“The majority of the crop experienced average growing conditions most of the season. Additionally, hot weather during late August and early September was expected to slightly decrease yields in some areas.

USDA’s current corn and soybean production forecasts are 13.8 billion bushels and 3.1 billion bushels, respectively, for 2013. If these production levels are realized corn production will be about 3.1 billion bushels larger than a year ago (28.4 percent) and soybean production will be about 0.1 billion bushels larger than a year ago (4.4 percent).

Corn and soybean futures prices have fluctuated widely this year due to the vagaries of the weather and forecasted larger crops projected for this year, says Prevatt.

 

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“Corn and soybean prices are expected to move lower in 2013 due to the potential of increased supplies worldwide. Therefore, livestock farmers should seriously consider taking steps to procure their feed purchases during the 2013 crop harvest.”

The tight stocks-to-use ratios of U.S. soybeans will keep market analysts monitoring the sizes of crops in Europe, Asia and South America, he adds.

“Soybean prices are high and should encourage additional production. Favorable weather and growing conditions will be extremely important to reduce the pressure on soybean stocks to use ratios.”

Another factor that can affect feed prices and feeder calf and feeder cattle prices is the level of export demand for corn and soybeans, says Prevatt.

“Any major changes in world export demand for these commodities and/or their by-products could significantly move market prices.”

Economic growth in several Asian countries has begun to slow down. Additionally, the strength of the U.S. dollar is certain to influence the world export demand, as a weak U.S. dollar improves U.S. grain export demand, he says.

Fortunately, pasture and range conditions have been better over many of the cow-calf states this year, says Prevatt.

“These improved pasture and forage conditions, coupled with lower feed prices and higher cattle prices, may result in more heifers being retained and fewer mature animals being culled in 2013 and 2014.

“Due to the drought during the last three years, a higher number of beef and dairy cows were sent to slaughter which should result in a younger cowherd on farms.

“The current weather forecast for the Southeast is for the 2014 winter to be colder and drier than normal and the summer to be hotter than normal with near-normal rainfall.