CME Group GIC Overview

CME Group GIC Overview Dave Lehman Managing Director of Commodity Research and Product Development

September 12, 2018

© 2018 CME Group. All rights reserved.

Disclaimer Neither futures trading nor swaps trading are suitable for all investors, and each involves the risk of loss. Swaps trading should only be undertaken by investors who are Eligible Contract Participants (ECPs) within the meaning of Section 1a(18) of the Commodity Exchange Act. Futures and swaps each are leveraged investments and, because only a percentage of a contract's value is required to trade, it is possible to lose more than the amount of money deposited for either a futures or swaps position. Therefore, traders should only use funds that they can afford to lose without affecting their lifestyles and only a portion of those funds should be devoted to any one trade because traders cannot expect to profit on every trade. All references to options refer to options on futures.

Any research views expressed those of the individual author and do not necessarily represent the views of the CME Group or its affiliates. The information within this presentation has been compiled by CME Group for general purposes only. CME Group assumes no responsibility for any errors or omissions. All examples are hypothetical situations, used for explanation purposes only, and should not be considered investment advice or the results of actual market experience.

All matters pertaining to rules and specifications herein are made subject to and are superseded by official rulebook of the organizations. Current rules should be consulted in all cases concerning contract specifications CME Group is a trademark of CME Group Inc. The Globe Logo, CME, Globex and Chicago Mercantile Exchange are trademarks of Chicago Mercantile Exchange Inc. CBOT and the Chicago Board of Trade are trademarks of the Board of Trade of the City of Chicago, Inc. NYMEX, New York Mercantile Exchange and ClearPort are registered trademarks of New York Mercantile Exchange, Inc. COMEX is a trademark of Commodity Exchange, Inc. All other trademarks are the property of their respective owners.

Copyright © 2018 CME Group. All rights reserved.

© 2018 CME Group. All rights reserved.

Agenda • US Agricultural Trade Overview • Soybean Impact • Futures Price, Volume and OI - Soybeans - Corn - Lean Hogs • Ag Barometer

© 2018 CME Group. All rights reserved.

Trade Overview

© 2018 CME Group. All rights reserved.

US Agricultural Trade FY 2012­19 Overview

• 2019 exports are projected at $144.5 billion, up $500 million from the revised forecast for fiscal 2018.

This increase is primarily due to higher exports of wheat and horticultural products, which offset expected declines in oilseeds, livestock, and dairy product exports.

• 2019 imports are forecast at $126.5 billion, $2.0 billion higher than fiscal 2018 due to increases in horticultural and sugar and tropical products.

• The U.S. agricultural trade surplus is expected to decline by $1.5 billion in fiscal 2019 to $18.0 billion.

US Agricultural Trade 2012­19 (billions USD) $160

$152.30

$140 $135.90

$141.10

$140.20

$139.80

$144.00 $144.50

$129.60

$120 $100 $80 $60 $40 $20 $0

2012

2013

2014

Exports

2015

2016

Imports

2017

*2018 *2019

Balance

Source: USDA, Economic Research Service © 2018 CME Group. All rights reserved.

5

US Agricultural Exports FY 2018 vs 2019 • The value of US agricultural exports to China in 2019 is projected to decrease $7 billion or 37% in comparison to 2018.

• However, the value of US agricultural exports to Top 20 Other US Trade partners is projected to increase 7.5 billion or 7% in comparison to 2018

US Agricultural Export value with China vs Top 20 Other Trade Partners (billions USD) $140 $120

108.8

116.3

$100 $80 $60 $40 $20 $0

19

12

China

Top 20 Other Trade Partners

2017

*2018

*2019

Source: USDA, Economic Research Service © 2018 CME Group. All rights reserved.

6

USDA Soybean, Corn, and Wheat Export Inspections 2016­2018 (1000s Metric Tons) 3,500 3,000 2,500 2,000 1,500 1,000 500 0

