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Honored Advisor

Re: Floor Talk June 6

The East coast is boating it in because they can't source it in quanity anywhere else. The basis in Va was OVER a $ higher than CBOT and they still have to boat it in. If "boat" corn is so cheap why is the basis one $+ higher there?

 

It is only 62 cents here. Less as you go north.

 

As a side note pay attn to which month basis is figured on. Some are still on July some are on Sept and a few are going to switch to Dec.    Cargill/Eddyville switched to U and therefore the basis went $1.40+ just stay even with the price it takes to get corn.

 

Going to be interseting to see what the BTO from a hundred miles away does with the next swamp south of mine... he put nh3 on last fall. (stupid thing to do on a Southern Podunk Country bottom farm) Weeds are about 15 inches tall with a solid stand. I wonder how many rows will still be on his 36 row planter if it even shows up. Last time he planted corn here (late that year too) he had ripped one off the end and was just planting with 35 rows.

 

Visited with a local BTO that said he found a mud hole the other night and now has his 24 row planter totally plugged up. Said one end of the planter went "in" level with the ground.

This nieghbor has relation that farms in North central Iowa and says they only have 1/3 to 1/2 of their corn planted depending on which one.    

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Veteran Advisor

Re: Floor Talk June 6

gregs3821958,

 

Greg, thanks for coming into the light and out from under the shadows. It's great to hear from you. Thanks for offering your perspective. The more the merrier. So, you don't think the price of corn on the export market has anything to do with our weak demand? Instead, you think it's all (or mostly) about dwindling supplies?

 

Thanks,

 

Mike

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Veteran Advisor

Re: Floor Talk June 6

I know you didn't ask me Mike, but my 2 cents re: exports/supply, price, etc......just going on todays trade rxn to the - way below expectations #'s------tried to sell it, but couldn't keep it down with buyers stepping in just 4 cents below overnight trade....seems to be an argument for not enough supply to export.

 

thanks

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Veteran Contributor

Re: Floor Talk June 6

I think there is some degree of  correlation between low supply and low exports. Sometimes, like now, low exports are translated incorrectly into weak demand. Dwindling supplies create low exports, not weak demand.  Demand is still strong. (a la import activites, basis levels, etc)

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Veteran Advisor

Re: Floor Talk June 6

perhaps what we're looking for here answer-wise is - yes the raccoons are using the bins as a playground. It has nothing to do with new crop price, because demand is NOW, not in Dec----- rather, it has EVERYTHING to do with basis and the inverted board from cash out to Dec.

 

To simplify it, take whether US is exporting billions of bu or zero bu out of the equation....It's all about the small supply/demand #---it is this # alone which causes the strong basis and inversion.

 

as an example, supply could be 10 billion, demand 100 billion----more exports would occur.

or                         supply could be 2 widgets, demand 11 widgets----little to no exports/sales occur----but in both cases you have similar price and strong inversion/basis, b/c even in the latter simplified example the 2 strongest or (most in need) buyers will have to pay up in order to out-compete the 9 others in need of the 2 available widgets.  

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Senior Contributor

Re: Floor Talk June 6

Today, Conab released the grain crop forecast.

 

Here it is:

 

Soybean harvest will be nearly 81.2 million tons, while the second corn will have a yield of 43.62 million tons – up from 39.1 million tons last year. The summer corn crop is estimated at 34.8 million tons. The Brazilian rice output was 11.92 million tons.

 

More details at agrosouth-news.com

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