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10-02-2010 09:11 AM
Next week's prouction numbre will have something to say about it- I'm as sure that bean prod goes up as I am that corn goes down. Don't know how much.
I shouldn't even say this 'cause I don't want to mess up my own thinking but I do wonder if USDA's urgency in reversing the June stocks number might not have something to do with not wanting to have inadverently sunk the livestock industry with $6 corn (because producton is even smaller than the whisper number)? We'll just put that off to the side.
In outside markets, the risk trade feels like it is getting long in the tooth but once da boyz get it rolling it always goes longer than you'd think. In last year's relief rally the dollar just floated down until one day somebody decided that Dubai was a problem then bang. In stocks it wasn't until Greece appeared to be melting down, even though it had been becoming apparent for a while.
Now Ireland appears to be a bit worse than Greece was at the bottom but nobody seems to care.
Short answer, when a market falls out of a parabolic rise, usually the best you get is a retest of the top, if that.
10-02-2010 06:10 PM
Yeah Ive heard that USDA's numbers may be off due to an early harvest. Livestock guys better take advantage of a limit down day and fill some bins with cheaper corn. I would think there will be quite the acreage battle this spring. My guess is that soybean prices will be falling soon also.
10-02-2010 07:38 PM
There was alot of "off wheat" end of May 1st part of June during wheat harvest.
Price of that was in the high 2's, mostly though in the low 3's.
Bout everyone who feeds anything filled up on feed wheat ( 300 to 400 million bu. would be a close estimate ).
Since sales to feedlots and dairies are basically non reported, the USDA would be none the wiser so to speak until later.
The afore is what actually got ALL grain current for the markets which came after June.
One suprise oncoming is likely sorghum production.
Only approx 7 + million acres of the stuff...but dryland yield reports here so far have been in the 140's to 200's range....alot of 155 to 170 bu milo it seems.
USDA is likely thinking in the 80's, I'm figuring they are at least 25 bu per acre light there....perhaps closer to 50 bu per acre under estimated.
Simply means less corn used in the SW due to more Milo.
Corn should continue the negative correction for another couple days....say paper corn off the limit Monday and close to limit down close again Tuesday.
Basis should get narrow, thus cash corn not the wreck the board might indicate.
Wednesday perhaps the paper corn bottom, with this deal then behind us and hopefully a long slow steady up on thru 011 to follow.
Beans? I always love beans, figure Brasil will raise maybe 65% of a normal crop ( likely only half a crop there though...just to many negative factors...people problems and weather problems both )...thus cash beans to at least the 15's with wheat only a couple $3 behind that by spring 011.
10-02-2010 08:09 PM
We can sell corn off the combine today for $4.08 the fat lady ain't even warming up!
You only have an acerage battle if we need The corn acres in the spring if we don't have the ethol mandate and blenders credit we probably don't ned 90+/- acres so why do we battle for them?
And Black sand farmer I sold a lot of corn over the years that was under 2 dollars. that was cheap 4 dollar corn isn't cheap and infact most guys I know will make real good money here. 3 dollar corn is certainly below cost of production but man up I have produced milk for less than cost of production for 27 months. There are no gaurauntees of a profit and no one and I mean no one cares a bit if you make a profit selling corn we only care if we make a profit using it. and 4 dollar corn probably doesn't get us to a good profit yet.
Sorry to be sounding so harsh but come on guys most of you are complainng about less profit not below profit. One guy on here didn't want to sign a contract for a price which today I'll bet he would like to have! Chew me up guys but this isn't the end of the world.JR
10-02-2010 09:44 PM
Where do you get the production numbers for sorghum? Your estimate seems quite high. In Kansas, the USDA number might be low, but not anywhere near 140-170.
10-03-2010 07:13 AM - edited 10-03-2010 07:15 AM
good call jr. i was feeling a little bummed about having 2/3 of my corn priced and fair portion of that in the upper 3's. when i could price next july in the low to mid 4's was also very tempting. you won't go broke making a profit.
10-03-2010 08:13 AM
FAT LADY won't leave the stage here. She keeps rubbing in our bad yields. And there are areas worst than ours. Humble pie year here. Read about all the good bean yields, but parts of IA are producing beans with yields off 20-30 bushels less than last year. Sounds like many areas are above average, so not a market factor...just a personal pocketbook factor. Corn yields, especially corn on corn....a 50% reduction from last year...corn on beans only down 75%. All of the areas with good/great yields don't have to worry about the fat lady.
It was our turn, so many great years in a row...no complaints...but I will gladly let someone else have their turn next year. Would be a poor year to be in the grain elevator business in this area...no volume..no drying, but no wait for the farmer hauling to town. A lot of storage was built on farms around here that will not get filled.