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Honored Advisor

Re: Marketeye, Marketeye, Marketeye

It is just easier to believe usda's numbers than to remember 2012 when those 12something numbers never appeared, when the reality was obvious......

And three years later we are still feeding at the government trough even though the drought denial never got explained .

 

Please try to remember, the cash markets actually realized the diseaster without USDA's telling it to......

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Veteran Advisor

Re: Marketeye, Marketeye, Marketeye

Sw363535, I agree. Basis in my area has firmed in the face of bearish reports, even with some of the local crop "here" in good shape. I think what bothers me the most is the USDA's soybean numbers. USDA has been wrong on the soybean yield for 2 years now. I know this when we seen +$2.00 bids last September and +.50 to +$1.50 already this year. This report will shut off already slow grain movement on whats left from last year, and personally I dont think there is much left from last year. This report was garbage, and anybody that drives across the cornbelt this year will know this crop as a whole will struggle to average 160 on corn and 44 on beans. The combines and basis will tell the story fairly soon I suppose.

Advisor

Re: Marketeye, Marketeye, Marketeye

time, you've surprised me with your statements about the report. You rarely get caught up in this crop-size peeing match. If iowa has to carry this national soy crop, i'd better get another guy to help haul it all.

 

I think there was some confusion here with references to "ray". The line between ray grabinski and ray jenkins became alittle blurry.

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Esteemed Advisor

Re: Marketeye, Marketeye, Marketeye

Ida...fair point taken...but this thing just defies rational thought from a statistical viewpoint, especially in the beans. I even read "USDA crop models for July" caused them to raise the estimate over the field survey number...what...that can not be right can it? Why do a field survey if that is the case?

 

I did a complete thread on this on the site and will give you the 2 cent summary, there is very little bearish in this report if you read it without reading all the headlines. Demand was already reduced for beans for no apparent reason other than "fear" of reduced china buying. Corn demand is extremely strong. Wheat supplies dwindled a bunch. If you just use a rational 42 bu bean yield, even on their acres, carryout is unchanged. Corn carryout increase is within the monthly amount it vaires on the S&D reports. And remember it is as of August 1st, no ones crop has improved since then, some have declined.

 

Like I said, I'm an idiot, we sold puts too early in the day, but much like the calls we sold June 30th, feeling ok with our position, just don't like being wrong is all.

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Senior Contributor

Re: Marketeye, Marketeye, Marketeye

Time?
You sold puts. Bullish strategy. How far out in time and money. Just curious. Will you hold till when??
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Frequent Contributor

Re: Marketeye, Marketeye, Marketeye

Time, this isn't intended to be snarky, I'm just curious.  You seem to be thinking a little lower on crop prospects than you were in some discussion 2-3 weeks ago, saying that flooding and such was already accounted for in the "average".  Have you just seen more of the crop now, or is it more analyisis of the big picture?  I've covered a lot of miles in IA/MN/WI/IL but have not yet hit the really tough areas of the eastern belt.  Trying really hard to avoid backyarditis, rather discouraging looking out the kitchen window here.

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Advisor

Re: Marketeye, Marketeye, Marketeye

if you pay your wagers when is my steak dinner and free bottle of booze from last year

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Advisor

Re: Marketeye, Marketeye, Marketeye

Ken I cant get onto your web page what gives.

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Senior Advisor

Re: Marketeye, Marketeye, Marketeye

bucky, I openingly told you to tell me who and where to make the check out to.

 

and I also told you that if you were not comfortable doing that openingly you could PM.  and dont tell me you dont know how to PM, cause you have sent me one or two in the past.

 

you never responded or acted on it.

 

kind of hard to settle up with someone when they don't give you any info.

 

so that one is all on you buddy.

 

I made an attempt to settle up and you ignored it

 

 

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Esteemed Advisor

Re: Marketeye, Marketeye, Marketeye

Vince, the website is back up and working for everyone as far as we know. I got your text and have asked the tech guru if there is something causing a glitch. Try closing the brouser and just typing in the address: www.rulonenterprises.com. Google searches don't seem to be working correctly.

 

On the puts, I way under-estimated how outlandish of orders we should have entered. So, we sold the puts too soon and thus might only get out of this breakeven.

 

Short CU 380 puts @ .08, so showing -.10 at this point, expire 8/21

Short SX shortdated 940 puts @ .12, so -.15 last night, expire 8/21.

 

Probably hold till expiration and might take the long position, just have to see how it plays out.

 

Short a lot more wheat puts than corn/soy for what its worth. WU @ .14 earlier and now .24 doubled down. Those were underwater by about .18 last night, but getting most of it back today. Some long-term positions put on in June and later July are showing red as well of course.

 

Maybe more importantly, we booked bean meal yesterday some before and some after the collapse. Got it booked BEFORE they increased their basis. Basis for meal and corn around here increased about as much as the board went down. Cash corn actually was close to unchanged. Always a good feeling. Our fear is that meal basis by next summer in the eastern belt could be 50 to 65 a ton over the board, so cash contracting the meal might be more important than the price.

 

Got to remember we sold calls on and after the June 30 report, so this is their money basically. They tend to try and take it back from me most of the time! :-)

 

We also have nothing hedged for 2015 or 2016 which is quite a difference from where we have been the last 3 years, so I am feeling quite exposed. Smiley Frustrated

 

On the positive side we have been excessively hedged the red meat for a few months, and took about 15 points out of the bonds since the high. For the year we are in great shape, just not yesterday. Like I said, I am an idiot on occasion.

 

Ultimately, I just don't see any reason to be hedged for the next 5 months. This could easily be wrong and no one else should care what I think. It is just that from a timing perspective, things could easily bounce. If they don't, well, been wrong before and will be again. You can't just take one thought, at one moment in time, and expect it to mean anything. It takes a plan for the year, implemented for an entire year, in other words, a lot of work, to really prosper. At least that has been my experience.

 

The bean number in this report is just ridiculous statistically, as was the corn but less so. Ridiculous happens so maybe I am wrong.

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