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Veteran Advisor
Posts: 2,272
Registered: ‎02-11-2013
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Goodbye, Farewell and Amen

[ Edited ]

I don't know if this post will survive the glaring eye of the person tasked to keep this forum on the air.......

but...  here goes

 

This was the ttitle of the last installment of M*A*S*H.  It was a bittersweat show....how happyness about the conflict being over, and everyone

going home....but many friendships would be broken up, and many memories, good and bad....were to be made...

 

If fear, the same can be said of the current state of agriculture.....but rather than people being happy about going home, frankly

i can't see anything to be happy with..

 

while the number of farmers is at a all time low, they have the ability to feed all of us....with plenty to spare......and somehow (more later)

how they can do this at such low costs.  When compaired to raw food costs, it has been the lowest to go up in price......compair many other

things.

 

but lets look at the things on the horizon................

first, when the big table is set in the the whitehouse friday.....all chairs will be filled, save one........agriculture.

no other industry touches every american, like agriculture, and is one of few industrys that does help offset trade balaces.

but, while agriculure is important, it is somewhat like the ugly sister.  when the dollar is down, the stock market is down,

that seems to be a better time for agriculture....we can export better when the dollar goes down, and when the stock market goes

down, money tends to flow to commodities.

but......what do we see........

a report today that the dollar will get even stronger.........china is becomming more mad at us, and the makings of a trade war,

and even more countries than china......when a 30 %tax of "sale" value of an import.....even talk making mexico mad...they are

one of our biggest buyers......yet we hold the cost of building a wall over their head....not the best way to make more sales.

to make things even worse....today the fuels industry wanted the epa to do away with the renewable fuels....and the epa said

no.......but....the new epa.........we are not sure, considering over half the cabinet has strong ties to the oil industry.

imagine what will happen if we cut ethanol production, have a trade war with china and mexico.........now we've got nato

mad at us.....and we are holding hands with russia singing kumbaya.......

i've seen some of the suggestions to healthcare insurance.....there was a reason why we got rid of those kind of policys.......

just an example...one would pay 50% of your medications while in the hospital....and no prescription coverage outside of

the hospital......

we were told how GM was going to save a bunch of job...how they are going to invest $1 billion in plants....yet the

day tweety bird is putting his hand on the bible....GM is giving 2,000 works pink slips.....

Ford was hailed for it's action on a factory in mexico.....the truth, there already is a factory in mexico......

 

we are looking at increaded expenses......oil goes up, which it will, higher energy cost....higher fertilzer cost...higher herbicide costs.....

bayer wants to go together with another seed company......they talked to tweety about it.....he thought it was good.....we don't

have an ag person to weigh in........but those impacted, the farmers.........their voices are mute.

 

we are looking at lower prices........and don't think you'll be seeing much to help farmers.......those that tweety bird listens too

are aginst farm program......aginst crop insurance.......basicly against agricultrue....and we can see.......we don't have

a seat at the table.........

 

so, this might be the time for agiculture to say Goodbye, Farewell and Amen........

 

The song that was used throughout the series was "sucide is painless"

www.youtube.com/watch?v=4gO7uemm6Yo

 

kind of makes me wonder.......does the "suicide" mean continue to farm ?

 

thru early fog i see visions of things to be...........

 

farms get bigger, small towns go away...less and less profit on production, more and more consolidation on

the inputs, higher prices, and fewer and fewer places to sell our grain...

 

the pains that are witheld for me.........yes, trying to figure out how we can cut even more costs, just to stay

where we are at.....

 

that suicide is painless....it brings on many changes....and i can take it or leave it if i please.......

 

so, if we continue to farm.....are we committing suicide ?

perssonal

emotional

physical

financial

 

the sword of time will pierce our skins

it doesnt hurt when it begins

but as it works its way on in

the pain grows stronger

watch it grin....

 

like agriculture....slow, suttle things take effect..lower and lower return each year, not alot each time reduced, but suttle.....

 

it is said, if a frog is placed in a bucket of water, and the bucket and water is slowly heated, that the frog will not jump out

and will be cooked.......

 

the same with us ?

 

 

I can take it or leave it if i please..........

 

 

which are you going to do ?