6 6 6 6 6 6 6 6 6 6 6 6 6 7 7 7 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 8 01 20 1 201 201 2 01 20 1 20 1 201 201 20 1 2 01 20 1 2 01 201 20 1 201 201 2 01 20 1 20 1 201 20 1 20 1 2 01 201 201 20 1 201 201 2 01 201 201 201 20 1 20 1 2 7/ 4 / 3 / 1 / 8 / 6 / 3 / 1 / 8 / 5 / 3 / 0 / 8 / 5/ 2 / 2 / 0 / 7 / 5 / 2 / 0 / 7 / 4 / 2 / 9 / 7 / 4 / 1 / 1 / 9 / 6 / 4 / 1 / 9 / 6 / 1/ 2/ 3/ 3/3 4/2 5/2 6/2 7/2 8/1 9/1 0/1 1/1 12/ 1/ 2/ 3/ 3/3 4/2 5/2 6/2 7/2 8/1 9/1 0/1 11/ 12/ 1/ 2/ 3/ 3/2 4/2 5/2 6/2 7/1 8/1 1 1 1

Soybeans

Corn

Wheat

Source: USDA, Agricultural Marketing Services © 2018 CME Group. All rights reserved.

7

5/ 23 / 7/ 2 0 18 13 / 9/ 2 0 12 13 / 11 2 0 /7 13 /2 1/ 0 1 3 2/ 2 / 20 27 1 4 / 4/ 2 0 1 24 4 / 6/ 2 0 1 19 4 / 8/ 2 0 1 14 4 / 10 201 /9 4 / 12 2 0 /4 14 / 1/ 20 29 14 / 3/ 2 0 2 6 15 / 5/ 2 0 2 1 15 / 7/ 2 0 1 16 5 / 9/ 20 10 15 / 11 2 0 1 /5 5 12 /20 /3 15 1/ 2/ 2 01 25 5 / 4/ 2 0 21 16 / 6/ 2 0 16 16 / 8/ 2 0 1 1 16 / 10 2 0 /6 16 / 12 2 0 1 /1 6 / 1/ 2 0 1 26 6 / 3/ 2 0 1 23 7 / 5/ 2 0 1 18 7 / 7/ 2 0 1 13 7 /2 9/ 0 17 7/ 11 20 /2 17 12 /2 /2 017 8/ 2/ 20 22 17 / 4/ 2 0 1 19 8 / 6/ 2 0 1 14 8 /2 8/ 0 1 8 9/ 20 18

US Soybean Yearly Accumulated Commitments to China 2013­Current (1000s Metric Tons) 40,000

35,000

30,000

36,661

27,861

25,000

20,000

15,000

10,000

5,000

0

• 2017 vs 2018 YOY showed a 8,800 thousand MT reduction in total accumulated soybean commitments from US to China, an approximate 24% decrease Source: USDA, Economic Research Service © 2018 CME Group. All rights reserved.

8

US Soybean Yearly Accumulated Commitments to EU 2013­Current (1000s Metric Tons) 6,000

5,000

5,619 4,760

4,000

3,000

2,000

1,000

0 1 3 1 3 1 3 1 3 1 4 1 4 1 4 1 4 14 1 4 1 5 1 5 1 5 1 5 15 1 5 1 6 1 6 1 6 1 6 1 6 1 7 1 7 1 7 1 7 1 7 17 1 8 1 8 1 8 1 8 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 30 8/1 0/3 2/5 2/6 /10 /12 /14 /16 /18 /19 /23 /25 /27 /29 /31 3/3 5/5 7/7 9/8 /10 /12 /16 /18 /20 /21 /23 /25 /29 /31 8/2 5/ 1 1 4 6 8 10 1 2 2 4 6 8 10 1 2 1 3 5 7 9 11 1 3 5 11

• For the US to EU, 2018 YOY showed an additional 859 thousand MT in total accumulated soybean commitments when compared to 2017, an approximate 18% increase Source: USDA, Economic Research Service © 2018 CME Group. All rights reserved.

9

US Corn Yearly Accumulated Commitments to Mexico 2013­Current (1000s Metric Tons) 18,000

15,419

16,000 14,000

14,039

12,000 10,000 8,000 6,000 4,000 2,000 0 1 3 1 3 13 1 4 1 4 1 4 1 4 1 4 1 4 1 5 1 5 1 5 1 5 1 5 1 5 15 1 6 1 6 1 6 1 6 1 6 16 1 7 1 7 1 7 1 7 1 7 1 7 17 1 8 1 8 1 8 1 8 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 29 24 19 13 10 6/5 /31 /25 /20 /15 /12 5/7 7/2 /27 /22 /17 /11 4/7 6/2 /28 /22 /17 /12 3/9 5/4 /29 /24 /19 /14 2/8 4/5 /31 /26 8 / 1 0 / 12 / 2 / 4/ 7 9 11 1 3 8 1 0 12 2 7 9 11 1 6 8 1 0 12 5 7

• 2017 vs 2018 YOY showed a 1,380 thousand MT increase in total accumulated corn commitments from US to Mexico, an approximate 10% increase Source: USDA, Economic Research Service © 2018 CME Group. All rights reserved.

