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Advisor

So where does synthetic trade bottom?

Any ideas on old crop corn?
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8 Replies
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Contributor

Re: So where does synthetic trade bottom?

Benson Quinn (ADM) had the May at $6.77 and the July at 6.565 synthetically at the close.

 

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Honored Advisor

Re: So where does synthetic trade bottom?

Well, the endusers had better drop a little extra in the collection plate this Easter Sunday, because they just got a divine gift.   FWIW a local elevator is almost exactly a buck higher for cash corn than they were a year ago ($6.18 then).  They are going to buy as much corn as they can as cheap as they can, then they will pay more and they can get away with that because right now the bears have the Big Mo.

 

On the otherhand if those that have physical don`t cooperate, buyers are going to have to do something, fiddle with basis or whatever, you can`t get blood out of a turnip.

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Senior Advisor

Re: So where does synthetic trade bottom?

Does anyone other than me see today and possibly the next couple anything other than just a bump in the road? I mean who knows what we can produce any better than us, the producers? Yes we took a hit & that might bite a few that still have old crop to sell, but they had several opportunities in the past to move their grain. I believe there will be additional opportunities in the future. Our seed hasn't even made it out of the bag yet. The USDA obviously had to report numbers that would buy them a few more weeks, possibly months. If they would have reported the figures everyone thought would be accurate, do you have any idea what that would have done to prices 6 months from now, especially if we have any more delays and growing conditions other than ideal?

Don't let a few days of radicle market movements make you jump and make impulse decisions. Yes we can all bitch about it, but that never solves anything either.

Patience is a virtue of a wise man!
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Honored Advisor

Re: So where does synthetic trade bottom?

Kind of encourages some Brazilian farmer to plant more corn that takes 2/3 of the gross just to get it to port from his little slice of outback country. Maybe even break out another section?

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Advisor

Re: So where does synthetic trade bottom?

Good point Shaggy. Still think that end of quarter, long weekend, traders seeing USDA numbers as gospel, etc are all taking its toll. At least I hope I am right! Guess I will find out what basis is doing now as it has been down lately. If synthetic goes to price mentioned above maybe we should watch out below? Kinda cold and wet in some areas and still dry in others. Palmer index for us is a joke still as yes we have gotten some moisture, but are still really dry.
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Veteran Contributor

Re: So where does synthetic trade bottom?

If those extra 400 Mil bu are there , it is beacuse it can't be sold, due to too much Afotixin.

It is blend corn not available before Sept.

 

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CardinalsSL
Friend

Re: So where does synthetic trade bottom?

They can be sold, but at a =$0.50-$1.00 discount.  Can't buy the save to blend off plan as the spread between old and new has been over $1.50 (and close to $2 a couple times), so save 50 cents to lose a dollar fifty?  Aflatoxin is killing our exports!  Sell your corn at $7 with a 50 cent discount now, sell it in June at $6 with a 50 disount, Aug at $5, and Sep/Oct at 4.50.  Ask somone who has tried to blend aflatoxin how that works.  Basis will be good for good corn only.

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Contributor

Re: So where does synthetic trade bottom?

With logistic cost so high in SA and 4.50 dollar corn right around the corner...some latin american producers better find a different job. Production destruction.
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