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kraft-t
Senior Advisor

Now that corn prices are below $ 4.50

I'm waiting for some livestock guys to start recommending 15 to 20% ethanol mixtures.

17 Replies
c-x-1
Veteran Advisor

Re: Now that corn prices are below $ 4.50

1 things for sure - the ETOH guys are BANKING IT right now.

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bruce MN
Advisor

Re: Now that corn prices are below $ 4.50

Nonetheless there remains a rather expansive ebterprise commited to attempting a massive 2014 domestic corn crop. Probably been enough taxation managemebt and credit floating scraps left to assure it goes in to the ground extremely well nourished. It's eerily got a "double down" aura surrounding it. On the "men from the boys" front, I'm mot so sure that the men aren't a bit subconciously nervous. The boys don't know and haven't experienced enough to be
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hardnox604008
Advisor

Re: Now that corn prices are below $ 4.50

May be a long two years until the Iowa Caucuses. And another year or so for the promises made there to rescue "agriculture", are seen in the form of legislative relief.

 

Or not, weather is still the big stick. But having privatized farm policy to two Government Sponsored Enterprises (crop insurance and ethanol) left a very large hole in the safety net.

 

Two years of decent weather and Basse's $2.75 corn may be optimistic. Insurance set prices will lag the decline but will still decline. An APH yield with a 20% decline in spring to fall set prices nets zippo. Although set prices for 2014 will probably be high enough that year 1 would be far from a bloodbath. A second year would begin to get serious.

 

If the tide goes out I guess we'll see, like Uncle Warren says, who's been swimming naked.

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hardnox604008
Advisor

Re: Now that corn prices are below $ 4.50

However I'm sanguine in believing that the government will always come to the rescue.

 

So keep the pedal to the metal boys- if you don't someone else will and they'll be the last man standing, not you.

 

If you think about it, the corporate model works so much more efficiently with only 20-50,000 acre operators left. Maybe bigger.

 

You can eliminate a huge number of loan officers, salesmen of seed, chemicals, equipment, close all those marginal elevators and fert plants. Also no furthre need for FFA, 4-H and Land Grant Universities (so they can take their teams pro). The NFL needs a franchise in West Lafayette.

 

Like most good futurism- there isn't isn't anything new there, just an exrapolation of the present.

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425Cat
Advisor

Re: Now that corn prices are below $ 4.50

Just like the our health care system this admin is cuurently destroying . Ag is next. These guys despise success. They will try hard to destroy ag.
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BA Deere
Honored Advisor

Re: Now that corn prices are below $ 4.50

Well, in the last few years one important thing we found out was, those that are the buyers of corn can pay $7 and not go broke en masse, given the economic environment they`ve had.  Oh they bellyached but they were able to pay up.

 

I have no idea where we go from here pricewise, ideally water should find it`s level with lower prices taking fringe acres out of production and less ethanol means more fuel burned, increasing gas prices, making Ethanol look more attractive again.  Less DDGs available means more corn and beanmeal needing to be fed. Could be a volatile few years while the water finds it`s level.

 

Or if too many BTOs are "swimming in the buff" there may be a fire sale on their big accoumulated large tracts (all that burying groves may have been for nought).  If enough "Janet Yellen dollars" are floating around from Wallstreet and the sheriff is at the courthouse steps "giving land away" it might look inviting to to plow the Wallstreet windfall into farmland.  I`m not predicting, just saying what if?

 

5 years from now tractors will drive themselves, in the 80`s we heard "large hog setups won`t work, who`ll stay up with the sow that`s piggin`?"  So, no one is indispensable.

 

If someone rents most of the land he farms and doesn`t have long term leases, his cost of production can rapidly go up or down along with the Board of Trade.  The guy that owns his land can be the low cost producer depending on how much he wants to mine his soil and how cheaply he wants to work.

 

But as I say I don`t know, there`s alot of forks in the road and the weather is always a wild card.

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kraft-t
Senior Advisor

Re: Now that corn prices are below $ 4.50

And how will they destroy ag? Just asking!

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Hobbyfarmer
Honored Advisor

Re: Now that corn prices are below $ 4.50

Tax code

Embargo

War
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425Cat
Advisor

Re: Now that corn prices are below $ 4.50

What Hobby said to answer your question Krafty.

 

Now back to health care. Its getting personal. Been diagosed with lymphoma , ( probably from too much 2-4D not sure) just had a bone marrow biopsy done. Will probably start chemo first part of december. I  currently have great health insurance and great doctors. Okay now what?? Wiil my insurance be cancelled half way thru chemo.? Will I be able to keep my doctors if I have to get a new plan.? Who pays for the chemo during laspe of coverage.? This is the real deal not some Utopia a bunch of policticians dreamed up in Washington.

 

Reminds me of the 80's farm crisis when Volocker pulled out his bag of tricks and basically said let the wailing begin. As numerous family farms felt the ramifications of his policies.the fat cats in Wahington dined on caviar and fine wine.

 

My gosh I hope people wake up and destroy progressive liberalism once and for all..

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