10

Soybean Impact: Trade and Price

© 2018 CME Group. All rights reserved.

Projected Tariff Impact on 2019 US Soybean Exports • Overall, USDA ERS forecast total oilseeds and products exports down $1.4 billion; soybean exports are forecast to fall $800 million to $21.0 billion as both volumes and unit values decline, in large part due to weakening demand from China.

© 2018 CME Group. All rights reserved.

12

US Soybean Exports to China 2015­2018 (1000s Metric Tons) 2,500

2,000

1,500

1,000

500

496.1 August 2016 vs 2018

285.6

August 2017 vs 2018

63.3

0 5 5 6 6 6 6 6 6 6 7 7 7 7 7 7 7 7 8 8 8 8 8 5 5 5 5 6 6 6 7 7 8 8 01 20 1 20 1 2 01 20 1 20 1 201 20 1 201 201 201 2 01 201 20 1 2 01 2 01 201 20 1 20 1 201 201 201 2 01 201 201 20 1 201 201 20 1 20 1 201 201 201 2 9/ 3 / 7 / 2 / 6 / 1 / 4/ 0 / 4 / 9 / 3 / 8 / 1/ 6 / 0 / 5 / 9 / 3 / 0 / 4/ 8 / 3 / 7 / 1 / 6 / 0 / 4/ 8/ 5 / 9 / 4 / 8 / 2 / 7/ 8/1 9/1 0/2 1/2 2/3 2/ 3/1 4/1 5/1 6/2 7/2 9/ 10/ 1/1 2/1 1/1 2/2 3/3 5/ 6/ 7/1 8/1 9/2 0/2 1/3 1/ 2/ 3/1 4/1 5/2 6/2 8/ 1 1 1 1 1 1 1

• August 2017 vs August 2018 US soybean exports to China decreased 78%

Source: USDA, Agricultural Marketing Services © 2018 CME Group. All rights reserved.

13

US FOB vs Brazil FOB Soybean Basis September 2017­Current (Cents per bushel) 250.00¢

200.00¢ July 6 th ­ US and China impose first round of tariffs 150.00¢

May 29th ­ WH releases statement that it will impose tariffs April 20th – US Treasury Sec says tariffs are “on hold” April 3rd - Trump Threatens Tariff

100.00¢

~ 180¢

50.00¢

0.00 1 7 1 7 1 7 17 1 7 1 7 1 7 1 7 1 7 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 8 2 5 0 8 3 1 7 4 5 1 4 1 5 7 5 2 16 2 9 9 8 4 1 8 1 5 8 3 9/ 9/1 9/2 0/1 0/2 11/ 1/2 12/ 2/1 1/ 2/ 2/2 3/ 3/2 4/ 4/1 5/ 5/1 5/2 6/ 6/2 7/ 7/1 7/3 8/1 8/2 / 1/ Brazil­US Diff 1 1 1 1US FOB 1

US FOB Gulf Basis (¢/bu)

Brazil FOB Paranagua Basis (¢/bu)

• Prior to April 3rd, average Brazil­US diff ~ 26¢ • Since implementation of 1st round of tariffs, average Brazil­US diff ~ 170¢ Source: Bloomberg, Commodity3 © 2018 CME Group. All rights reserved.

14

Chinese Dalian Soybean Crush Margin ­ US Gulf vs.

Santos Brazil ¥600.00

¥400.00 June 15th – China finalizes $50 billion retaliation list of 25 percent tariffs, including US soybeans ¥200.00

¥0.00

­¥200.00

­¥400.00

­¥600.00 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 01 201 201 201 20 1 201 201 20 1 20 1 20 1 2 01 201 201 20 1 2 01 2 01 201 201 20 1 20 1 201 201 201 20 1 20 1 201 2 01 201 20 1 2 0/ 7/ 6/ 3/ 0/ 2/ 9/ 6/ 8/ 5/ 5/ 2/ 6/ 0/ 2/ 9/ 6/ 3/ 6/ 3/ 7/ 3/ 4/ 1/ 1/ 8/ 5/ 9/ 3/ 1/ 1/ 1/1 1/2 1/3 2/ 2/1 2/2 3/ 3/1 3/2 3/2 4/ 4/1 4/1 4/2 5/ 5/1 5/1 5/2 6/ 6/ 6/1 6/2 7/ 7/ 7/1 7/2 7/3

US Gulf ­ Dalian Soybean Crush ­

Santos Brazil ­ Dalian Soybean Crush

• After China’s June 15th announcement, the Chinese crush margin for US origin soybeans dives into the negative territory Source: Bloomberg, JCI © 2018 CME Group. All rights reserved.

