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Veteran Contributor

China's tricks

It wouldn't surprise me if China leaked out some bogus report that the economy is lagging or they have an over abundance of grain to try drop prices so they can have one last big buy of cheap grain. It seems every time there starts to be a big run up in prices they try something.
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7 Replies
Honored Advisor

Re: China's tricks

They are the 800# Gorilla in the room.

 

If you were them ...what would you do?

 

With their top down orders and bureaucracy, it takes a while for them to realize the facts also.

It is not an open society and there are consequences to falling short of quota.

 

I think we should not get our panties in a wad just because they say one thing as they are doing something else.

 

It is kind of like sitting through a magic show. Just enjoy the show and realize there is smoke, mirrors, and misdirection.

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Veteran Advisor

Re: China's tricks

if you have sold all of your 2011 crop inventory and hedged too much 2012, there is not currently much to enjoy about the show. Otherwise, just sit back and enjoy the ride...the trend is your friend.

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Veteran Advisor

Re: China's tricks

China tricks?????? Who knows.  In a span of a week, my wife and I saw more Bentleys and Rolls Royces in China then I have seen in three months in the US.   In terms of business, we in the US want to make a lot of money quickly. The Chinese don't.  The Chinese want to make a little bit of money ALL of the time.     

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Honored Advisor

Re: China's tricks

If you are out of 2011 crop you must have got a good price last summer for it? If you have sold 2012 lately ...well I hear Wal Mart is hiring

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Veteran Contributor

Re: China's tricks

I had enough priced off the combine at a good price to cover bills as for the rest I am still sitting on,this season I was on the bulls side. I am thinking of selling some though and pricing maybe 20% for fall delivery the prices now are still a profit for my farm.
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Senior Advisor

Re: China's tricks

Anyone who had followed China understands they are quite predictable. Saying they don't intend to buy is a buy signal, but not necessarily an immediate one. They also have/use their complex bureaucracy to send out mixed signals from differnt levels.

 

The one sure thing is that China is going to buy more this year than last.

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Senior Advisor

By the way ...

.... China will never use the excuse that the economy will determine how much food they will buy. That's purely a 'Chicago floor trader' myth that even some of the most notable analysts fall for (still!). Food commodity demand does not correlate to economic trends as a rule.

 

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