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Senior Advisor

Grain trends

This is from the FAO site and is pretty general but it's the kind of general trends I like to use as a foundation for other information. OK, quickly sum up in your mind the trends as you understand them to be - for whatever reason. Now look at the information and see if they are the same or similar. First, total world cereal production, utilization and end of year inventory.

 

Total cereal.jpg

 

Next is the global wheat tables.

 

wheat_balance_e.jpg

 

And then the course grains - which I assume includes corn, barley, oats (?), etc.

 

cg_balance_e.jpg

 

So, what particular things did you notice?

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9 Replies
Senior Contributor

Re: Grain trends

use rises over time, persistently.

production was slack for a yr or 2, now is booming.

fitting ES was lower for a couple of yrs, now booming higher,

in line with increasing production.

 

 

what do you see ?

 

BIG picture is the "new" era of sky high prices is over, there was no new era.

Now its back to marksts searching for the buyer of the maginal unneeded production.

 

Look t aa wheat chart.

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Frequent Contributor

Re: Grain trends

Huge production year. From a historical trend perspective 2heat stocks-to-use is substantially more bullish than corn stocks-to-use. World consumption is also surprisingly strong... Still hoping low prices will cure low prices...

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Veteran Advisor

Re: Grain trends

assuming the graph depicts total stocks, that the yearly production and utilization trends are STEEPER than the stocks up-trend.

 

as we continue to move forward in time, Cereal security (quantitatively) depends more on future production.

 

therefore, long term, this is bullish price b/c as the prod-util curve continues to diverge from stocks line, each yearly production becomes quantitatively more significant.

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Senior Contributor

Re: Grain trends

Eventually someone is going to bed hungry
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Honored Advisor

Re: Grain trends

thanks

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Honored Advisor

Re: Grain trends

If we grow it

 

They can use it.

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Senior Contributor

Re: Grain trends

    There are fringe acres around the country that act  like a governor on a gasoline engine (grain prices.) When grain price meets or exceeds the price of a specialty commodities,more grains go in.When the specialties go higher,the grains leave,or when the grains get low they also leave.These fringe acres in the world of grains production are not a lot but do eventually help with the low price curing low price aspect,

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Senior Advisor

Re: Grain trends

You're right, the crop never goes to waste. However the excess can depress prices for a time and we may well experience that very thing.

 

 

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Senior Contributor

Re: Grain trends

    I"m just saying in the fringe world,the healing process is already under way as far as wheat production goes!

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