ND-SD basis

[gil.gullickson]

All,

I'm stepping out of my usual crop production area, but had a question for any farmers in NE South Dakota or SW North Dakota.

Last year, I forward contracted some corn in early May on my family's farm in Northeast South Dakota (near Claremont) and the new crop basis was 67 cents. Yesterday, the basis widened to 90 cents on new crop corn. The basis for new crop soybeans isn't much different than last year--$1/bu now, vs. 95 cents last year, but still wide. The old crop corn basis is $1, and the old crop bean basis is $1.20.

Any rail/transportation issues as to why the basis has widened in that area? I raise some eyebrows when I tell folks down here in central Iowa how wide the basis typically is in that area, but it seems like it's even wider than normal this spring.

Thanks,

Gil Gullickson

Crops Technology Editor

[Palouser]

I'm guessing that corn is mainly headed for export from the PNW. Basis there is often 1.50. Curiously, at the moment, the market doesn't show a price out here for corn. Not sure why. I know it's being bought and sold and shipped.

[farmerguy89]

Higher us dollar

[mvp farms]

oil coal oil oil oil coal oil grain

Thats the priority of any train that comes within 60 miles of ND.

[ag-?]

What were hearing here in Northern ND is that getting rail for grain is nearly going to be impossible here in ND. Railroad is going to be shipping oil and its way more profitablle than grain. The basis on grain now is more than double from last year and may even worsen yet to get freight. I thnik supply of wheat may become very tight without market responding to pay for higher freight bills to get grain commodities to the markets. Canada is already experiencing this problem and i believe the upper midwest is going to see this problem too. The soulution is to build more pipelines but political will and politics has stalled this for last 4 years and were seeing repercussions of this now. The US may have commodities to export but we will be unable to get them to ports or users that need them were becoming 2nd world country because we have not invested infrastructure to move goods and services around in this country.

[mvp farms]

Well in our area if it gets bad enough it's only 4 hours to Duluth, I'm sure a few hundred extra trucks on HWY 2 will get somebodys attention!

[gil.gullickson]

All,

Thanks to all of your for your responses. I was just thinking the basis sure is wider than it used to be. Ouch. Sounds like this railroad/oil shipping thing isn't going to turn around anytime soon. I talked with a Canadian ag journalist at a meeting a few weeks ago and he remarked, too, about that Canadian farmers are having a tough time shipping by rail.

GIl 

[ag-?]

It wouldn't just be a few hundred extra trucks on the road. Were talking thousands of trucks to move crop if railroads are not accessible. One unit of grain cars would be about 500 hundred trucks and think how many units are beeing shipped each month from our evelavators. Also it shuts us off from west coast markets here so we become dependent on rail or barge to move our grain from minnesota to ports to ship from. This is going to be big political issue come this fall for midwestern states mark my word on this,  The problem is that even if we start building pipelines and extra rail were years away from it coming on line and oil production is still ramping up so this problem isn't going away. We should have had our first pipelines being finished now like Keystone but we haven't even begun yet and were into another delay waiting again for the president to approve this pipeline. Even the Senators and Congressmen from both sides of aisle have come to agreement we need to build these pipelines. I am afraid were going to have major rail accident where one these oil train blows up in some city killing lots of people before we get this across to politicians and public.

[Palouser]

" .... because we have not invested infrastructure to move goods and services around in this country."

Who's 'we'?

[k-289]

In the 80's the political experts where saying the rail was going the way of the covered wagon --- maybe some B-52's in Minot could move it ?