Re: Floor Talk February 14
Bkadds, Corn has acted good IMO, showing solid, steady strength on the board. The friday closes have been decent the last two weeks.
On the cash side the end users are absorbing some of the gain with reduction in basis. I stepped in a month ago and set some basis contracts but made my usual mistake ------ not enough. But I am feeling pretty good about it.
I did some quistioning today, seeing what I can do for April delivery and it is looking like 8-10 cents off basis from a month ago. With the futures gain that is still in the $5 range.
The biggest negative I feel locally is the low cattle numbers which just can't be helped for a while. Somehow I don't think this winter has helped us much there. One customer of ours is just loaded up with corn and it is starting to look like we may market this year without that relationship for the first time in many years. That bothers me.
Cattle Numbers combined with a lot of corn available for now, yet the market acts like it wants to build gradual strength---- overall that's the best news we have had in nearly 12 months for corn.
Beans --89--- We did the same ------- moved them early when the crusher was begging for em. ----- They were profitable and I think a lot of this years crop passed over to the other side early. Couple that with the record exports and you have to wonder just how much there is out there to answer the call from higher prices.
Brazil is going to have a hard time driving down the price of beans by themselves. New crop will have to recognize that eventually.
Acres ------ I am starting to doubt much of a swing to beans, unless we see new crop beans get active. All corn has to do is gather strength in the $4.50-5 range. We are already starting to trim the carryout figure in corn with 29 weeks left in the season as we market the "record" crop.
Short version on the bean side our volume is going to be very low again but the strong usage depends a lot on exports. On the corn side the plus is our strong usage is in the US but we have more carry for cushon..