11-13-2012 11:36 AM
Sell all old-crop and 20% of your 2013 crop, one analyst says.
He says, "Old crop soybeans have been most affected by the recent increase to supply estimates by the USDA. South American weather is not a factor until it is. Right now we have seemingly favorable conditions down there and we are not overly concerned about missing the production estimates made by the USDA. The current USDA estimate for world soybean carryout is not overly bullish at this time. Our strong export sales pace is a concern of ours but China has stacked most of what they are expected to contract up front. Even with the recent export demand allowances made by the USDA on the November WASDE report we are still at 71% sold. Again, the market is in liquidation mode and seems to agree that export demand will substantially slow down in the coming months. The most important factors to watch in my opinion are export bookings between now and the January reports as well as the January stocks number. If this most recent price setback creates new interest in US soybeans again than we will probably have to switch back to rationing mode.
I have told my producers to sell everything and re-own using March calls, they get a better deal on the backward market that way and still have upside potential without "betting-the-farm". I am cautiously optimistic that we will see a rebound in prices as we have not slowed demand enough yet. I have also recommended selling 20% of the 2013 crop."
11-13-2012 11:49 AM
Is this the same guy or at least his twin that says "don't worry about the Nat'l debt", "BORROW MONEY TO MAKE MONEY", also told us to sell last spring before prices went to $10 beans and $4. on corn?
Sooner or later he might be right.
the truth is that we are still over $7 on corn (not too much)
and in the high 13's on beans. Not a bad nieghborhood.
We are still at or near the top third of prices. More has been sold at less than these prices than above them.
11-13-2012 11:57 AM
This is a different guy. So, if I'm understanding you correctly, you are not a fan of selling the crop and owning it back via futures or options?
I agree that it seems prices, though setback this month, are still at appealing levels to sell into.
11-13-2012 12:20 PM
NO fan what so ever. If prices are going to go up delay the sale.
If prices are going down sell it now, pay the tax, and don't give another 10 to 50 cents away to a broker for options that do not move or pay off like futures or physical does.
If you really want to take less for it sell it to me for that reduced price now... I'll send you a gift at Christmas and if it is quite a few bu's, birthday time too.
The brokers only make money if you let them, They are no different than barkers out front at the girlie show.
If you want to speculate that is fine ... set up a corp and when it is broke and you get tired of funding it, go back and be a farmer.
There has been way too much blurring of the lines between farming and gambling on the board of trade.
This has gotten to be high stakes. Take that money and go to Vegas, show it to the Casino and they will put you up in a nice room and feed and water you till it is gone, or you strike it rich. At least there you get bells and whistles, bright lights, and a show.
11-13-2012 12:38 PM
I'm okay with making a few sales in 2013, but I also don't agree with selling all the remaining 2012 crop and reowning with futures or options. We had a short crop. One could be potentially giving up a tremendous amount of money via basis appreciation. My money is still on buying puts to protect the downside and holding the physical for a basis play. Now that we're down nearly four bucks from the highs, I find it interesting analysts are recommending sales now. There were a lot of savvy traders/producers who recommended sales in July when we took out all time highs. Sure, one would have missed the high by a buck. However, this would be better than throwing in the towel nearly four bucks later. I also have to wonder about the recommendation considering what the technicals are telling us. When was the last time the RSI was below 15? We're getting some pretty strong buy signals in here on beans.
11-13-2012 01:30 PM
i'm on your page, Gored Husker.
all my analysis is telling me yesterday and today are capitulation in both corn/soy. fakeout down in corn. i'm betting strong end users were hedging like nobodies business on the buy side yesterday....i read on some commentary where the open interest change indicated a negative bias....for who?, i would ask.....as for the comments above.....so, all of a sudden S.A. prospects do an about face and go from a shaky start to planting to ALL TIME RECORD WORLD SUPPLIES AGAIN...before Dec????????
Hobby, me thinks we've heard this all before within the last year...
11-13-2012 03:07 PM
U.S. corn yield average is 116 bu./acre not 122.3 like the USDA says, according to a European firm. The firm uses satellite imagery, ground-truthing and weather forecasts to project the yield, according to the Dow Jones Newswire.
Hmmmm...116 huh? What do you think? Is it that low?