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Honored Advisor

US Farm Report

Al talked to Bob Uttback and Andy Shissler and both agreed to be darned careful selling this summer, if the drought continues and expands the bushels might not be there.  Utterback is usually such a bear that I can tolerate him a little more than a Democrat or a Ford driverSmiley Wink   But he was kind of sensible this morning "beans are tight and could be explosive"(of course the one year I lock in some).  Shissler is a crop insurance man and says in his travels, the cream is off the this crop even if we get timely rains here on out(which isn`t in the forecast).  Utterback says `1 1/2 years out, look for inflation`.   I miss the old Earl Finkle weather forecaster on that show, he would nail the weather 2, 3 months out to a drop.  Anyway, if you get the chance watch the show, if you miss it, it`ll be online in a couple days.  Utterback said something that I didn`t quite catch about those with a "premium hedge?" need to be careful if corn gets over $6 and beans over $14, I`ll have to rewatch sometime.   

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Veteran Advisor

Re: US Farm Report

I haven't seen the show, but suspect that he is talking about products like Cargill's premium offer and others offered in the industry.

 

As an example: last spring you could add 30-35 cents to cash selling price by using a premium offer based on December 2013 futures at the $6 strike price and an expiration date in mid to late October of 2013...the price has to be at or above $6 on the expiration date for the additional bushels to be sold.

 

Some of these contracts have double-up features as well, and have heard some comments from unhappy producers who were involved in those particular products..

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Veteran Advisor

Re: US Farm Report

Democrats compare to Ford drivers how? I resemble some of that sentence ya know!  Anyhow what amount of creamis off the crop? did we drop from a 180 avearge down to a 175 or is something worse?

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Senior Contributor

Re: US Farm Report

Might be cutting three foot tall corn this fall with the bean head. Not a chance for 175 corn here...............

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Honored Advisor

Re: US Farm Report

You do know i'm pulling your leg, Jr? I'd rather drive a ford than vote democrat, you'd at least you stand a chance getting a good ford Smiley Happy i gotta admit ncia's corn looks tremendous, good as i've seen this time of yr. Hope everyone gets the rain they need. Thank you Ray, that sounds like what Utterback was talking about....something else that i won't be touching with a 10 foot pole Smiley Happy
Frequent Contributor

Re: US Farm Report

I'm personally not doing any pricing until I see a reasonable chance of change in this weather pattern.  Crops in our area look pretty darn good.  We could use some rain but I'm more worried about the heat at this point than the rain.  Tile is still running around here so the moisture is there we just need to avoid these 90+ days with 20 mph winds.  The next 2 weeks will be pretty critical as our earliest planted stuff has a few tassles poking out and 70+% will be tassles 2 weeks from now.  I think we are looking at an average crop here unless the rain starts falling, then we will be looking at a big one.  At this point the question isn't how good are the good areas but how bad are the poor areas.  It is almost impossible to quantify the damage in the drought stricken areas until actual yields start coming in.

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Senior Advisor

Re: US Farm Report

No more new crop pricing for me for the present.  The corn around here is quite variable.  Some looks quite good.  Other is ragged and struggling.  The early corn looks best.

Marketing could be a challenge.  The trade will insist on proof of yield problems before it boosts prices too much.  The first hint of rain will drop prices.  It is easy to see a scenario where we start looking at 6.50 corn and find we wish we'd taken 5.50.

Very challenging. 

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Honored Advisor

Re: US Farm Report

How many producers out there have thought they were only 40% sold on new crop and are now realizing that they may very well be 80% sold due to the drought?  When the endusers finally realize that the farmers are not going to make any more sales for a couple of months and maybe longer.....well, you know what that is gonna do to the prices.

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Senior Contributor

Re: US Farm Report

    A look at the climate prediction center drought outlook for the summer of 2012 and one would have to think early pricing to be quite a gamble!They are usualy on the money for correct outlook.

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Advisor

Re: US Farm Report

BA , i'm glad you clarified the ford thing. I was 100% gm 'til they(gm) got bailed out. I love to tell conservatives with new chevys "oh , yur driving a pickup from obama motors!" We are very fortunate ncia and hope everyone getss the rain they need, soon.  My big concern for the corn market is the poor ethanol margins. add higher priced corn and now we've got real problems. Bright spot for ethanol is ddg's are in in good demand.

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