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Clayseia
Frequent Contributor

Re: Does anyone regret welding the bin doors shut?

Ray's operation at Eddyville is still, and has all along, posted what I would consider to be "pretty good" basis bids for following an exceptional crop within a hundred mile radius which struggled to find enough containers.

 

Time, have you actually looked at Ray's bid structure for the next 6-9-50 weeks?  I don't see much highway robbery in there.  Also, have you actually ever seen a yield monitor after weather conditions that just happened (still happening) to a big chunk of IN?

 

Disclaimer, I've seen lots of NIA/MN which are definitely above average, just went to Oshkosh and WI looks super, and I took a trek through parts of central/western IL which are not fabulous but still have pretty solid potential.

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timetippingpt
Honored Advisor

Re: Does anyone regret welding the bin doors shut?

Clay...Ray is an old friend I was just hasseling a little, no offense intended.

 

Yes, we see those yield monitors EVERY YEAR on some fields in Indiana. We have had flood damage 3 of the last 4 years. IT IS IN THE AVERAGE for us. Smiley Frustrated

 

Yes, this is worse than normal for about 25% of the state. Some of IN looks fantastic. Thus, if I do some math on the IN yield, it is probably 5 bu under average with maybe 2% fewer harvested acres. Which will not pull down the natioanl average at all.

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sw363535
Honored Advisor

Re: Does anyone regret welding the bin doors shut?

Don,

 

"Wronger than most"    that I doubt.......

 

but welding bins..... lets put it this way,   long term.... It is the American way..... To dream of things we can't afford...

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OKdon
Senior Contributor

Re: Does anyone regret welding the bin doors shut?

SW Just an observation. When one is younger and loaded with debt, One tends to plan sales to match future financial obligations. The land contract is due in june and I need cash for that and I need cash for operating etc and so it goes. After the debt is eliminated and you self finance your operation, you tend to get sloppy with sales.  I don't need the money so why would I be in a hurry to sell.  Maybe MT is right and our crop is going to hell in a handbasket. I really don't know what price i want, I just know I want more regardless what the market is offering.

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BA Deere
Honored Advisor

Re: Does anyone regret welding the bin doors shut?

Aren`t some saying that this year is similar to `93?   Here`s `93 and CZ5 price histories

 

http://classic.tradingcharts.com/historical/CN/1993/C/linewchart.html 

 

http://www.barchart.com/charts/futures/ZCZ15 

 

 

So in about a month we should expect a rally through harvest he says hopefully

 

 

Around here most were on the rally of a couple weeks ago like a 3-legged dog on a cat.  But there are always some with deep pockets that have 3 years of corn stored, I think mostly because of income tax reasons. 

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gurly3801539
Advisor

Re: Does anyone regret welding the bin doors shut?

I don't weld the doors shut, I just don't always keep them greased.  This last rally did make me get the oil can out, even if it wasn't as much as I think I want.

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Clayseia
Frequent Contributor

Re: Does anyone regret welding the bin doors shut?

Ken, I greatly appreciate your analysis, both markets and agronomics.  I was referring not so much to flooding, as to corn that actually has a stand but has endured 40-60 days of saturation and stagnation.  Before 2010, I wouldn't have imagined that stuff could be hurt so badly by water.  I have made several road trips this summer looking at good corn in IA/MN/WI/IL but have not gotten into the really damaged areas of the eastern belt yet, so I hesitate to comment too much on conditons hundreds of miles away at the moment. 

 

I'm open to different scenarios at this point.  One is that lots of people have just never seen these conditions and are crying wolf about how bad it is.  Watching the repeated storms on radar and seeing aerial pics makes me only question the actual extent of acreage impacted by that, not the severity of damage in a particular location.  Another possible scenario is that it's shockingly bad on a widespread basis.  I don't know about that either, some soils out there are probably more forgiving than ours.  

 

My perspective is from a crop district which yielded 10% more in the drought of 2012 than the monsoon of 2010.  (And would have been worse than that, had not thousands of acres been Prevented Plant instead of planted to 70 bpa corn.)  I'd seen corn shrivel to nothing from drought, and I'd seen widespread flooding, but I'd never seen corn plants be unable to produce when watered much more than adequately.  Tile, fungicide, sidedressing, flying on urea- none of that sort of thing mattered much.  It was all junk.

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sw363535
Honored Advisor

Re: Does anyone regret welding the bin doors shut?

Don,  

 

Two great descriptions of marketing, good post...

 

The "when your younger" senario,,,,  Is the comfort zone for a farm IMO.  With an accounting background, I tend to see the farm as a business entity with a life of it's own that may last a few years or many decades, depending on ownerships mental "engagement".

In that case there is always an expansion, buyout,  or diversification, or(in our region) a hard few years, etc etc.  They need financing, and so the process you describe goes on   and on   and on.......

But I enjoyed your last comment,  It's always maybe not enough...   I always think about your statement when a marketing guru hammers home the idea that you should sell NOW, because the price is above what your break even was......Without any regard for what your break even will be.....

 

 

The "after the debt is eliminated" marketing,

Debt is just one of the reasons for managing cash flow.... And once a business starts depreciating out it's assets, the business is terminal. And at that point your right the reference points like cost of production get a little meaningless....   anyway I have noticed over the years that in the "retirement" phase of a business, it is interesting to observe where the owners comfort level is in regards to what assets he likes to own.....  Farmers are often more comfortable with a stored commodity than they are bank accounts...  I have even seen a couple who were able to get an elevator to store their priced grain indefinitely and get paid interest on the value of the commodity....  Comfort level       And others want something they've not had much of over the years,,, cash in the bank.

 

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