- Agriculture.com Community
- Announcements & Forum Help
- Farm Business
- Young & Beginning Farmers
- Cattle Talk
- Crop Talk
- Hog Talk
- Machinery Talk
- Machinery Marketplace
- Shops, buildings and bins
- Ask the SF Engineman!
- Computers & more
- Precision Agriculture
- People & Rural Life
- Ag Forum
- Women In Ag
- Agriculture.com Blogs
- Your Farm in the Future
- Women in Ag: Lisa Foust Prater
- Women in Ag: Brenda Frketich
- Women in Ag: Anne Miller
- Women in Ag: Jennifer Dewey
- Women in Ag: Talkin' Turkey with Lara Durben
- Women in Ag: Heather Lifsey Barnes
3 weeks ago
Always need to look back and see if you remember what you saw correctly.
And remember, as you cross the line into February, and your still in business for the 2018 year as a producer, if your feeling of stress hasn't vanished, lets look at a few things that should make us feel better but won't ease the pain........ at least not this winter.
Side note look at the price change built into the next 12 months in kcwt.....A harvest surplus is not expected to lower the price...........
The Leader in January,
At the very least we have to say it has broken the $4.40 resistance area with some flair.....
We may still be witnessing the death of wheat as a cash crop in this high priced production world, but this is a pulse that could begin saving wheat from cover crop status.
I was thinking already that wheat has had a nice month with a couple of surges ........ without great export news.....maybe the long term drop in acres and low yields the last three years are approaching a "quiet" concern... It is 6 months after the the harvest supply bump........... and maybe not..... it is still too early to see if there is a trend change..... still a commodity to own. A long way from a commodity to sell..... trend signal will come from basis changes. And sell signals are locked into cash needs unless we see something stronger than weather scares.....
So I am still looking to take profit soon and buy back in the Sept 18 $4.70 range and keep playing the range as it shows itself. Actual Hedging is probably $1.40 north of here (coupled with a 40 cent gain in basis). That is not to say the market is wrong, only to say the production costs are nowhere near the market. Try to find some fun in watching the world markets and don't pretend they are ours because our production costs certainly don't fit that market..... Our only hope is production shortfalls in wheat.
Corn is different story.... We are operating on the edge with useage that needs near record production and exports at only 13% of total demand. 76% of corn demand is made up of two things Ethanol and Feed... Ethanol production increases at a 6 to 10% level annually for the last 5 years and cattle on feed and poultry production in the US have been growing constantly for months, years in the case of cattle.
Add to that production costs that are so high that farms are struggling to stay in production at $3.50 prices where I live and the dakota's are sub $3 for long periods of time. Think about that.....The dakotas,texas and Kansas produce more corn that the carryout at 16% of production. $2.60 corn in the dakota's????? might affect production especially if wheat finds a value. Texas and Ks are producing on depleting water....irrigated acres are droping annually now and texas has trimmed lots of corn acres to cotton last year and this next with 70+ cent/lb. A 50 % reduction in acres in those locations cuts carry in half if production stays at record levels. And if the USDA system is "slow to respond" to production changes, as I think they are, this is a volatile market especially with high production costs.
Looks better than i expected.... that is a pretty solid trend interruption.
Beans. Seem to me to be kind of sluggish-- locked into the struggle either side of $10. But beans held a better value through 2017 harvest than the other two. I was kind of encouraged by the bean chart looking at January.
That is probably the best month of January of the three...... it is too quick of a change to hold to trend status without big news but obviously the SA news/sales pitch....didn't hold into 2018 very far.
Overall since two of the three been going down for three years.......... respectfully,,, its a pretty decent start for 2018.
3 weeks ago
Thanks for the encouraging reminder. I'm going forward with guarded optimism. I will sow in faith and reap what comes. Oh, by the way, Punxsutawney Phil saw his shadow so-six more weeks of Winter.
3 weeks ago
Phil is an "often" misread leading indicator.... This year I am thinking Phils retreat back to hibernation is a drought indicator and a wheat omen...... Coming out of hybernation can be deadly in the face of a 4th month without rain.
suporting document for corn market thoughts:
3 weeks ago
If Phil could come out of his house and predict record yields on the 12th of every month he could live in a much better neighborhood. Play golf in florida..... have job security and retire with great benefits.....never face reelection or correction.
But no Phil is a proud libertarian who fights the weather annually. Faces the potential of being proven wrong every time. Knows without a doubt he can be out of a job at the whim of meteorology, pseudo science, or a press corp of marmot hatred. But he lives and breathes the american soil and weather and an annual chance at weather prediction glory.................
He is agriculture celebrity...... a guest consultant for farmers almanac.... and hybernates in the afternoons just like me.
Lets not taint his life by tying him to the high and mighty USDA.
Vote Groundhog in 2020....
3 weeks ago
I was so glad to hear Phil saw his shadow and therefore 6 more weeks of winter. AZ is having the greatest weather ever in our time here so we will love to have 6 more weeks of this. Then back to IA and a muddy springsmileyvery-happy: