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Veteran Advisor
Posts: 1,034
Registered: ‎10-18-2016
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Are Prices As Bad As They Can Get?

Does the large crop in the bin and the prospect of another large crop next year mean that prices are as bad as they can get and we might as well sit on the sideline and wait for things to get better?

Veteran Contributor
Posts: 91
Registered: ‎07-04-2011
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Re: Are Prices As Bad As They Can Get?

We dont have to pay them to take it yet so prices can still go down. I think it would be a mistake to think prices are as bad as they can get and become complacent about marketing. That said, I havent done anything for 2018 other than cash contract a tiny fraction of expected production and buy some March corn calls to reown a portion of 2017 sales.
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Advisor
Posts: 1,376
Registered: ‎08-04-2010

Re: Are Prices As Bad As They Can Get?

Ive not been farming as long as you Jim, but I have seen sub $3 corn in the decade that Ive farmed so I think we could still go a little lower. My feeling is that the commodity markets will be dead for a while longer. Buying back a crop that you've already sold for a low price seems to me a bad move in a low volatility environment. In a low cost/profit environment is where bins will make somebody money. Note, I don't have bins nor do I have the extra money to buy my way back into the casino. 

Honored Advisor
Posts: 7,659
Registered: ‎07-18-2011
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Re: Are Prices As Bad As They Can Get?

that last statement is profound, blacksand.

 

If a crop is profitable and one would like to invest some profits in an ongoing trend ..... reowning a little is entertaining and can be worth the risk.  But it is not a plan to make a looser profitable.  That is ignoring a trend.

Veteran Advisor
Posts: 2,990
Registered: ‎02-11-2013
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Re: Are Prices As Bad As They Can Get?

in answer to the question..........NO

Esteemed Advisor
Posts: 2,495
Registered: ‎04-29-2011
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Re: Are Prices As Bad As They Can Get?

"the prospect of another large crop next year"    There you go assuming........again.

Veteran Advisor
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Registered: ‎10-18-2016
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Re: Are Prices As Bad As They Can Get?

"the prospect of another large crop next year"    There you go assuming........again.

 

What other prospect is there?  What other assumption is to be made?

 

Are you going to cut back?  No.  Are any of your neighbors going to cut back?  No.  Is supply going to balloon?  If so, based on what?  Can you predict the weather?  No.  

 

The logical assumption is there will be a big crop next year.

 

 

Honored Advisor
Posts: 7,659
Registered: ‎07-18-2011
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Re: Are Prices As Bad As They Can Get?

Amazing you know all those answers before the farmer gets out of the bank....... No wonder usda gets by with assumptions based on assumptions.

Veteran Advisor
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Registered: ‎10-18-2016
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Re: Are Prices As Bad As They Can Get?

SW, if you are not making these assumptions, then what assumptions are you making?  

 

Your reply seemed to turn my assumptions into answers.  I did not give them as answers.  They are projections of where we will be based on where we've been and the likely future.

 

I assume the sun will come up in the morning.  In the East.  Is there anything wrong with that?

 

I assume it will be cold for a few months and then better.  I assume the local college football team will have a just slightly better than mediocre season.  These things happen almost all the time.  What is wrong with assumptions?

 

I agree that assumptions that become answer are wrong.  The people who turn a USDA projection into their own prediction are painting themselves into the same corner.

 

An assumption is not set in concrete, but it does give a direction until new facts develop new assumptions.  

 

USDA wasn't so far off on the crop this year and people still have a knee-jerk refusal to give them any credit.

 

Do you assume the sun will come up tomorrow, SW?  You may assume I'll plant my farm and if you want to turn that into an answer I guess you can.  Smiley Happy

Esteemed Advisor
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Registered: ‎04-29-2011
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Re: Are Prices As Bad As They Can Get?

[ Edited ]

Little to no fertilizer applied this fall.  Seed and chemicals are not yet ordered or paid for.  Most farmers, including me, certainly do not need prepaid inputs to offset income like the past several years.    I do have an idea on what I will plant.  However, it will be a bare bones type of year as far as inputs go.   I assume........that I am not alone in this type of thinking.  

So....to assume that we will have record year of acres and yields is simply ludicrous.  I don't think that I would classify your projection as logical.