 

 i'm going to be looking over things tonight........and try to decide if i'm going to commit suicide another year.....or leave it

 

for those of you out there that perhaps the banker has made that decision for you, i know a number of fellows from the crisis from the

70's, and early 80's......for some, that was the best thing to happen to them........

yes.....there is life after death.

 

good luck to all of us

 

 

Veteran Advisor
Posts: 3,344
Registered: ‎07-19-2010
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Re: Goodbye, Farewell and Amen

Maybe a Trump Smart plan to break the farmers, so the oil companies can buy up the land cheap and control the biofuel market.

Yup - Trump is your buddy. He owes you guys. You'll learn - Trump is for Trump....

Tick Tock....

Jen
Advisor
Posts: 578
Registered: ‎10-18-2016
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Re: Goodbye, Farewell and Amen

It's interesting and maybe revealing that this soliloquy was posted on the Marketing Talk page.  It had very little to do with marketing.  Maybe if we'd all learn to market we wouldn't worry so much about all the other factors we CAN'T control.  We can control more about marketing than we want to admit, if we accept responsibility for it.  For the producer, marketing is at least half about hedging, which we see very little of on this page.

Veteran Advisor
Posts: 2,272
Registered: ‎02-11-2013
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Re: Goodbye, Farewell and Amen

[ Edited ]

ok jimbo.............first thing i'll let you tackle............basis

 

also if you noted, items imacting the markets were included....such as a trade war, how would that impact the market.....also

how a stronger dollar will impact markets.

 

when the people start to roll over and just let things happen.....that is how things have gotten to this point......yes there are

things you CAN do.......you can contact your reps, and let them know how you feel......yes that does have an impact....esp when

they see it can impact their getting back in.

 

if need be......support some national associations that support your views.......

 

 

did i say it will reverse everything.......no.......but you've got to try.........but i have to admit, i'm getting the feeling it will not do much

good.

 

i think my posting presents the thoughts of many......should we continue to do what we are doing, at lower and lower prices, and rising

costs.....all to benefit someone else........should i kill myself to get an extra nickel per bushel ???

should we all be boiled frogs ?

many questions are about the markets, and farming future.

 

if you are the camp, you pull your cap down....say i can't do anything about it, and pour on more fertilizer, used the most advanced seed

that happened to be the most expensive.....chasing that maxium yeild......and trying to do something buy hedging, but spending

10% of the projected price in hedging costs.....or having guts to buy and selling out of money options, etc, or buying a futures contract

that may or may not require you to be meeting margin calls.....

i think people are starting to ask themselves.......is it really worth it................

but......what else am i to do ??

 

 

Veteran Advisor
Posts: 2,272
Registered: ‎02-11-2013
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Re: Goodbye, Farewell and Amen

Looks like agriculture will have someone at
the table...with 36 hours to spare !

Let's just hope and pray he can fight for us

He has a heck of a job ahead of him.

Good lucky to Sonny and all of us.

Looks like the piggy ball will be active after all !
Veteran Contributor
Posts: 121
Registered: ‎06-08-2010
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Re: Goodbye, Farewell and Amen

I agree with Jim on the personal responsibility note.   I for one is more worried about the national debt and its day of reckoning than who will be Secretary of Ag. Those long rants may be thearaputic to you, eventually you will have to move on and get over who was elected.  I wish you well.

Highlighted
Senior Advisor
Posts: 972
Registered: ‎05-20-2010

Re: Goodbye, Farewell and Amen

I'll say a Hail Mary for you today elcheapo. You really should seek some couseling help. I'm sorry it costs so much to get grain from your neck of the woods to the user. Life sucks sometimes...get some help. Having an auction is hardly the end of the world, happens all the time, and some of the happiest farmers I know, work for Simon Property Group, or Gaylor Electric, in Indy making $40 an hour plus benefits. Your skill set is certainly in demand.

 

Not poking at all, I hear the desperation and just want you to get better.

