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roarintiger1
Honored Advisor

Just a few observations.

The ethanol plant in my neighborhood already has a +.30 basis.  I heard yesterday an advertisment on the radio by them to bring your corn to their plant.  This advertising is a first as far as I know.  They really need more corn.  They are trying to be proactive, I guess.

 

Secondly, a local machinery dealer is also advertising on the radio.  Their pitch was come check out their already low, auctionlike prices.   They were saying, get your equipment now from us at auctionlike prices and not wait for the winter auctions.    They are trying to be proactive, I guess.  

 

Also heard yesterday several farmers talking........not one of them is going to buy ANY seed at a higher cost than last year.  They will switch companies before they buy the higher cost seed.  Also, many are going to pull nutrients out of the soil bank and not put any P or K on their acres for this next year.  They are trying to be proactive, I guess.

 

Signs of the times.  

 

Edit............This ethanol plant is Poet- Leipsic, Ohio    and has now moved to a + .32 on their corn bid.  Guardian Energy in Lima, Ohio is now posting a +.35 bid.   These ethanol plants are probably around 30 miles apart.

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4 Replies
crophugger
Senior Contributor

Re: Just a couple of observations.

That was three.

Just finishing up the season here 2nd best crop ever if you got lucky and missed the hail.

Basis has went from about 55 during harvest to 42 under now big crop better basis.

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ECIN
Senior Advisor

Re: Just a couple of observations.

My Observation is - Just before harvest - threw harvest - we were as busy hauling as you could be - I could have had 6 trucks and that would not been enought - yet - as harvest was slowing down - man did it shut off - haven't turned a tire in 3 weeks - will start back Monday hauling beans - Know - As Hugger said - better crop higher basis - well , I would say the better crop has killed corn prices and bins are pretty tight - How do you get corn - they raise the basis to try and shake some lose - My guess is that basis will be good till Mr. Banker comes calling or rent comes due - then it will be second harvest all over and the basis will go down . But thats just me thinking out loud - Smiley Happy

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Jim Meade / Iowa City
Senior Advisor

Re: Just a few observations.

I've seen several corn piles in eastern Iowa flying around the last few days, and haven't even been looking for them.  The corn supply seems to be a local issue.

 

Your comment on machinery prices is interesting.  We're seeing the same lack of movement here.  Do the dealers have to pay tax on the inventory after the first of the year?  Is that a reaston to try to move equiopment early?

 

I'm of two minds on input costs.  On one hand, I'm going to use a sharp pencil, but on the other I dont' want to drop yield so much that I drop income worse.

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ECIN
Senior Advisor

Re: Just a few observations.

Jim - I believe that they have to pay taxes on it - there is a dealer in Rushville that part of there dealership is in town and part is in the county - they move all the equipment to the part in the county becasue the tax rate is lower - But and not sure on this - I think that after some time - the dealership has to pay for the new equipment thats not sold - now that would be a bundel if you had 5 - 6 - 10 new combine not sold - or tractors - planters

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