From the parlor pit 2-21 (pickin on Loren)
WELL WELL! I opened up the new edition of Successful farming at my favorite porcelain reading chair and found the editorial from Loren very interesting.He was talking about food choices among other things and here is an interesting pull quote
"we have never let food costs rise faster than our incomes" He says ( quoting Harry Balzer). With purchasing power generally falling over the past decade , consumers have held food spending in check.
The opinion piece also mentions Yogurt as the new up and coming shining star of dairy product prices. I think he is right. I looked back and found this article from Reuters which mentions Danon's outlook.
I think that dairy is gonna have to wake up to our changing consumer base that is gonna include the packaging of conveniences as well as nutrition. Also we must maintain our commitment to the export market. After 09 many in the industry are very gun shy about using the export market as part of their business scheme. I think our embracing of that market is key to the future profitability of the industry.
Now to the market. Last Fri. we saw some big sell offs in the futures while the cash market held steady. Don't panic the reasons for the sell of where actually very good.
1. CME group raised the margin requirements on the contracts which causes folks who didn't want to be exposed to the higher costs of the contracts to get out of them.
2. Today the CME.CBOT is closed due to the holiday so many who were just speculating felt the prudent thing to do was to get to the sidelines till tomorrow.
Those two factors actually tell me that we should have been lower so there is a very strong base under this market.
As to the pickin on Loren part well I hope cheese on those hamburgs cause I feel very put out that he prefers beef to Yogurt! HE HE Thanks Loren for a good article.
BE safe folks and try to stay dry it's kinda wet right now! JR