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Contributor

Jan. 12th Open

I am thinking there will be a lot of guys around in the same position as myself. Carried a most of 2010 beans and corn into 2011 for tax reasons and now have some serious decisions to make. Have an uneasy feeling about the Jan. 12 th report. The majority of commodity experts appear to be bullish on this report. Do you think a lot of this bullishness has already been built in to the market and anything less than a dramatic drop in total numbers will send the market down following the report. I think we may see the market gap lower to shake a few of us loose then once a lot of the crop is out of the producers hands the market will resume it's upward trend. Possibly with this market driven more by fundamentals rather than speculation there is the hope that the USDA #s will come in lower and the market will respond and move higher. Feel free to chime in on what you see happening following the report.
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Senior Contributor

Re: Jan. 12th Open

As far as tax purposes, you could`ve sold in Nov or Dec and the elevator would hold the check til now in Jan. It seems corn has found a home, elevators with 2 big pads for outside storeage are either cleaned up or have one tiny pile, quite a few didn`t even pile since the "big wave" didn`t show up. Corn coming out of the field at 13% as last fall is very storable, if the price would break too much it would be hard to imagine a lot of panic selling.

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Veteran Contributor

Re: Jan. 12th Open

I don't trust the report either and will be safely sold or priced before the report with only 20% left to play with. If I'm wrong, I would like to be wrong like this every year as these are lofty prices. Alot of smart people are trying to figure out how to get along with LESS corn and beans. The battle for acres could mean one crop may have to be higher than anothern crop that is falling in price.

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Senior Contributor

Re: Jan. 12th Open

Considering how we're trading right now, I wouldn't be too surprised to get a similar report and price action that we got with the November report.  For the last month, we've added a buck to the corn market.  Just like the November report, we've made some very nice gains going into the report.  The November report came out bullish, but the price reaction was anything but.  We traded higher for about an hour or two only to score a key reversal and then proceed to fall about a buck.  Last year, we were flying high heading into the January report.  We didn't get the bullish report we were looking for, so we spent the next several months grinding lower and lower until the June 30th report.  If I had a lot of unpriced grain and was worried about this report but wanted upside, I'd go buy a serial month put option.  A February serial month $6.00 put costs around 14-15 cents.  If the report is bullish and prices take off, it would still be money well spent.  You could sell the grain and buy a call, but the scales are definitely tipped to the upside making the calls more expensive.  The charts are telling me that we could see $6.85-$7.00 corn futures.  The same 14-15 cents for a call will only purchase around a $6.65-$6.70 call.  The risk to reward favors holding the cash corn and buying the serial month puts over selling the cash and buying calls.       

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Senior Contributor

Re: Jan. 12th Open

You never go broke taking a profit.

 

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Senior Contributor

Re: Jan. 12th Open

I gave up this morning before the open and sold 1/3 of my bin stored '10 corn. $6.06/bu., and it is 13% moisture and very storable, but,  I havn't forgot how I got burned last year after that report came out. Now I've Got lots of hauling to do this week. If the price comes back up towards the end of the week, I will do it again. I cannot remember when a legal 930 bu semi load of corn was worth $5,500.00. I can remember clearly many semi loads bringing at best $2,000 for several years..

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Advisor

Re: Jan. 12th Open

At the top of my "to do" list this morning...was a reminder to call the co-op and sell the beans I have on DP. Yep..you guessed it...I got wrapped up spreading some potash..and forgot to call....the list is still laying here laughing at me...LOL
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Contributor

Re: Jan. 12th Open

Yikes, down 8 yesterday, 12 today. Looks like the market is testing the nerves ahead of the report. Nothing really bearish is driving this which leads me to believe that the buyers will be back ahead of the report. The storage bill is all paid up so hopefully don't have to wait till the June report for the truth to come out. $6 a bushel would be nice but our basis is 75 under so that might be a stretch.
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