cancel
Showing results for 
Search instead for 
Did you mean: 
Honored Advisor

Re: TID BITS

Definition of expert...

Ex, - past tense, as in "has been"

Pert, pronounced "spert" as in" drip under pressure "
0 Kudos
Senior Contributor

Re: TID BITS

You talk to your doctor that way ? Telling him he's a has been and a drip under pressure ? After all s/he's an expert too you know. Or are you one of those who brags about never seeing a doctor, and then wonders how in the world you could have contracted a disease ? 

 

Unbelievable...were you ancestors from England perhaps, from a community called "Luddites" ?

 

Don't you have a crop to harvest now that the sun has come out ? 

0 Kudos
Esteemed Advisor

Re: TID BITS

Well if you bought beans yesterday, I'll be spending your money :-) Thanks for taking the other side.

 

Honored Advisor

Re: TID BITS

bless ya time ----whatever you type is a breath of fresh advisory air.

 

What trader, or advisor, antagonizes the source of product that they trade...??  

 

Peanut gallery  ---- 

0 Kudos
Senior Contributor

Re: TID BITS

Sssh, don't tell Hobby Farmer, I told him I did a beans to corn spread trade, buying the beans and selling the corn, just to shut him up about how badly he sees the bean damage from the weather. I don't trade beans, only corn in the ag commodities.

0 Kudos
Senior Contributor

Re: TID BITS

Exactly, I am not here looking for business. And there are times I have more of a stake in the corn market than most of you. How many among you have been either long or short a million bushels of corn at one time, eh ? And I am just a small fund, I can't imagine the sizes of positions some of the big boys play with.

 

You might think we are the peanut gallery, but we are just as much invested in farming as you. You wouldn't talk so badly about people like me if I was positive on the market. Then we'd be invited to Sunday dinner, maybe even get a chance to meet a farmer's daughter or two...

0 Kudos
Senior Contributor

Re: TID BITS

So you want me to give some expert (have not seen one) money to and you are saying it’s costing 40 50 per acre on 2000 acres I’ll just build bins and take advantage of the price and basis increase and you so called experts can buy my grain when it’s above my break even and not sit in line waiting to unload
0 Kudos
Senior Contributor

Re: TID BITS

While that corn is sitting in bins its costing you money and tying up your capital. Better to lower your price of production by using financial engineering so that your breakeven is lower and you can re-cycle your capital more frequently. That's ho you make profits in business and build wealth.

 

As I described in another post, for nearly a twenty year period from ~1986 to ~2006, corn stayed in a range between $2 and $3. It spiked in 2006 through 2012 for several reasons, ethanol and Chinese demand being the main ones. But since 2012, you've been in a bear market, a victim of your own success. Better farming methods and machinery along with the ingenuity of the American farmer have more than met the world's demand for most of the agricultural products you grow. 

 

Markets have a strange way of returning to the place where they used to be, and I think that's what's going on in corn. So the risk you have for being stubborn is that while you're waiting for a return to those glory days, you'll be watching your $3.60 corn become $2.60 corn, and your accountant's and banker's heads will explode because your equity got cut by a third. 

 

The only way a producer can avoid this scenario is by taking advantage of every price bounce to hedge your coming production. You should be more concerned with falling prices than rising ones, because the falling prices put you out of business. The market is quite clear in what its saying : as the overall economy has gained momentum, crop prices keep falling. What do you expect will happen when the inevitable recession comes ? If prices fall in good times, they avalanche in bad. Add in a trade war with your second or third largest customer, and the competition with the huge farm conglomerates, and you have to use every weapon in your arsenal to stay alive. Hope is not a weapon, its a path to surrender.

 

Look, I'm not telling you how to run your business, but suggesting ways you can increase your profitability by 10-15% and avoid catastrophe in the worst case situation. Its a new world in farming than it was ten year's ago, farms are far ore productive, competitors have greater capital and are able to lower their costs of production to maintain profit margins in a falling price environment. You either adapt or die. That's the bottom line.

0 Kudos
Senior Contributor

Re: TID BITS

Interesting. You are now a confirmed liar whether you did or didn't.

0 Kudos
Senior Contributor

Re: TID BITS

Who exactly is it that you are calling a liar ? And why ?

0 Kudos