cancel
Showing results for 
Search instead for 
Did you mean: 
Honored Advisor

Ethanol and increased CRP ground

I find it very interesting and frustrating that with the Administration announcing that it now favors E-15 and yet another announcement of an additional 5 million acres opened up to CRP, terrible crops in Argentina, and a blizzard in the upper midwest in mid April,   the traders are very complacent with the markets today........  I know.......Don't worry, be happy.

 

https://www.youtube.com/watch?v=d-diB65scQU

0 Kudos
15 Replies
Honored Advisor

Re: Ethanol and increased CRP ground

yes ---- I wondered if the E-15 issue was going to get ignored...... womeone was asking for that not too long ago here at the "think tank".

 

 

We are building a base for a pretty strong market.

0 Kudos
Veteran Advisor

Re: Ethanol and increased CRP ground

Traders have become convinced that farmers can plant the corp in 10 days.  They'll worry when the 10 days is up.

0 Kudos
Veteran Advisor

Re: Ethanol and increased CRP ground

I would not count on CRP having a whole lot of affect. Lower rental rates and less cost share make it much less attractive. Plus targeting marginal land and buffers,etc will lower production less than enrolling whole fields would
0 Kudos
dhschoch
Senior Reader

Re: Ethanol and increased CRP ground

Well said; you hit all the right factors re CRP effect.

0 Kudos
Honored Advisor

Re: Ethanol and increased CRP ground

CRP appears to be a political handout to the states that are important to elections.  Lots of new CRP acres at high per acre prices the last few years in Iowa.

Not sure you can get a crp contract in Kansas.  Actually many CRP contracts being ended in kansas where the acres are cheaper.  Since no-til, irrigation, chem fallow--- wind erosion doesn't seem to be as important as getting the Iowa hillsides back out of cultivation even though it is very expensive. .  And maybe it is government trying to correct a government action.  If they meddle in the economy like the promotion of  expensive "clean" energy to use more corn within Iowa than Iowa can produce, what do we expect?  So...... are they now dealing with that issue by spending more to handle the side effects and hope we will ignore their social engineering of the agriculture economy and in effect handing out cash to reward political support and economic activity that promotes environmental politics ? 

 

Just something to think about.......... and I do think that ethanol is in fact the best thing stumbled onto by the environmental worship revival and our desire not to live through economic difficulty.

0 Kudos
Veteran Advisor

Re: Ethanol and increased CRP ground

Lot's of moving parts...   and unintended consequences

0 Kudos
Advisor

Re: Ethanol and increased CRP ground

It takes another 1.5 billion by of corn to go to all E 15. On crp...there's plenty of bunny huggers who would like another 5 million acres in crp Ànd there's plenty of dirt to do it too,

0 Kudos
Honored Advisor

Re: Ethanol and increased CRP ground

CRP was and still is a bad idea that was implemented.  

 

Taxpayers debt increased for the dubious benefit of a few. 

 

Instrumental in the rape and pillaging of many marginal acres just to get a taxpayer check for many times the real worth of those acres.

 

In some areas it was the decimation of the farming/ranching next generation.

 

It started as a covert way to save a generation of rural banks. It has now been perverted, taken over by a group of college educated citidiots with absolutely no abilities of thinking on their own. 

 

Still rewarding bad behavior/stewardship.

Esteemed Advisor

Re: Ethanol and increased CRP ground

Well, a less emotional point to the contrary, we use CRP quite effectively for drainage stream buffers. Good in just about every way imaginable. So, out of 6000 we have about 45 in CRP all together. Win win for everyone, even the taxpayer imho.

 

To the other point, as an industry, we can plant the entire corn crop in 10 days or less, so it kind of makes sense that the trade knows that doesn't it? Why should it not.

 

Plus corn has rallied about 75 cents in the last 2 months, so some of the planting delay fear is already bid in.

 

Good to notice that the specs bought 500,000 contracts of corn from 1/23 to 3/10. 7 weeks. 2.5Bil bu. Like it or not, the specs have already bought in to delayed planting. Will the commercials have to give in to fear as well? If so, 4.50cz is pretty likely in early May. As usual it comes down to a weather forecast, and will the commercials have to buy on strength because the weather didn't shape up in time (it does about 85% of the time thus selling AFTER when the specs have gotten long is usually a good idea).

0 Kudos