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Senior Contributor

Remember the 1990's?

Maybe the trade "just knows" that September is going to be nice and warm, and that the last couple weeks of cold weather is an aberration to "global warming" and those immature beans and corn plants here in Minnesota are going to transform into 210 bushel corn and 60 bushel soybeans.

 

Or, maybe, the farmers not selling know something too. Those pivotal 1990 years,( can't remember exactly which one was which anymore), but the time after the Mt. Pinatubo volcanic eruption really showed how inexact the US government is at predicting supplies, usage, ending stocks and the really important one...PRICE.

 

The $5 per bushel corn back then paid off my farm debt, got me forward from 20 some year old combines to five year old machines, and was probably a bigger deal than the $8 corn was a few years ago. Those were the days when I didn't have any crop insurance except that CAT policy that I don't think ever paid me a dime but only cost $100 per year, and I paid the price with ulcers and sleepless nights wondering if the 99 corn was even going to make it.

 

Now, this year I have soybeans with a long way to go to maturity, corn with ears not even in the ballpark size wise with last year, and some replanted corn that has stood there, ready to tassle for the last two weeks. I read somewhere that the corn plant shuts down at 60 degrees and takes heat above that to start up again, so I can see why the plants are not advancing.

 

I thought that corn and soybeans were poised for a breakout, limit type move before the 8-10-17 report, but never dreamed that the experts at USDA would come out with a national average of 170 corn, 50 beans and say "bumper crops". Who do these clowns think they are......the 538 prediction crew that had Mrs. Whatsherface up by double digits? LOL

 

That report is a classic example of why whatever the private sector can do, they SHOULD do. Earmark this post, come back in January when corn and beans are trading based on fall yields and let me know how wrong I am. OK?

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4 Replies
Veteran Contributor

Re: Remember the 1990's?

Omg if you are that bullish I would think you would be attending every land sale you could right now! Not sure I believe the report but I did have a a nass employee stop at the farm to ask to do a yield check awhile back. They do have some boots on the ground, I was actually impressed/surprised how serious he was and the paper work he was filling out
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Honored Advisor

Re: Remember the 1990's?

image.pnghttps___cdn.meme.am_cache_instances_folder776_500x_80150776_success-kid-169-bushel-corn-because-usda-says-so.jpg

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Veteran Advisor

Re: Remember the 1990's?

rsbs........as prices started to rise in the fall of 1995, we purchased a LOT of corn for July 1996 delivery at $3.......enough so that when the company board of directors came to Eddyville for the first time in the summer of 1996, one of the questions was whether or not farmers were delivering on their cheaper contracts...

 

I assured them that farmers were keeping their word (and signed contracts) and delivering that $3 corn...

 

we had also been asked to do some research on how many contracts had been signed/returned.....it was like 98%....

 

after all, when corn was $3, it looked like a very good price at the time

 

after that, we became more diligent about checking for contracts that were not signed or returned

 

I think the operative was "heading a potential problem off at the pass"

 

PS----it's more about margins than just the cash price......am sure those who had corn to sell at $4-5 in spring and summer of 1996 felt like they had hit a big lick....similarly, those who got the first big wave up in corn price in the ethanol buildout were still dealing with reasonable land and input costs compared to where they eventually went....

Honored Advisor

Re: Remember the 1990's?

"When corn was $3, it looked like a very good price at the time"............for the buyers.  Smiley Wink

 

I remember filling my measly priced  HTAs  while their were a few guys that didn't. Some of these guys had at least two years' worth of corn on HTAs and got to walk away from them causing a few elevators to go out of business.  

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