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timetippingpt
Honored Advisor

Re: I just can't believe we are nearing a bottom

Vince...at some point...and likely sooner than you expect...the market has discounted the crop size on the futures. Just as at the top, basis will be the game that inflicts the real pain on those who are at its mercy (normally the under-capitalized or under-informed).

 

From our small corner of the world, the corn market has reached its price objectives that were defined by its lows in 2005 and highs in 2012. If it finds a way to go below 3.20 , so what. Maybe it goes to 2.90, big whop...this bear market is already one of the worst in history in terms of time and price declines. Our view would be it is more appropriate to get less bearish and less sure of ourselves, not moreso as you have. Remember every pig gets slaughtered, not just a few, every one of them on the truck.

 

Every farmer should already have a plan for where every bushel is going. And, react quickly if under-estimated. For example, our first 200 acres of beans produced a yield that is 110% of the fields highest ever yield in the past (not average, highest ever). Beck's only wants us to save 60 for seed, and since we can only store 62 bushels per acre, we immediately shipped the overage to Cargill on a quick ship bid of 25 over. This is 62 cents better than the bid for harvest. The last guy to react to the overage might get even 40 cents less as the basis widens further, or can't even harvest as the elevators can stop taking beans until some are crushed.

 

just thoughts...besides just like 2004 the futures market could easily rally during harvest while cash stays flat to lower.

 

on a side note, some friends in ne-ia in the bad weather areas (15" of rain in June) are reporting early corn yields equal to average, hardly a disaster fwiw. MN is going to have to be really bad to matter.

 

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Re: I just can't believe we are nearing a bottom

The market will bottom when you Vince will least expect it.
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Re: I just can't believe we are nearing a bottom

I have to agree Time. I think bean are bottoming also especially if we get a positive close this week.
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you guys are missing the really good bear market

In the bean market.  Corn isn't done goig lower and if it does go down to 2.90 you missed a 30 to 40 cent move.  Not small peanuts in y neck of the world.  But the beans have a huge decline ahead of it.  The decline is a function of both time (sorry to steal the line) butalso price.  Just like when hogs reached .35 cents in 98, farmers though it was too cheap and no way it keeps going lower.  Well we hit 8 cents.  Beans could have 3 dollars at the most to a dollar at the least of downside in them.  Just like in march when I warned we could see 2 to 3 million more acres in the june report  Just like when I warned we could see an 180 type national yield in the future (all I heard was that it is impossible because the  45 year average is 159, or buck is always wrong, or a rediculous theory about peak corn).  We have a tsunamy of bearish fundementals in the market,  the perfect storm as it where like the 11 and 12 bull market (whick we never have ever had back to backdroughts, so it is a golden bullet for the bulls).  The bears have been lying in wait for their opportunity to take a piece of the bull again and they will not let it loose.  The only reason to get out of a short account is if the moving averages or weekly low closes point to it ending.  Dont try to out smart the market.

 

 

,

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Re: you guys are missing the really good bear market

its easier just to ban him and call him a non farmer/speculator.

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timetippingpt
Honored Advisor

Re: you guys are missing the really good bear market

"Don't outsmart the market". Totally agree, that is why we are still hedged, my only point is that the next 30 cents down in corn is VERY unpredictable, both as to when it happens, and as to IF it happens. The last $3.00 was extremely predictable.

 

Yes, beans will take out the fall lows, but the fall low is pretty unpredictable as to price, but very predictable as to time, Oct 6th to 10th.

So, we will wait and see what develops.

 

As uncertainty grows, it is wise to admit it and plan accordingly. For example, with nearby corn at 3.20, keeping the 2015 hedged might be a pretty bad idea. Wait for a reason to exit of course, but having an open mind is more critical now than it has been since Sept 2012.

 

If you review some of the stuff we have talked about at our meetings (like how the unlimited spec money flows force all the price change in a very short period of time and then the market moves sideways for weeks or months) there is reason for corn futures to stabilize (not corn cash which is pretty much unrelated these days). Note that stabilizing is a stranglehold for the unprepared farmer, and that is what should be expected. The statistics of normal at work once again. This should be a grind that does NOT reward the store and forget it crowd. That is what normally happens.

 

jmo and not saying the great buck is wrong.

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Re: I just can't believe we are nearing a bottom

You must have liked me using the great buck theme๐Ÿผ๐Ÿ˜„
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Re: I just can't believe we are nearing a bottom

It will bottom in dec or jan
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timetippingpt
Honored Advisor

Re: I just can't believe we are nearing a bottom

My work would totally disagree with a Dec or Jan bottom. Thanksgiving, Feb or May is more likely for corn. As I said though, 2015 is just more unpredictable than the recent past. It should be a year to sell rallies and to buy new lows.

 

For MT, yields in Indiana are simply amazing, as most of us expected.

 

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Re: I just can't believe we are nearing a bottom

I am at the disadvantage of not being able to review your peer groups annual meeting report.  If you look at the beans you would notice how a dec or jan low is very symetrical in the chart formation.

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