The slide Deck here was presented at a meeting of the Illinois Corn Growers yesterday, and my rehearsal podcast is here. The goal was not only to explain the "Rise of China" and the "Global Commodity Price Super-cycle," but also to enumerate various consequences--such as the $50 billion/year increase in input costs (led by land prices) and the advent of South America and the Black Sea as enlarged (lower cost) corn competitors, who ramped up production too, in the light of the super-high prices.
Forecasts of the future are of course difficult, and I have decided to advance one such possibility, namely a relatively optimistic one, which will require certain favorable conditions to emerge. For one thing, exports of ethanol will need a crude oil price in the $70/barrel range over the coming decade, and domestic use of ethanol will need to see more availability and use of E-15+ blends. We will also need to see China continue to buy lots of soybeans, and we will have to have input costs decline substantially to provide a decent corn-soybean net income picture, well below the 2007-2013 bonanza, but at least positive.
Maybe these things will happen, maybe no. I will discuss them further in a planned written Piece after the Jan-12 USDA Final Report, as well as comparing our Blue Sky forecast with the USDA's 10-year Baseline released in mid-December.
We will also publish the report/meeting schedule for all of 2016, and the agenda for our March 21-22 Seminar in Kansas City.
Bill
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Bill Hudson
The ProExporter Network
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