09-19-2013 06:04 AM
And what a difference a day makes! I got out of my bean short at the end of the day yesterday. I'm still stinging from my impact with the windshield yesterday.
Man!!!- what a turn of events from the finance ministers meeting! The dollar broke through long term support yesterday with the "no taper" decision. And we now sit at the lowest levels since last February. Stocks, bond, commodities look to resume or continue uptrend's as our dollar suffers on the world market. Like someone said a few days ago reference our exports, "it's all about the dollar." And yes, yes it is.
I, along with most everyone who paid attention to the taper talk, really expected to see us back off on the dollar printing. Not yet. My stocks did well yesterday, and I was checking in to how to buy the US Dollar Index, or something that would mimic it, but decided not to do it. Dropping a dollar on the index would have made for an even worse day than just smacking the windshield yesterday morning. We are going higher - on lots of fronts. Stock market probably will be starting with a 16 in front of it very soon. Petroleum products across the board is very bullish. Grains, well, let's just say that $15.00 beans looks a lot better today than what I saw yesterday morning upon wakeup. Sales are through the roof already. CX1 may be right - $15.00 is probably not enough at this point to ration our bean crop. Like Shaggy's picture of the beans show in the field picture posting - put a fork in the bean production - it's done. Most beans, even the late ones are turning. The rain is we have gotten is going to help very little to cure the ills of this summer. This cop is going to need some fairly serious rationing. The top on this kettle is about to blow....
09-19-2013 06:23 AM
Rain is bullish now........it will delay harvest. These endusers need the grain now. Empty bins and empty train cars for as far as the eye can see....
09-19-2013 06:34 AM - edited 09-19-2013 06:35 AM
Jen, do you think that the lows in grains are in? The bears may have gotten ahead of themselves, but what a great opportunity for those that need to buy the grain! Let's hope they don't wait too long to buy. The opportunity is now!
Geez, this sounds just like the guys who were promoting the sell your grain before the basis falls off the cliff thing. They were correct in their thinking, but maybe didn't realize that we could possibly come back to a level close to that sooner than anyone thought possible.
09-19-2013 06:48 AM
Maybe there will be plenty of corn around everywhere with the reports of better than expected yields. But, just wondering how does that basis cliff thing work in reverse?
09-19-2013 06:48 AM
This market has been bullish for a long time. It's the strength of the dollar that was keeping it in check. Yesterdays break of the long term uptrend from the dollars low of 72.86 on 5-6-2011 is big. We will probably test the lows around 79.00 made in February, and then see from there. Our exports were good BEFORE this drop in the dollar. This should start to make us very competative on the world market again. It's going to be and interesting day to see how everything shakes out. I'm always concerned on days like this though - and it comes back to market manipulation. My war chest is pittens against those investing in this market. It's still very prudent to be careful.
09-19-2013 07:02 AM
RT, I felt that before this drop in the dollar that we were getting close to the bottom on the corn. These levels are simply too cheap. Our biggest problem is going to be quality. And that is something that is not well understood. Talk to livestock people about feeding 52 pound test weight corn vs. 56 pound or better. Let's say that you are feeding 10 dairy cows 10 pounds of grain each. 100 pounds right? Shouldn't matter if the corn is 52 lbs or 56 lb corn, it's still 100 lbs right? WRONG! And that's what a lot of people miss. These two test weights contain vastly different amounts of starch - the energy contained in the kernel. You may need to feed 110 to 120 lbs of the light weight stuff to equal what was in the heavier kernel. I know, I know. You'r going to say, "Jen - I don't believe you on THIS one for sure." Check it out. I don't have the data on this one in front of me. Maybe someone does. But it's the same when you burn the stuff in your corn stove. The light weight stuff hardly puts out any heat. It's like burning a nice solid piece of Oak, vs burning box elder. Get it now? They both burn, but the energy contained in the unit of measure is not the same.
Usually, elevators try to blend this low test weight crap off with good corn, but when little of the really good corn is available, what do you do. You feed and ship the crap....
09-19-2013 07:03 AM
or something? Trust me, ya'll are about to get a lesson you won't forget if you think this market has bottomed out. I'm in SE Illinois....an area where we haven't had a rain since 7/18 . . .We did get .3 yesterday....whoopee....that was a real turn around.
Cash corn here yesterday was $ 4.16. Pass that bong over here would you so I can hallucinate my way out of reality.
Ya'll better be hoping for a harvest low with a $ 3 in front of it. The worst case scenario for anone now would be a price rally into the harvest price period.....which will leave anyone with a near APH yield totally screwed.
09-19-2013 07:15 AM
BF - that may very well be the case. I was talking to my crop insurance man yesterday to get an idea of what producers here are saying about the crop. In general, most farmers here (in South East MN) are expecting 2/3 of a crop - both corn and beans. Well that sucks like you said. At a 70% crop insurance level, that first 30% of loss is the farmers. That certainly takes the top off of one's profits. Then you add in the potential discounts for the light corn, and the market making a rally....ouch.....that's going to leave a mark...
09-19-2013 07:22 AM