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Senior Contributor
elcheapo
Posts: 642
Registered: ‎02-11-2013
0

who is hiting home runs ??II

I am becoming rather speechless on the markets. From my perspective nothing is making sence. A few months back it looked like we Would run out of corn, now plenty...all spring Everything showed hrw was going to be Small...now the opposite... Any advisory services been doing well ?
Senior Contributor
pritchh
Posts: 495
Registered: ‎10-18-2010
0

Re: who is hiting home runs ??II

I see it as pretty straight forward. 12/13 in corn beans was a rationing year, price had to rise enough to force using less. That happens 1/7 yrs or so. But the market can’t wait until the end of the mkting yr to then, ration, end-users can’t risk that, we rationed all yr long, 8$C did its work. Down to the finish, any enduser of any substance gas to have coverage, the norm  is the mkt process has taken place even at harvest in 12,  this yr perhaps because the mkt is coming to realize demand id more inelasctic than 10 or even 5 yrs ago,  prices held up longer and or maybe supply was smaller than the uSDA had guessed.  

 

As of July 12 old crop is pretty much over, we hear of some wild 2$ over buys somewhere last week?, locally could be some wildness left.

 

But the mkt ius starring at new crop, vs a slow start, the crop has palyed catch up with excellent conditions mid June on. Some C and S didn’t get planted, but relative to the composite it doesn’t count.

 

Trendline we need to remember reflects  average conditions, not perfect. Every yr yield isn’t below average, even in  LakeWoebegon. If weather stays as positive as it has been, we could even go over trendline, some odds anyway.

 

Though we get used to 15$ beans and 7.50 corn, reality is all commodes trend towards the cost of production over time. Back to back bad Wx equaled exceptional pricing and farm income hit records for, 2 or even 3 yrs? Someones sold land at 12k/A, others sold it to them.

 

Wheat, correct me if I am wrong HRW prod went down, it is a poor crop. World wise ES/production are positive, thus limiting price advances here. SRW I think is what pushed the total WW # up. The forecast is for 535 million bu. WAY beyond our normal food/feed/export use. It gets no discussion here, my table pounding is ignored even for discussion. Supply/demand table has huge ES, and my guess, usda is over estimating feed use. Once feed users are using new crop priced corn, IMO, WZ, Chicago is worth about 1$ less, that fast.  

Senior Contributor
pritchh
Posts: 495
Registered: ‎10-18-2010
0

Re: who is hiting home runs ??II

I think advisory services have a hard time getting bearish,  producers WANT to hear teh bukl case,

and any rational advisory who had been scaling selling teh last 2 yrs, looked bad with early sales.

I think thise items affect their objectivity even if subconscious.

Senior Contributor
Farmerjoe79
Posts: 419
Registered: ‎04-02-2012

Re: who is hiting home runs ??II

Above trendline what the heck are you snorting. Whatever it is it you should probably quit using it:smileyhappy:
Senior Contributor
Longcreekfarms
Posts: 427
Registered: ‎08-07-2012
0

Re: who is hiting home runs ??II

At least stop supplying the USDA with it! Lol
Veteran Advisor
c-x-1
Posts: 3,259
Registered: ‎06-26-2012
0

Re: who is hitting home runs ??II

allow the speechlessness to get your attention. When things that made sense before and now do not............that is called a pattern shift or change, in and of itself..............................................just like a pattern change in a market or the weather or anything else in nature...........................................

 

i wonder how the crops are making sense of their growing season, so far....can only imagine they are thrown off their game somewhat. We'll see what their perspective is in a few weeks......................................

Senior Contributor
ray h.
Posts: 437
Registered: ‎05-14-2010
0

Re: who is hitting home runs ??II

    Hey, the weather patern isn't messed up,we have  all been producing trendline,and the gov. wants to insure cheap feed for the populace.We are all effed!

Veteran Advisor
c-x-1
Posts: 3,259
Registered: ‎06-26-2012
0

Re: who is hitting home runs ??II--money pattern?

[ Edited ]

Ray, what do you make of this? and how does it look relative to other times? thx, c-x-1.

 

COT -- Supplemental Report - Option and Futures Combined Positions as of July 9, 2013                     
    :                                    Reportable Positions                                 :    Nonreportable
    :---------------------------------------------------------------------------------------- :      Positions
    :         Non-Commercial      :      Commercial   :     Index Traders :        Total
    :   Long :   Short : Spreading:    Long :   Short :    Long :   Short :    Long :   Short :    Long :   Short
-------------------------------------------------------------------------------------------------------------------
CORN - CHICAGO BOARD OF TRADE                                                                                     
CFTC Code #002602                                                              Open Interest is 1,677,143
    : Positions                                                                               :
    :  204,094   325,327   488,715   386,453   529,328   424,652    46,820 1,503,914 1,390,190:  173,228   286,953
    :                                                                                         :
    : Changes from: July 2, 2013               (Change in open interest:        -816)         :
    :   -2,794    26,606    -1,644    -3,947   -19,550     1,664     2,205    -6,722     7,617:    5,905    -8,433
    :                                                                                         :
    : Percent of Open Interest Represented by Each Category of Trader                         :
    :     12.2      19.4      29.1      23.0      31.6      25.3       2.8      89.7      82.9:     10.3      17.1
    :                                                                                         :
    : Total Traders:   780          Number of Traders in Each Category                        :
    :      159       238       262       278       298        29        19       631       665

Esteemed Advisor
sw363535
Posts: 4,675
Registered: ‎07-18-2011

Re: who is hitting home runs ??II--money pattern?

Let's take a stab at that.

 

Spreading is the lead activity ---- 29+% of the open interest. ------------- I would say we have a volatile market without direction.  Knowing it is wrong but not knowing where to go to get right.  ------- few actural hedges being placed --------- very little actual inventory being priced.  ----------- A VERY Thin trade.

Indicative of lack of supply sell or buy on the cash side. ---------- "doesn't make a difference what the price is if there is nothing in the show room to sell. "  And the wanta be buyer is driving the price down starting rumors of future supply while the seller  knows it is all just hot air until he has something to sell.  ------------ There are only a few reliable sources in the world for grain.

sw
Advisor
rayjenkins
Posts: 687
Registered: ‎05-13-2010
0

Re: who is hitting home runs ??II--money pattern?

sw has it right........we are in a market that is dominated by spread trading......this is one of the more classic old/new crop corn spread scenarios since 1996.......

 

if we get a 12.5--13.2 crop, it will be interesting to see what kind of hedging activity eventually transpires.....farmer is far undersold on new crop corn....if they can continue to hold all through harvest, we might get a pop, but that would likely be one that needs to be sold, as the corn would still be in the farmer's hands......and that is normally not a winner for the last half of a marketing year....

 

but it is a global market and things can change.......both directions!