Corn Case

The issue I did for this project was the Corn Prices, and how much is expected to be fed as feed to cattle. The corn prices are projected to increase next April due to lack of availability of corn for feed. The prices of corn are also affected by the production of ethanol from corn to put in gasoline. Another use of corn is used for feed use in cattle, pigs and sheep. The corn price is going up and in April is used to project the prices on their futures board. The export tons effect the prices in U.S. with more tons exported the price rises. The next section will about availability and the use of ethanol.

The use of corn has to be limited to certain places it can be used and what for. Mother Nature frosted in North Dakota 180 Million dollars' worth of corn. Drought in the summer and flooding in the spring contributed with the part of mother nature rearing its nasty little head. They use DDGS (dried distillers grains with soluble). They use 172,000 tons of DDGS for 54 million gallons of ethanol. The Dairy farms will find it hard to feed all of the milk cows in the next year or so. The business companies that make corn based foods will need to have corn at their disposal. Now we will have the USDA report on the corn prices an d how much it will cost per head of animal per day in a feedlot.

The futures of corn come from the CBOT (Chicago Board of Trade). The future board looks at the Corn futures states that April 2012 will approach $130 for feeder cattle hundredweight. In December, the futures fell by $1.75 bushel. Calves under 700 lbs will eat a lot more feed grains. According to USDA estimates, availability of beef will be down 54.3 lbs

per capita in 2012. This year alone the USDA expects a record of 2.7 billion lbs of beef was exported. Next September the corn futures price will be under $6 a bushel. In 2012, if so, this represents and added 150 to 200 million more bushels used for feed use. Next, corn exports to foreign countries are projected to be higher and will substantially impact domestic corn prices. Corn exports to China were 900,000 mts from the United States. 292,100 mts were sold to an unknown destination, and 261,200 mts corn was exported to Mexico. The 2011 US growing season projected harvest at 33% complete at the end of last week, which is down 17% from last year. Producers should have about 1/3 of their new crop production sold with strategies to rehedge at a higher price level in December. With exports going to China and other countries, domestic supply is reduced considerably and will affect the corn price on the rise due to supply and demand. As demand goes up and supply goes down, the price will no doubt go up. "Based on the most recent USDA projections and the assumption that year-ending stocks need to be maintained at or above 5 percent of consumption, corn use would need to be reduced by only about 30 million bushels, or 0.2 percent, during the year ahead." The actual