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Veteran Advisor

Scare tactics ?

Our local terminal just lowered the basis by about 20 cents this morning. Are they buying that much old  crop corn, or is there something else going on in todays markets?

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14 Replies
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Senior Contributor

Re: Scare tactics ?

maybe they think its a bullish report coming our way?!?!?!?

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Veteran Advisor

Re: Scare tactics ?

So they are getting ready for a limit up action in the overnight e-trade?

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Senior Contributor

Re: Scare tactics ?

  Enough physical corn was priced  last Wed to keep the corn flowing through July as some bids finally crawled to over 7 dollar cash in the upper Midwest. The commercials are content to play the waiting game as the USDA has done them big favors lately.

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Veteran Advisor

Re: Scare tactics ?

OK, I gotta ask

 

what big favors has the USDA done for the commercials?

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Senior Advisor

Re: Scare tactics ?

Well Well Well Ray --How about telling everybody we have a great crop coming on - then that drives the price down so the commercials can make  millions and then they use that money to send to there favorite crook in Washington to get reelected -- lmao

 

BTW If you guys would kick in alttle better out there - the dam DOT would leave the truckers alone out there -- also lmao on that one

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Senior Contributor

Re: Scare tactics ?

OK  Ray only one favor the finding of 400 m bushels in the last stocks report. IMO futures would be above 7 with cash bids at 8 if they hadn't found  the bushels.  Disclaimer I don't know if the  stocks number is correct or not

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Veteran Advisor

Re: Scare tactics ?

That "extra" 400 myn bushels, as you gents have put it, would only help if a person was a flat price corn buyer......for a basis trader, which most of the biggies are, they would have benefited more had the extra 400 myn not been found, futures would have been higher, and quite likely the corn would have been sold with a wider basis than what is currently going on...

 

yep, hard to believe, but that actually COST us money....

 

oh, and I have no idea on whether the stocks is right,wrong, or somewhere inbetween,either

 

a few guys decided they were not going to play in the corn casino on Friday and sold some old crop today.....actually surprised me as I assume anyone who has ridden this horse since August of 2012 was going to stay in the saddle for one for spin....

 

 

 

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Senior Contributor

Re: Scare tactics ?

So Ray are you basically telling me you were long futures as a hedge and you have lost more on that hedge compared to what the price of cash corn has come down. Actual numbers would be nice.  Btw I don't think you can assume the corn would be easier to be had just because futures are higher the corn is in strong hands and the basis could be easily just as strong as it is now.

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Veteran Advisor

Re: Scare tactics ?

At any given point in time....if futures rise 20 cents, will it be easier or harder to buy cash corn.....I say easier, maybe you disagree

 

so going back to the "gift of lower prices",  I would contend that lower prices mean it is harder to buy cash corn, and thus have to pay more in the form of basis....

 

 

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