Honored Advisor
Posts: 14,035
Registered: ‎05-13-2010
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Re: Goodbye, Farewell and Amen

Don`t sweat the petty things or pet the sweaty things.  Farming always has had challenges, for many of us we will probably be the last generation on the farm, things change and I hate change.  There`s a Bible story about a rich man building and accumulating so much, but he was a fool because he died that night.  We`re just here a short time really, so enjoy yourself, it`s not to say you shouldn`t be prudent, but have fun and if you don`t laugh 80% of the time and have a smile on your face so as people think you`re a little off, you`re not doing it right.  Just remember God loves us and this time we`re on earth is a blink of an eye.

 

http://www.cgg.org/index.cfm/fuseaction/Library.sr/CT/BS/k/840/The-Parable-of-Rich-Fool.htm

Advisor
Posts: 530
Registered: ‎06-03-2010
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Re: Goodbye, Farewell and Amen

Elcheapo,

 

You ask some good questions.  The answer is the same.  There are many times in life when you have to put how  you 'feel' on the back burner and just put one foot in front of the other and 'do' what you can.  We can't control what happens, but we can control how we act.

 

These lean times have made me a much better operator.  From Hobby's bin advice, to keeping more of the income on the farm by doing own spraying and direct purchases of inputs. Only thing that makes me upset, is that didn't do it sooner.

 

If I didn't farm, there is a whole world out there, I would find something and be ok. Another job would allow me to have more time for a hobby or just helping other people. My hope has never been in a job, or a farm, or people anyway.

 

Take care, my friend.

Honored Advisor
Posts: 7,123
Registered: ‎07-18-2011
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Re: Goodbye, Farewell and Amen

hidden in here somewhere is a good example of what Jim said......... and why.

 

I agree with elcheapo that basis is a problem and is not reflecting the price it takes to get the grain to market.  It appears to be enhancing profits for the middleman in noncompetitive markets or at least cushoning their risk in a potential volatile market.

 

But the underlying mistake is that establishing price in the process of hedging is accoumplished in one giant step........ when most often it takes several steps.

 

There are actually three distinctly different processes to go through,,,,, Futures (or world price), basis (or the local adjuster), and  logistics of delivery...

 

Cheapo's inference was that he cannot hedge because of basis..... That could be true if the local coop is his only access to forward pricing.  They may not allow him to seperate world price from present basis.....depending on what types of contracts are available.

But if he could establish a price in futures like now in beans at say 10.28 March 2018.  He has protected the most volatile of the three.  Then wait for basis to adjust  to contract with the elevator and pull his position in the futures.  Now he has a full hedge in place.

 

I struggle with the same mental blockage occasionally........ and the patience, especially for old crop, to wait on all 3 aspects of hedging to "get in line" when futures begin to show some "future" thinking, is difficult and occasionally doesn't happen. Yet if we want to take advantage of opportunity in a market that may be in a profitable level.........

 

For me, Beans are not something we use our storage for, long term.  It is going to turn to cash in the fall or very soon after.  So I am thinking a fall price over $10 sounds like a good place to start. I been dancing with this girl for a couple of months now and patience has been rewarded 30-40 cents.... If I'm going to produce 100 loads of beans this fall,  selling 10 on the board at 10.25 is a nice place to start.

the basis at the processor is not good now history wise....  I'll wait set the delivery contract and let them know I am interested when they get ready to bid for supply in the fall.   The third part, delivery price hasn't changed much in years.... a backhaul for meal or fertilizer Ill get that in the fall...     ------( I have no intention of chasing margin calls for 100 loads of beans,,,,, but it lets me start on the project when my elevator or processor is not interested in committing.)

 

TIME ---- the best tag 

Time is just a critical factor in the process ............... most usually the elevator softens the issue somewhat,,,, but in truth knowing the flow and needs of the industry tells you when the basis changes(traditionally)

 

The wifes nephew is world class on the subject from his years with fcstone.  His first instructions when we established our elevator was a simple instruction....... "Chart your basis every year"  know the seasonal changes of basis and grain flow.    When he told my son that it had been consistant for decades.    Ethanol and it's new feed ingredients, volatility, and  more world demand have distorted basis and possibly changed it somewhat.  But eventually basis will again reflect industrial movement of grain and its products.  As the industry changes so does basis.

 

Anyway hedging is not always simple... but is what we need to be doing when the possibilities are present..... and one of the three legs of the stool is not affected by the others, but all three determine price.