15

¥3,200

¥1,400

¥3,100

June 15th announcement

¥1,200

¥3,000

¥1,000

¥2,900 ¥2,800

¥800

¥2,700 ¥600

¥2,600 ¥2,500

¥400

¥2,400

¥200

¥2,300 ¥2,200

¥0 Import Cost­CNF US Gulf Diff

CNF Price US Gulf (Left Axis)

CNF Price Santos Brazil (Left Axis)

Import Cost – CNF US Gulf Differential

CNF Price US and Brazil

Impact of Tariff on Chinese Import Cost of US Soybeans vs CNF Price US Gulf & Santos Brazil

• After China’s June 15th retaliation list announcement, CNF US Gulf rates decreased or remained the same, while the cost of importing US Soybeans increased 20 percent • CNF Santos Brazil rates increased roughly 15 percent Source: Bloomberg, JCI © 2018 CME Group. All rights reserved.

16

6,000

1060.00¢

5,000

1040.00¢

4,000

1020.00¢

3,000

1000.00¢

2,000

980.00¢

1,000

960.00¢

0

940.00¢

Price

Volume per Minute

US Soybean Futures April 3rd and 4th

Hours (CST) Volume

Average Price

• April 3rd : Trump Administration releases $50 billion list of 1,333 Chinese Products under consideration for 25 percent tariffs • April 4th: China publishes list of 106 products subject to forth coming 25 percent tariffs as retaliation, covering $50 billion of China’s imports from US Source: CME Liquidity Tool © 2018 CME Group. All rights reserved.

17

V o lu m e p e r M in u te

US Soybean Futures July 24th

880.00¢ 875.00¢

2000

870.00¢

1500

865.00¢

1000

860.00¢

P ric e

2500

855.00¢

500

850.00¢

0

845.00¢ Hours (CST) Volume Average of price

• July 24th : US administration announces it will subsidize American farmers for up to $12 billion for their lost export sales • CME Liquidity Tool ­ data and downloadable charts for: • Bid­Ask Spread • Book Depth • Cost to Trade Source: CME Liquidity Tool • cmegroup.com/liquiditytool © 2018 CME Group. All rights reserved.

18

Futures: Price, Volume & OI

© 2018 CME Group. All rights reserved.

Soybean Futures: 2016­Current 900,000

800,000

Price and Volume

1150.00¢

April 3rd – US releases initial $50 billion list of Chinese products for 25% tariff

1100.00¢

700,000

1050.00¢

600,000

1000.00¢

500,000

950.00¢

400,000

900.00¢

300,000

850.00¢

200,000

800.00¢

100,000

750.00¢

0

700.00¢

6 6 6 6 6 6 6 6 6 6 6 6 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 7 8 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 /2 4/2 8/2 8/2 0/2 0/2 3/2 2/2 4/2 4/2 5/2 6/2 0/2 2/2 4/2 6/2 6/2 8/2 1/2 0/2 2/2 1/2 4/2 5/2 7/2 2/2 2/2 4/2 4/2 7/2 6/2 4 1/ 2/ 3/ 4/ 5/1 6/1 7/1 8/1 9/1 0/1 1/1 2/1 1/2 2/2 3/2 4/2 5/2 6/2 7/3 8/3 10/ 11/ 12/ 1/ 2/ 3/1 4/1 5/1 6/1 7/1 8/1 1 1 1

Volume

1,000,000

Soybean Price (¢ per bushel)

Month­end OI

902,477

800,000 600,000 400,000 200,000 0 15 1 6 1 6 1 6 1 6 1 6 1 6 1 6 1 6 1 6 16 16 1 6 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 17 1 7 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 1 1 0 0 1 0 9 1 9 9 1 0 1 8 1 0 9 8 9 0 1 1 1 9 9 1 0 1 8 1 1 1 9 /3 1/2 2/2 3/3 4/2 5/3 6/3 7/2 8/3 9/3 0/3 1/3 2/3 1/3 2/2 3/3 4/2 5/3 6/3 7/3 8/3 9/2 0/3 1/3 2/2 1/3 2/2 3/2 4/3 5/3 6/2 7/3 8/3 12 1 1 1 1 1 1 © 2018 CME Group. All rights reserved.

