Keep in mind that ever increasing corn production is being met by ever increasing demand. As Illustrated here.
And I still think that negative basis is being created by the need to sell the crop much faster than it is being used increasing storage and ownership by end users for future usage needs. negative basis forces the producer to sholder storage costs.
With better corn prices and profits, the producers are able and willing to hold ownership and store production until it is needed.
This data does not show increasing world supply, but a relatively equal increase in demand increase as production claims increase.
elcheapo,
I am just reading the reports and the consumption figures go up at nearly the same rate as the production......
for example a record corn crop in 2010 would be way short of demand in 2016.
The folks who buy the product( and the press that lives off their advertising) just do a much better job of spinning the data than producers do. Storing grain on the ground has been common since the 1950's when it was at the end of the field instead of at the elevators in the region of the ethanol plants. My dad used to truck with a friend in the winter, milo from ground piles to poultry markets east during the winter. From the same area where some market spinner reports ground piles of "crushing" volumes.... it's silly.... forgivable though because many in the industry of reporting on the industry don't know much about the industry or its history.
Humans are lazy.... especially mentally... we allow the narrator to define the picture painted and fail to see other issues involved. For instance---- The delapidated condition of grain storage. Most of the grain storage in kansas was built in the WW2 time frame and is now unusable.... that is 70 years of aging and some private rebuilding, but nothing to the size needed considering the increases in production since 1950. We have a storage problem.... One would think that the basis would fix that but your not going to here that question from the market spinners.
Consider the big expansion in global trade of all products.... 40 years ago we would not have considered international trade of feed or feed ingredients like corn gluten in the volumes we see today. Isn't that just corn exports that are not reported in the usda monthly data?
Along with US ethanol which is in the data... the production and demand continues to grow...
Looking for other ways that grain leaves the US.
And lets look at the real meat increase world wide....
This is not corn being unloaded from the US it is corn gluten meal for feed ingredients.
Even occasionally advertised as non GMO after it leaves the US...
In the slight of hand that is the reporting and spinning of USDA reports does anyone at SF or anywhere else growth of the demand side of the report??
Cheapo answer these
Is the futures market a tool for price discovery or a tool for price fixing?
Do those who are in the position of Oversight and Reporting provide a public service?
Or a price control service?
Or is their public service to the US or the World trade?
Please reconsider the Corn chart presented earlier in this thread.... We had 120 days use of corn on hand in 1998-9.
We have much less now and are producing more.......much more.... The graphic above looked like this.... and says demand was going up 50% faster than production...in years when prices were high.
How many times in that time period have you been lectured on loosing demand .... (always consider the source)
Most of the population repeats what they are told to say.... without testing it or thinking it through.
I know ,,,,, if you think too much it may lead to that "conspiracy label" disease. But what happens to farmers who do not question and adapt........?
Same goes for the rest of the public ? The populations of the world that work and think will adapt?
Because what happens to governments( the voters) who do adapt to new circumstances? Or question what they are told?
