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Senior Contributor
steeringwheelholder
Posts: 178
Registered: ‎05-13-2010
0

Very little 2013 sold

I see where the analysts and know-it-alls on Twitter and at the farm conventions are in a tizzy on the American Farmer's behalf because we have little to none sold for this fall. Corn and beans are reportedly 5% sold compared to a normal 25-30% at this stage. I would agree from speaking with my local buyer that there is hardly any contracted ahead.

So, what's the play here? Are we all waiting for another drought? Do we expect China to buy corn and make a rally for Dec 13 corn opportunity? Experts say buy a bunch of puts and lock in a $5 floor. Why not sell today and buy calls? I'm honestly scratching my head for the right strategy and wishing that $6+ bid last fall for '13 didn't seem cheap like it did when cash was $8+. Your thoughts and moves??
Advisor
c-x-1
Posts: 2,913
Registered: ‎06-26-2012
0

Re: Very little 2013 sold

....assuming "the experts" are the brokers wishing they had more usual farmer business for this time of year....sometimes "no action yet" is the  best strategy/play...this appears to be resounding in the community.

 

ask yourselves why new crop is now priced about a dime cheaper than it was 3/5/2012. What's with the deflation? Is it a trap? Does the mkt know 2013 production will be much better?

 

 

Senior Contributor
NDf
Posts: 323
Registered: ‎05-13-2010
0

Re: Very little 2013 sold

IMO with less than a 650 m bu carry out for corn there are a lot of things that could go wrong that we could have a nice spike up in prices so why not wait and maybe buying a few defense calls now and sell later if the spike occurs

Advisor
c-x-1
Posts: 2,913
Registered: ‎06-26-2012
0

Re: Very little 2013 sold

Seems to be what the strong $$ is telling us, NDf.....The experts are squirming and trying to "market" to customers to "protect" this low price now in case it just goes lower from here. 

Frequent Contributor
noreaster
Posts: 61
Registered: ‎01-24-2012
0

I've never raised my dream crop yet!

...and thats exactly what the market has priced into the equation......A DREAM!!!!

 

Mark Goldylocks is on agweb once a week that corn yields could hit as high 16 billion...  BUY OPTION!!!, PROTECT YOURSELF!!! YOUR GONNA MISS THE BEST OPPORTUNITY!!!! CORN COULD EASILY BLOW THROUGH $4.50!!!!  PUTS ARE CHEAP!!! GET COVERED!!! blah blah blah blah... SMART FARMERS ARE GETTING COVERED!!!! puke, consume, blah blah blah...THE WEATHER PATTERNS HAVE SWITCHED!!!

 

Don't get me wrong, the potential is there TODAY in dream-land for a huge crop...Maybe 13.8-14 billion assuming all things blessed on all bases... But I'm so sick of the rhetoric these "MARKET ADVISERS" spew...  And they wonder why guys aren't calling...

 

 

 

 

 

 

 

 

Senior Advisor
kraft-t
Posts: 9,829
Registered: ‎05-10-2010
0

Re: Very little 2013 sold

sure it is dryer than a popcorn phart but there is alot of time for rain and crop improvement. So a buyer for long term delivery can hold back for the time being.

Senior Contributor
steeringwheelholder
Posts: 178
Registered: ‎05-13-2010
0

Re: Very little 2013 sold

Noreaster, you hit exactly what I'm referring to. They make money on the trades. And I think they can say how dumb we are as the market goes down in the meantime they are buying corn like crazy. Bad mouth it so it goes lower making an even better buy. These same guys were screaming last year to get it all sold at $5.50 just like they are now.

But what if they are right? Some have been screaming for us dumb farmers to get it sold from when we sat in the combines last fall. Who would contract several thousand bushels today for a $6.20 or even a $6 bid? I would sell over 50% for sure if that was offered right now. They could be right and looking at the charts, it is one long skid since New Years. Beans too.

Personally, we are going to have a repeat drought. Maybe not as widespread or severe as '12, but the western corn belt is still seriously dry. I think we will see selling opportunities ahead, but I get real nervous wondering if the highs are way past us.
Veteran Advisor
Shaggy98
Posts: 3,428
Registered: ‎06-19-2011
0

Re: Very little 2013 sold

My advisor recommended to me that I buy back any 2013 bushels already forward contracted.  I received the message just this morning.  One thing for sure, the brokers are making money on all these contracts.  I'm just about finished with them.  I'm glad I hadn't contracted a single bushel.

Frequent Contributor
noreaster
Posts: 61
Registered: ‎01-24-2012
0

Re: Very little 2013 sold

I have been forward contracting profits enough to meet fall payment obligations and crop loans just to be assured...

 

The rest is

 

Grow it, bin it, sell it....

 

I know it's old school, but I got my hind-end re-cut in 2008 market fiasco after listening to my market guru.... NEVER AGAIN!!!

 

Oh yeah, got a new market guru..........ME

 

 

Advisor
c-x-1
Posts: 2,913
Registered: ‎06-26-2012
0

Re: Very little 2013 sold

[ Edited ]

From my vantage point, Dec has absolutely no risk premium built into it. Plainly spoken, current "new" price has nothing to do with reality, and everything to do with opportunity.