OUTLOOK SEMINAR ANNUAL MEETING AFOA October 9, 2013
Feb 22, 2016
3
FUNDAMENTAL FACTORS IN THE FORMATION OF PRICES
Market
Growth in Consumption of
Protein
Basic supply/ demand input Energy
ExchangeInvestments
World Macro-Economic Conditions
1990/91 2013/14 % Change
Population 5.3 billion
7.10 billion
34%
Wheat 549 702 28%Coarse Grain 814 1,211 49%Rice 344 472 37%Oilseed Meals 113 269 138%Soy Meal 69 185 167%Oils & Fats 82 188 129%Soy Oil 15 44 187%Palm Oil 11 56 404%Beef & Veal 49 56 14%Pork 65 107 65%Poultry 31 88 187%All Meat 145 251 74%
World Consumption Trends(mln tonnes)
Source: USDA, Oil World
Source: USDAOil World
1990/1991
1991/1992
1992/1993
1993/1994
1994/1995
1995/1996
1996/1997
1997/1998
1998/1999
1999/2000
2000/2001
2001/2002
2002/2003
2003/2004
2004/2005
2005/2006
2006/2007
2007/2008
2008/2009
2009/2010
2010/2011
2011/2012
2012/2013
2013/2014
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
Wheat Coarse Grains OilseedsRice Total Production
Mln
. Hec
tare
sArea and Production of Grains and OilseedsArea and Production of Grains and Oilseeds
07/0
3/20
0608
/22/
2006
10/1
0/20
0611
/28/
2006
01/1
6/20
0703
/06/
2007
04/2
4/20
0706
/12/
2007
07/3
1/20
0709
/18/
2007
11/0
6/20
0712
/24/
2007
02/1
2/20
0804
/01/
2008
05/2
0/20
0807
/08/
2008
08/2
6/20
0810
/14/
2008
12/0
2/20
0801
/20/
2009
03/1
0/20
0904
/28/
2009
06/1
6/20
0908
/04/
2009
09/2
2/20
0911
/10/
2009
12/2
9/20
0902
/16/
2010
04/0
6/20
1005
/25/
2010
07/1
3/20
1008
/31/
2010
10/1
9/20
1012
/07/
2010
01/2
5/20
1103
/15/
2011
05/0
3/20
1106
/21/
2011
08/0
9/20
1109
/27/
2011
11/1
5/20
1101
/03/
2012
02/2
1/20
1204
/10/
2012
05/2
9/20
1207
/17/
2012
09/0
4/20
1210
/23/
2012
12/1
1/20
1201
/29/
2013
03/1
9/20
1305
/07/
2013
06/2
5/20
1308
/13/
2013
-200,000
-150,000
-100,000
-50,000
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000Traditional Hedge Funds
Corn FundsSB FundsSBO FundsSBM fundsCBOT Wheat FundsKBOT Wheat Funds
cont
ract
s
ARCHER DANIELS MIDLAND COMPANYARCHER DANIELS MIDLAND COMPANY
RELEVANT MARKET FACTORS PAST 18 MONTHS
Crop Losses in Soy in South America March/April 2012
Increase in the Brazilian Corn Crop May/June 2012
Crop Losses in Corn and Soy in the U.S. September/October 2012
Record Soy and Corn Crops in South America
Progress of Northern Hemisphere Crops
Continued Growth in Palm Oil Production
2013
WHEAT 2011/12 2012/13 2013/14AREA 221.7 221.3 221.9PRODUCTION 697.2 655.3 705.4TRADE 157.8 138.7 149.1TOTAL USE 696.8 680.4 699.9STOCKS 199.6 174.4 173.0STOCKS/USAGE 28.6% 25.6% 24.7%
COARSE GRAINSAREA 311.6 319.4 321.2PRODUCTION 1,154.5 1,128.5 1245.6TRADE 146.6 121.8 133.8TOTAL USE 1,154.8 1,142.9 1215.2STOCKS 165.6 151.2 181.7STOCKS / USAGE 14.3% 13.2% 15.0%
OILSEEDSAREA 258.8 263.3 267.3PRODUCTION 441.7 463.8 484.9TRADE 115.2 119.3 127.0TOTAL USE 463.4 456.8 474.0STOCKS 67.6 74.6 85.5STOCKS/USAGE 14.6% 16.3% 18.0%
WORLD CROP SUPPLY/DEMAND
(Mln. Tonnes, Mln. Hectares)
ARCHER DANIELS MIDLAND COMPANYARCHER DANIELS MIDLAND COMPANY
MARKET ISSUES
Political / Financial Issues
Final Northern Hemisphere Crop Results
Rebound in 13/14 Livestock Demand
Crude Oil / Energy Issues
Southern Hemisphere Plantings / Weather
Palm Oil Supplies / Stocks
Biofuels Issues: Political / Economic?
Farm Economics 2014?