20

Soybean Futures: September 2017­Current Price and Volume

900,000

May 29th: After Mnuchin said tariffs were “on hold”, US releases statement that it will impose tariffs on $50 billion Chinese goods

800,000

1100.00¢ 1050.00¢

700,000

1000.00¢

600,000

950.00¢

June 15 th: China issues updated retaliation list targeting us agriculture

500,000 900.00¢ 400,000 850.00¢

300,000

800.00¢

200,000 100,000

750.00¢

0

700.00¢ Volume

1,000,000

Soybean Price (¢ per bushel)

Month­end OI

902,477

800,000 600,000 400,000 200,000 0 15 1 6 1 6 1 6 1 6 1 6 1 6 1 6 1 6 1 6 16 16 1 6 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 1 7 17 1 7 1 8 1 8 1 8 1 8 1 8 1 8 1 8 1 8 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 1 1 0 0 1 0 9 1 9 9 1 0 1 8 1 0 9 8 9 0 1 1 1 9 9 1 0 1 8 1 1 1 9 /3 1/2 2/2 3/3 4/2 5/3 6/3 7/2 8/3 9/3 0/3 1/3 2/3 1/3 2/2 3/3 4/2 5/3 6/3 7/3 8/3 9/2 0/3 1/3 2/2 1/3 2/2 3/2 4/3 5/3 6/2 7/3 8/3 12 1 1 1 1 1 1 © 2018 CME Group. All rights reserved.

21

Corn Futures: September 2017­Current 1,200,000

Price and Volume

450.00¢ 430.00¢

1,000,000

410.00¢ 390.00¢

800,000

370.00¢ 600,000

350.00¢ 330.00¢

400,000

310.00¢ 290.00¢

200,000

270.00¢ 0 7 7 7 7 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 /2 2/2 0/2 8/2 6/2 6/2 4/2 1/2 9/2 7/2 8/2 6/2 4/2 2/2 3/2 1/2 2/2 0/2 7/2 5/2 6/2 6/2 4/2 2/2 2/2 0/2 8/2 6/2 4/2 4/2 2/2 1/2 8/2 8/2 6/2 5/2 3/2 3/2 1/2 8/2 6/2 4/2 4/2 1 9/ 9/1 9/2 9/2 10/ 0/1 0/2 11/ 11/ 1/1 1/2 12/ 2/1 2/2 1/ 1/1 1/2 1/3 2/ 2/1 2/2 3/ 3/1 3/2 4/ 4/1 4/1 4/2 5/ 5/1 5/2 5/3 6/ 6/1 6/2 7/ 7/1 7/2 7/3 8/ 8/1 8/2 9/ 1 1 1 1 1 1

Volume

250.00¢

Corn Price (¢ per bushel)

Month-end OI 2,500,000 2,000,000

1,961,824

1,500,000 1,000,000 500,000 0 5 6 6 6 6 6 6 6 6 6 6 6 6 7 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 7 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 /2 9/2 9/2 1/2 9/2 1/2 0/2 9/2 1/2 0/2 1/2 0/2 0/2 1/2 8/2 1/2 8/2 1/2 0/2 1/2 1/2 9/2 1/2 0/2 9/2 1/2 8/2 9/2 0/2 1/2 9/2 1/2 1/2 1 /3 1/2 2/2 3/3 4/2 5/3 6/3 7/2 8/3 9/3 0/3 1/3 2/3 1/3 2/2 3/3 4/2 5/3 6/3 7/3 8/3 9/2 0/3 1/3 2/2 1/3 2/2 3/2 4/3 5/3 6/2 7/3 8/3 12 1 1 1 1 1 1 © 2018 CME Group. All rights reserved.

