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jrsiajdranch
Veteran Advisor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

The only problem with your analysis is that it is one sided! what did hogs go to in 98? or hows about cattle and milk in the early 2000's. You guys make it sound like it was 30 years of riding the gravy train on biscuit wheels.

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roarintiger1
Honored Advisor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

67guy, yours is the best post I've seen for awhile.  I remember all too well the LDP game and I do not care to go back. Many hog producers around here sold that buck something corn for over $5 through their hogs.. I for one, refuse to apoligize for the higher prices we are getting currently.

BTW, if cattle came off of grass early because of the drought and into feedlots, it would occur to me that feed demand is really much higher right now.  The only way it would be lower is if you just sent the animals to the meat processor.

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Palouser
Senior Advisor

Re: Boy that's a shocker....

If cattle on feed is a result of drought causing early placement then I'm wondering how long they feed them. Start at an earlier age than normal and feed them longer? On the other hand this has happened several times now. Cattle keep getting sent to the feed lots. Where are they coming from? MOntana? PNW? They are coming from somewhere.

 

In any case, cattle on feed are cattle on feed. If there is a falling in numbers later it might be just in time for China to take up the slack. I'm not predicting. I'm just sayin' .....

 

There was some speculation meat prices might fall with plenty in storage from the surge of feeders. Would it increase consumption? Hard to say. It might come down to the equation of what it costs to keep meat frozen.

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Palouser
Senior Advisor

Re: BS Kraft!

I don't believe that monetary policies have driven markets. And in real value I don't think grain prices are out of line, especially in a demand market. Farmers have done well while our wage earning citizens have gotten the shaft. QWe'vbe al had our ups and downs in turn.

 

I think ag is looking at a tear that is likely to become historic. Largely due to the transformation of developing countres with exploding  middle classes and entrepeneurism with the added boost of central planning - as authoritarian as it may be.

 

I think most participants in the ag world will benefit, but there are going to be some changing relationships at times.

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idalivered
Advisor

Re: BS Kraft!

JR, I'm gonna agree with you. It is just like $4 gas. Eventually we find out a way NOT to use it. In my opinion $7 corn needs to be sold 'cause feeding it and making ethanol out of it is not sustainable. This said while standing in front of the train callled crop detereoration. Sure the chinese might buy it, but at some end users cannot keep it up. I'm waiting for the first e-plant to call for a shutdown or what some call "hot idle". I had a very modest hog operation, but $7 corn is one of the reasons it is gone. (almost)

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jrsiajdranch
Veteran Advisor

Re: BS Kraft!

Right now I am feeding wheat mids and oats and no ddg's to my cows there is also no corn in there. I am off a couple of pounds on milk but not enough to justify buying corn.   There is a problem when you can live in Iowa and Wheat is cheaper to frieght in than to buy corn from your neighbor!

 

And your right the crop is deteriorating faxs!  I got another field of corn to opewn up today we will see but I do not hold out hope. 14 kernel rows around just doesn't add up to 200 bushels!

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jrsiajdranch
Veteran Advisor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

roaringtiger and 67 guy I have a question?

 

If those ldp years were so good for endusers why the blankety blank did ethol need all the gov. help to get off the ground?

 

E has beeen around for over 30 years and yet not until W got the mandate thru and Clinton got the subsidy passed did it take off!  Apparently E can't even make it when you guys sold them corn at a loss!

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67guy
Veteran Contributor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

Thats easy.  Big oil kept a lid on ethanol for years.  People didn't care about it when gas was $1 or even $2.  When energy prices started going higher and the outcry for renewable fuels began ethanol was the obvious choice since it was as you noted developed and been around for 30 years.  The mandate like it or not was the government trying to force the gas blenders and the public to do what they thought was the right thing.  Whether you agree with the mandate or not and I'm not sure I totally do, you have to realize that the public would not necessarily do the right thing for the environment or the battle to reduce independence on foreign oil if someone didn't make them do it.  They wouldn't do it on their own because it might cost a few cents more.  That is why ethanol was chosen and why you have a mandate.  I'm not saying it has worked out like the government planned but those are the reasons I see for it.  I'm just wondering what you think we would be doing with all of this corn if the ethanol thing hadn't taken off?  The plant breeders were going to keep breeding higher yielding corn and farmers were going to keep planting it.  I guess we would be looking at 4 or 5 billion bushel carryouts?  I'm also guessing dollars spent on farm subsidies would be at an all time high.  Oh and the livestock guy would be feeding a lot of my $1.50 corn.

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jrsiajdranch
Veteran Advisor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

67 good answer parts I agree with parts I don't I gotta go chop some corn I'll chat later maybe tonight?

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NDf
Senior Contributor

Re: equilibrium in grains does not exist.......boom or bust.....always has, always will be.......

JR. Well someone must be planning on feeding corn if your going out to chop.

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