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Contributor
AgFuture
Posts: 14
Registered: ‎10-30-2013
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Short Crop long Tail

After researching history and looking at current markets, it's scary what lies ahead for corn prices. A good analysis and historical charts that Ed Usset at U of Minnesota wrote on his Ed's World site last fall sums it up...it takes a long time to buy back demand. After doing more research on the droughts years he identified 74,80,83,88,93. Prices do correct the following marketing year as we are seeing now. However, more research identified the farmer doesn't reduce corn acres like some believe we will in 2014. History shows we plant the corn acreage for a minimum of 2 years following the drought year and prices hit their lows 3-4 years after the sharp drought year. Wouldn't surprise me it all to see corn range $3.75-$4.50 in 13/14. $3.00/$4.00 in 14/15 and $2.75/$4.00 in 15/16
Why...because I hear a lot of this talk about cash war chests built up to get through some tough years...can't pay these ground prices and rents with soybeans and history repeats itself.
Senior Contributor
ray h.
Posts: 427
Registered: ‎05-14-2010
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Re: Short Crop long Tail

    If you are stupid enough to think that corn with a 3 in front will sustain,you must be some one from the third world,or simply farming the gov. It seems logical that a producer would do every thing in their power to crimp the supply and rest this one out! Bin,plant some thing eles,tell the land lord we will see you the next go around!Rest some land!

Contributor
AgFuture
Posts: 14
Registered: ‎10-30-2013
0

Re: Short Crop long Tail

Wow...I hit a nerve Ray. Ask the cattle feeder if $200 a head losses was sustainable for 18 months. You refer to me a stupid or third world...look in the mirror. What's the price of over supply have to do with sustainability??? The guy buying the product doesn't care about operating cost and he just paid $8.00 a bushel for 9 months. Let land rest...in this kill for ground market. Again...you call me stupid??
Advisor
c-x-1
Posts: 3,136
Registered: ‎06-26-2012
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Re: Short Crop long Tail

I don't "buy" the having to buy back demand part after seeing last yr play out -- it's still alive and well -- believe USDA currently has exports underestimated by 300 - 500 mil bu and total usage even more...while price stays below $6.00

 

remember it's partly a shell game where usage (that did occur last yr - but was invisible) will show up on this years ledger.

Senior Contributor
crophugger
Posts: 217
Registered: ‎01-12-2012
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Re: Short Crop long Tail

Can't export a product that is not available.

Advisor
c-x-1
Posts: 3,136
Registered: ‎06-26-2012

Re: Short Crop long Tail - not smokin' a thing

[ Edited ]

C = $6.25 - $6.75 by early spring.

B = ?? (price) - bottom line (ending stocks) will be unch or go down on report.

 

even though there is no biological possibility of more beans b/c of lack of rain 8/1 -9/15, if USDA reports a higher yield it means it was actually higher on Sep report than reported (due to est. error, etc.)......the actual, actual went down......no physiological doubt about it.

 

so even if they report a full bu higher, we may have 30-35 mil extra bu which will easily already be taken in usage rows.

 

writing is already in pipeline

Senior Contributor
bkadds
Posts: 300
Registered: ‎04-29-2011
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Re: Short Crop long Tail

Cx--are you hitting the bottle early tonight thinking corn will be $6.25-6.75 by spring? I would bet you one fine restaurant meal on that one!
Advisor
c-x-1
Posts: 3,136
Registered: ‎06-26-2012
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Re: Short Crop long Tail

[ Edited ]

no sir, no drinking either....it's part technicals, where the $$ is overbalanced, moving in sympathy with what I believe's going on in the beans some.......we live in a competitive grain world whose landscape is entirely different than 20-30 yrs ago. Also, may take those prices to get any more outta Arg?

 

Won't it take $5.50 - $6.00 before the US farmer lets go of much more? the Big comm $$ is at least 4% longer than when price was last 3 -- rallied to 4.50 pretty readily.

 

--realize I'm venturing into whacko waters a bit with that, but on balance....................................??? I still don't completely buy the 13.5B or better.....sub 13 on final would not completely surprise.

 

......and we are not out of the extreme weather patterns either.

Advisor
c-x-1
Posts: 3,136
Registered: ‎06-26-2012
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Re: Short Crop long Tail - wkly Corn chart

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Senior Contributor
425Cat
Posts: 1,504
Registered: ‎05-14-2010
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Re: Short Crop long Tail

Cx, not gonna happen corn won't be able to get thru 5.50 .