22

Lean Hogs: September 2017­Current Price and Volume 120,000

90.00¢

July 6 th ­ China imposes 25% tariff on US pork imports June 5 ­ Mexico imposes 10% tariff on chilled and frozen pork imports from US th

100,000

80.00¢

80,000

70.00¢

60,000

60.00¢

40,000

50.00¢

20,000

40.00¢

0

30.00¢

7 7 7 7 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 /2 2/2 0/2 8/2 6/2 6/2 4/2 1/2 9/2 7/2 8/2 6/2 4/2 2/2 3/2 1/2 2/2 0/2 7/2 5/2 6/2 6/2 4/2 2/2 2/2 0/2 8/2 6/2 4/2 4/2 2/2 1/2 8/2 8/2 6/2 5/2 3/2 3/2 1/2 8/2 6/2 4/2 4/2 1 1 2 / 1 /2 Hogs 1 /2pound) 9/ 9/1 9/2 9/2 10/ 0/1 0/2 11/ 11/ 1/1 1/2 12/ 2/1 2/2 1/ 1/1 1/2 1/3 Vol 2/ ume 4/ 4/1 (¢ 5/ 5/1 5/2 5/3 6/ 6/1 6/2 7/ 7/1 7/2 7/3 8/ 8/1 8/2 9/ 2/ 2/ 3 3/ Lean 3 4/ per 4 1 1 1 1 1 1

Month-end OI 300,000 250,000

258,657

200,000 150,000 100,000 50,000 0 15 16 16 16 16 16 16 16 16 16 16 16 16 17 17 17 17 17 17 17 17 17 17 17 17 18 18 18 18 18 18 18 18 20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 /20 / 1 9 1 9 1 0 9 1 0 1 1 8 1 0 9 1 8 9 1 1 9 0 0 8 1 0 1 1 9 1 9 0 1 /3 1/2 2/2 3/3 4/2 5/3 6/3 7/2 8/3 9/3 0/3 1/3 2/3 1/3 2/2 3/3 4/2 5/3 6/3 7/3 8/3 9/2 0/3 1/3 2/2 1/3 2/2 3/2 4/3 5/3 6/2 7/3 8/3 12 1 1 1 1 1 1 © 2018 CME Group. All rights reserved.

23

Monthly Futures Volatility: Soybeans, Corn and Lean Hogs

65 55 Percent Volatlity

45 40 35 30 25 20 15 10 5 0 1 3 1 3 14 1 4 1 4 15 1 5 1 5 16 1 6 1 6 17 1 7 1 7 18 18 g- ec- pr- ug- ec- pr- ug- ec- pr- ug- ec- pr- ug- ec- pr- ugu A D A A D A A D A A D A A D A A

Lean Hogs

45 35 25 15 5 1 3 13 14 14 1 4 15 15 1 5 16 1 6 1 6 17 1 7 17 18 1 8 g- ec- pr- ug- ec- pr- ug- ec- pr- ug- ec - pr- ug- ec- pr- ugu A D A A D A A D A A D A A D A A

Corn 40 30 Percent Volatlity

Percent Volatlity

August 2013­August 2018 Soybeans

20 10 0 1 3 13 14 14 14 15 1 5 15 16 16 1 6 1 7 17 17 18 18 g- ec- pr- ug- ec - pr- ug- ec - pr- ug- ec- pr- ug- ec- pr- ugu A D A A D A A D A A D A A D A A © 2018 CME Group. All rights reserved.

24

Ag Economy Barometer

© 2018 CME Group. All rights reserved.

Monthly Indicator of Sentiment towards U.S. Farm Economy

• CME Group and Purdue University began collecting data in October 2016 • Monthly sentiment survey, published first Tuesday of every month • 400 farmer and rancher surveyed each month ensures that the results are reliable with a 95% confidence level interval of +/­ 5%.

• Minimum targets by enterprise reflect 2010 USDA Census of Agriculture -

53% corn/soybeans 19% beef cattle 14% wheat 6% hogs 5% dairy 3% cotton

• All respondents have a value of farm production above $500,000.

• Methodology and all past results available at www.purdue.edu/agbarometer © 2018 CME Group. All rights reserved.

26

U.S. Farm Sentiment Plummeted in July on Trade War Fears Modest uptick in Aug on Trump farm aid package 26 point drop in July; single­largest one­ month drop in barometer history

© 2018 CME Group. All rights reserved.

Farmers Split on Impact of Trump Relief Plan Nearly half said aid will not relive concerns about impact of tariffs on their farm income

© 2018 CME Group. All rights reserved.

28

Thank you

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