The case for $6 corn and $11 soybeans

[elcheapo]

Your honor (ole eagle eye), and ladys and gentlemen of the jury...Today I will outline the reason(s) which there is a

"questionable doubt", that corn could see $6 and soybeans $11 by the end of this year.

We are using corn, for feed, etho use, etc......while true...the low oil prices is not doing the etoh people any favors, but still,

it is a major use of corn today.  if we were not using it to make it into auto etoh....we would have soo much corn we would

be needing to drink the ethonal, rather than pour in our cars.

also, there is still some demand for soybeans..

but, any disruption of supply, would have a significant impact on the price of each commodity, in a positive way.

The election.....not so much so.......alot are getting worried hearing about how alot of the blenders credits and etc

will be long gone.

But, like all agriculture, the final variable, which for most is difficult to manage (except those who are lucky to have

irrigation)...is the weather.........and reading the tea leafs.......it might be less than steller.

we are comming off a very strong el nino pattern.......we have good soil moisture profiles in iowa and mo...but there

is a trend (5 out of 6 times........good question is that a trend ?)

so.....imagine.......plenty of moisture.........hard to get crop in.......rather late due to moisture......ok...going along good,

then, the "winds" change.....we switch to la nina.....we turn hot and dry........and will be late  flowering that has

better odds of doing so in hot dry wx and that could result in lower yeilds later.

simular set up for beans..........

so.......armed with this info........how do we profit  from this info ?

i'm just a simple farmer, sprinkle supplier and owner of a billy goat rental business.......maybe some of you sharper

ones on here can outline a plan.

your honor, and members of the jury........i rest my case

[clayton58]

How do we prepare for that scenario? Buy crop insurance.  Look at upping the coverage, maybe SCO if you are not in ARC.  BE SURE TO HAVE THE HARVEST PRICE OPTION INCLUDED, NOT EXCLUDED.  Maybe reduce population a little for milo (dryland) and plant as early as soil temp is high enough.  Thats my plan for dryland milo "here".  Maybe buy some cheap calls.

[BA Deere]

ooor Aunt Janet could devalue the Dollar by half, then the inflation funds would jump in and our commodities would double.  That would be great, this unilaterally keeping a strong currency isn`t working out so well. 🙂

http://www.msn.com/en-us/money/markets/yellen-says-pace-of-future-rate-hikes-could-be-slowed/ar-BBpl...

[Hobbyfarmer]

Minus one kudo BA. 

That is killing us oldies with a few bennies. Not only no interest but devaluation of our hard earned savings.

At least that is what they tell me.

[elcheapo]

just curious to clayton.......are you going to use full season...or medium season, and using the idea it will be done

before it gets popped in the field ?

i'm going to throw another thing out.....was at a crop insurance meeting today......looks like some changes on the

horizon......first.........the CLU...common land unit.  next year the proposal is that ALL things will have to come off

the CLU....every "field".....will be needed to be listed.....this will be a nightmare........and you foul up on one

field (maybe a 1/2 acre one), you are out of luck on everything !!!

under the proposal, one person had 1200 acres...had 4 pages of field records.......with new rule......... 56 pages !!!!!!!!!!!

One of the effects will be it will push out the little mom and pop agencys since they will have 5 to 10 times the work

and time to do,  and may need to do some spot checks with an atv and gps...and all the while, the amount of or i should

say percentage of their commissions, will be dropping..

hey eagle eye, assign one of your reporters to look into it, might be a good and timly article for you, but don't know lead time

needed.

something new in our parts, but what many of you have had, is ICE...increased coverage election (some label it APO).

basicly, for a fee (and this is a private insurance product, no subsitity), you can add to the price you recieve, if you

HAVE A YEILD LOSS.  it is dependent on how much you can add, what your level is.

according to our reading material, if you have a 70% mpci, and the "likly price" of corn to be $4 bu, you could add on

$1.71 per bu, on the loss, looks like about a 8% or so risk charge....it is above your standard mcpi.

(or an additional insurance product.

but....it might be better to buy a higher percentage policy, i.e., if you have a 75% buy up to a 80%

also curious......anyone using LRP (livestock revenue protection)  ?? using the policy, or doing yourself on the board ?

lastly, anyone using wx insurance ?  where you bet....opps, cant say that, insure for a stated problem, such as not enough

rain, or temps over a certain temp ?

that might be an interesting "policy" later this year

[BA Deere]

Hey Hobbyfarmer, if we have inflation your bennies will get COLAs, your land and the grain in your bins will go up.  If you have cash just buy Krugerrands.   The only way a undeservedly high Dollar does anyone any good is if they take a trip overseas.  🙂

[clayton58]

Cheapo. On my dryland milo I usually plant a medium early. We never know the best time to plant because we don't know when(if) we'll get rain. But with a decent moisture profile and the forecast if you can believe it saying wet early, hot and dry later I hope to get the crop in early to beat the heat. At least on a good portion of it. Works some years, some years not.

[wrightcattle]

cash corn Midwest should move to the $4.75 to $5.25 now thru summer.

( usa is the only real supply )

sometimes thing just get over sold for 2 long then react pretty decent to the upside.  agri products are 1 of those things now.

Folks still gonna eat, Globally.