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BA Deere
Senior Contributor

How Times have Changed

I`m not getting used to the fact of a corn farmer being net short in the corn market. To the point he would nearly resort to fisticuffs at the mention and reality of the corn price going up. Weirder still is a corn farmer being happy as a lark when the product he grows, goes down in price. In the good ole days if grain rallied and livestock went down, farmers didn`t care. They raised the corn that they fed and had extra to sell. As long as one of the 4 commodities of corn,beans,hogs and cattle were up, farmers were happy. Farmers used to be tight lipped about a "good crop", because of humility and the fear of jinxing it. Oh yeah, Dairy prices were always good! Is the current structure of the livestock industry really a good thing? I have one or two doubts.   

3 Replies
Red Steele
Senior Contributor

Re: How Times have Changed

Yeah, I got greedy a few years ago , right before the big runnup in corn prices, and aggressively hedged out three years of corn at not much more than $3 a bushel. So I was hoping for lower prices while I paid almost half a million out in margin calls. The best thing for me was when the market finally started to drop, and I was finally able to get all my margin money back, and even a few extra shekels, while converting those future shorts to actual cash contracts.


Now , when the loan officer I borrowed most of that money from, wants me to hedge crops (short them on the board) I tell him that it goes against my optimistic nature to want prices to RISE not fall, and it really does not suit my character.


The Four dollar plus prices of the last couple of years look like manna from heaven to me after those years.


Luckily I got good prices for my soybeans every year.

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Re: How Times have Changed

Today I was swapping out some office furniture and came across a bean sales ticket from 1970 that had fallen down in the bottom a filing cabinet.


Price for beans was $2.30/bu.


In 1973 one grower thought he had really 'stuck it to my father-in-law' and sold him some beans early for a little over $3.00. He felt physical (or fiscal?) pain when he was delivering them at harvest and they were paying over $7.00 in town.


Yep, things change.



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Senior Contributor

Re: How Times have Changed

Would you be surprised to learn that $2.30 beans in 1970 are worth $12.97 today adjusted for inflation using a CPI calculator? $7.00 beans in 1973 would be worth 34.50 today using the CPI.

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