Georgia corn growers suffered through 1998 with drought ravaged crops and very low market prices. According to the Georgia Agricultural Statistics Service, Georgia farmers planted 500,000 acres to corn in 1998 and harvested 400,000 acres for grain. State wide average yields were only 80 bushels per acre. Many observers feel these numbers understate the losses incurred due to the drought and hot weather. These numbers do not reflect the loss of quality of the crop due to disease.
        In 1999, Georgia farmers will likely reduce corn acreage slightly. The primary reason is that with current prices for new crop corn, it will require well above average yields to turn a profit. At this point, a planting of 475,000 acres can be expected.
        The corn price outlook for 1999 is dominated by very large stocks going into the harvest. Even with a projected small reduction in U.S. acreage, it is probable that total supplies in the fall of 1999 will be larger than in 1998. Current projections call for U.S. acreage to fall slightly to about 80 million acres planted. Given normal harvested acres and trend yields of about 128 bushels per acre, 1999 production would be near 9.4 billion bushels. Beginning stocks will be near 1.725 billion bushels and will contribute to aa total supply of 11.13 billion bushels, up marginally from 1998.
        Corn use in the 1999 crop year will do well to equal use for the 1998 crop season at 5.85 billion bushels. While at present the U.S. livestock sector has a record large number for animal units consuming grain, continued deep losses in the hog and cattle sector point to smaller numbers eating grain during 1999. Some analysts feel a 10 to 15 percent reduction in the hog industry is needed to bring supply into balance with demand in order to restore profits to producers. Cattle numbers may see a decline in the range of 3-5 percent over the next two years. The poultry sector will likely see continued expansion throughout 1999 and into 2000 at a rate of about 4-6 percent. Domestic meat consumption remains strong. The weakness in meat demand resides in the export arena caused by financial weakness in many countries that import U.S. meats.
        Corn exports will likely be near steady for the 1999 crop marketing year compared to 1998 at about 1.7 billion bushels. Global course grain use has declined slightly over the last three years as has foreign production. This has resulted which has resulted in a buildup in stocks that can be used to meet any increased demand. Global corn trade will not likely increase unless there is a sharp reduction in production outside the U.S. The "other domestic use" category will see continued growth as ethanol production continues to increase. This category, which represents human use of field corn, has established itself as the second largest use category. It has shown steady growth and is a reliable market.
        U.S. corn ending stocks will be near year ago levels at 1.6 billion bushels. Stocks of this magnitude will prevent prices from moving sharply higher without a threat to new crop production. Georgia corn prices for the 1999 crop will remain under pressure and will likely range between $2.20 and $2.50.

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        Soybean acreage in Georgia in 1998 was the lowest since back in the 1960s with only 290,000 acres harvested. The drought ravaged the crop and yields averaged a meager 20 bushels per acre. Weak market prices contributed to farmers woes with cash prices falling below the $5.00 level during harvest before rebounding only slightly toward the end of the year.
        The outlook for soybeans in Georgia in 1999 is not much better in terms of prices and thus acreage may not show much change. One factor may contribute to more acres in soybeans this year. The dire financial stress many farmers face may result in efforts to farm with less money in 1999 and soybeans are a relatively low cost crop to grow. The problem with this scenario is that while they may not cost as much as other crops, the potential profit is low as well. This leaves the projection for Georgia acreage on other factors. Current estimates are for about 350,000 acres seeded to soybeans in 1999.
        The U.S. outlook for soybeans in 1999 points toward a slight reduction in acreage from last year, a drop of about 700,000 acres to 72 million planted versus 72.7 million in 1998. The generally weak price outlook caused by large U.S. and world oilseed supplies will keep prices depressed into the planting season. The South American soybean crop is expected to fall slightly in 1999 due to reduced acreage in Brazil. Mid season weather has been good for growth and development and thus a good crop is projected absent any late season weather problems. If U.S. acreage is near 72 million and if yields are near trend of 38.3 bushels per acre, a crop of 2.7 billion bushels can be projected. This is a large crop, the 3^rd largest ever and combined with beginning stocks of 375 million bushels could provide the first ever 3 billion bushel total supply.
        Use of U.S. soybeans will remain large for the coming marketing year spurred primarily by low prices. The expected contraction in the U.S. livestock sector will keep domestic crush near current levels of 1.65 billion bushels. Exports will also remain fairly steady at about 860 million bushels. While the south America crop may be below year ago levels, export potential has not expanded so the U.S. share of international trade will hold about steady. Total off take of U.S. soybeans will be about 2.65 billion bushels and while this may be near record levels, it will not be enough to offset the increased supply. Thus ending stocks will rise to over 400 million bushels. These stocks will place a firm cap on prices through 1999.
        Soybean prices will likely average between $5.20 and $5.50 with a strong likelihood of new crop prices moving below the $5.00 during the growing season and into harvest. This will make profitable marketing a challenge for Georgia soybean growers in 1999.

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