. biofuel consumption. Obligated parties under the RFS use RINs to report qualifying biofuel use to the U.S. Environmental Protection Agency to demonstrate compliance with their annual RFS requirements. After many years of relatively low prices for conventional ethanol RINs, those prices have recently risen sharply because RFS ethanol mandates now exceed ethanol use. This result reflects declining gasoline use and technical constraints on blending more than 10 percent ethanol in U.S. gasoline—the so-called E10 blend wall. The gap between ethanol mandates and ethanol use, together with the anticipated depletion of excess RINs from prior years, are driving up RIN prices. Additional factors that may be affecting RIN prices include uncertainties regarding potential regulatory and legislative actions. This chart appears in “High RIN Prices Signal Constraints to U.S. Ethanol Expansion,” in Feed Outlook: April 2013 (pages 18-22).
Monday, March 11, 2013
Rising incomes, particularly in developing countries, are projected to provide a foundation for continued gains in world demand and trade for grains, oilseeds, and other agricultural products during 2012-22. Developing countries, where food consumption and feed use are particularly responsive to income growth, are projected to be the main source of growth in import demand for grains and oilseeds. Trade in soybeans and soybean products has risen rapidly since the early 1990s, and continued strong demand, particularly in China and other Asian countries, is expected during the next decade. Growth in global wheat imports also remains concentrated in developing countries, but per capita wheat use has peaked in many countries, leading to more modest projected growth in wheat trade. These projections are based on a conditional, longrun scenario that assumes normal weather, a continuation of current U.S. farm legislation, and specific U.S. and international macroeconomic conditions and U.S. and foreign agricultural and trade policies. This chart is from USDA Agricultural Projections to 2022, OCE-131, February 2013.
Tuesday, March 5, 2013
Weather has been an important factor affecting global wheat, corn, and soybean production over the past several years, leading to increases in grain and oilseed prices since 2009/10. Prices for grains and oilseeds are projected to decline in the near term as global production responds to recent high prices. Nonetheless, after these initial price declines, long-term growth in global demand for agricultural products, a depreciating dollar, and continued biofuel demand, particularly in the United States, the EU, Brazil, and Argentina, hold prices for corn, oilseeds, and many other crops above pre-2007 levels. These projections are based on a conditional, longrun scenario that assumes normal weather, a continuation of current U.S. farm legislation, specific U.S. and international macroeconomic conditions, and U.S. and foreign agricultural and trade policies. This chart is from USDA Agricultural Projections to 2022, OCE-131, February 2013.
Monday, February 11, 2013
USDA projects that grain exports by Russia, Ukraine, and Kazakhstan—the major grain exporting regions of the Former Soviet Union—will expand substantially during the coming decade. Gains in grain area are expected to be modest, but higher grain yields are projected to boost Russian grain output by 22 percent and Ukrainian output by 50 percent by 2021. While growth in meat production is expected to continue to increase the demand for feed grain within the region, exportable surpluses of both wheat and corn are projected to rise. By 2021, the combined exports of Russia, Ukraine, and Kazakhstan are projected at 71 million tons, more than 90 percent above the 2006-10 average, with the region’s share of global grain exports rising from 22 percent to 29 percent during the same period. The key reason for the anticipated growth in grain production and exports is further farm-level improvements in the productivity of inputs, led by large new farm operators that have upgraded agricultural technology and management in the region. This chart appears in the ERS report Rising Grain Exports by the Former Soviet Union Region: Causes and Outlook, WHS-13A-01, February 2013.
Monday, January 14, 2013
The Southeast Asia region is a major supplier of rice to global markets, accounting for about half of the import needs of the rest of the world in 2011. In USDA's most recent projections, Southeast Asia's rice surplus is expected to continue to expand over the next 10 years. Although rice production in the region is projected to grow at a slower rate over the next decade, growth in production is still expected to outpace growth in the region's rice demand. Land constraints are expected to lead to slower growth in both rice area and production, while the diversification of diets away from rice as incomes rise is projected to slow growth in rice consumption in most of the region. Overall, Southeast Asia's net exports of rice are projected to rise from an average of 11.2 million tons during 2009-11 to an average of 14.5 million tons in 2019-21. For this analysis, the Southeast Asia region refers to Brunei, Burma, Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. This chart appears in the ERS report, Southeast Asia's Rice Surplus, RCS-12l-01, December 2012.
Friday, June 17, 2011
The United States is a major wheat-producing country, with output exceeded only by China, the European Union (EU-27), and India. Nationally, wheat ranks third among field crops in both planted acreage and value of production, behind corn and soybeans. Nonetheless, while varying widely during the past half-century, U.S. wheat area has been trending downward after peaking in the early 1980s, and is expected to do so for the foreseeable future. Past annual fluctuations in wheat area can be explained by changes in the Government's farm program, declining consumer demand for wheat products, and more recently, the relative profitability of growing competing crops. Several long-term factors play important roles in the projected downward trend of the U.S. wheat crop area for the remainder of this decade. The profitability of growing wheat relative to other crops, particularly corn and soybeans, is expected to continue declining. Two factors facilitating the planting of alternative crops, such as corn and sorghum, are the increased use of reduced-tillage and continuing genetic improvements, both of which improve yields of these alternative crops. Furthermore, wheat production in the Ukraine, Russia, and Kazakhstan is expected to continue increasing, competing with the U.S. in global markets. This graphic is from the Wheat briefing room, April 2011.