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Honored Advisor

Should those that have RA ins and have to sell this fall...

..be hoping for a collapse of Dec corn?  To the point the basis would have to improve for local demand.  Because it looks it might be either side of having a claim and all $650/acre guarantees aren`t the same, given basis isn`t figured. For an extreme example $2 dec corn with a plus $1.50 basis, may mean a fat insurance payment to take the sting off.  A $3.60 dec corn with a  -80¢ basis could mean the insurance would wash their hands of you AND you`d get no where near your revenue guarantee even with a decent yield.

 

 

I know this is old hat for you gurus, but unless the board improves alot and the basis doesn`t get worse.  Might as well join the chorus of "Monster crop!  335 bushel per acre easily!"

 

"basis" will make the difference of if you eat 80% lean hamburger or Kraft Mac & Cheese.  Smiley Happy

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4 Replies
Senior Contributor

Re: Should those that have RA ins and have to sell this fall...

I would expect a wide basis on corn. In fact you may have to pay them to take it.. Your tax problem is solved BA. Don't forget to give barack the credit.

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Veteran Advisor

Re: Should those that have RA ins and have to sell this fall...

BA.......pretty exaggerated basis on the up side there, don't you think??

 

I think a "strong" basis in much of the midwest will be option price to ten over

 

but I am expecting our basis in early November to be -25 to -45

 

but I do understand the concept you are trying to describe

 

good luck

 

Ray J

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Senior Advisor

Re: Should those that have RA ins and have to sell this fall...

depends on APH and what kind of crop you are starring at...........

 

to get this massive crop to get to $3 on the board, there are going to have to be some home run yields................well home run yields will out run the price in the ratio, thus doesnt really matter.............lack luster yields will bring home the point the crop isnt as big as once thought and likely put a dollar back on corn........

 

the guys in the cat bird seat for a scenerio like this are those with high APH's, took out 80% or more coverage, have a mediocre crop coming but not disaster, good basis area, storage, and tanking fall price to $2.62...........

 

IMO, grain bins are a must.................I DONT CARE IF YOU FORWARD CONTRACT OR NOT...........being able to take it to the bin, cure it out and avoid all the fall nickle and dime crap will pay for bins real quick..........and in our area, the basis move alone pays for them real quick........

 

so to answer your question, it depends, and frankly if you have zero bin space and have to deliever this fall, well IMO its a little late to be making plans...........just like last year, it will take time, but corn put on over a dollar from the fall low to spring high..........

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Advisor

Re: Should those that have RA ins and have to sell this fall...

YaaaaaaH baby come to papa
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