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Frequent Contributor

Re: Weekly Outlook From Darrel Good

With it not raining west of the Mississippi its going to be hard to raise a monster crop. Seem the weather pattern east of the MIssissippi  has changed for the better and the west is more of the same. Heres to year 3 of drought for us.(SW MO)

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Veteran Advisor

Re: Weekly Outlook From Darrel Good

Thank YOU ECIN!  Jim, yes the article is simply a summation, a snapshot perhaps. I only question it's real world VALUE.

   Just b/c of my ignorance (limitations of not being in the physical mkt), who are "THEY" that say buyers would go to Brasil?

 

  roarin, you might've highlighted a key point that farming has/is changing - and nothing better than your ending quotation - opor + prep = success................. Important also, could be a definition of "drought" - compared to 1988 (% harvsted ac) maybe 2012 doesn't meet the criteria???..................... Maybe a whole host of factors are shifting (EVERYTHING?) ........that is not addressed here......................so, yes I was confused by this being a "micro - contextual" summation -IMO.............MAYBE Mr. Good is "inadvertantly?" highlighting/warning of the HUGE descrepancy between the 2 different hypothetical trend yields & therefore the LARGER potential opportunuties, roarin?..........................Maybe, in order to obtain a better real world context we would need to consider yield data going back to 1900 (i beieve it was posted pretty recently - can anyone find it?)

 

too close, I assume he profits financially from writiing and publishing this  "summation - jmo - this word somewhat of (a euphimism)"

 

thx.

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Honored Advisor

Re: Weekly Outlook From Darrel Good

I'm west of the Miss R and it is raining like a cow Doing it on a flat rock here this morning. (Kauai).

I think Darrel did an extremely POOR job of making any kind of point. Someone in his position should have been capable of stating his thoughts in a much better way.

What he put up was the equivilent of political double speak. From it we have seen almost three interpitations. Really sad for a supposidly professional.
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Honored Advisor

Re: Weekly Outlook From Darrel Good

c-x-1,   The more that I read these posts about what could or will happen with the grain markets and the new crop plantings, I keep coming back to my signature quote.    My real thoughts are that farmers should take a chance or two during these times, but not bet the entire farm one way or the other.  Prepare for the worst, hope for the best, and live to farm another day.  I just love a good cliche'.

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Senior Advisor

Re: Weekly Outlook From Darrel Good

I have to say you guys would gripe if you were hung with a new rope.  

 

Goods piece is dead simple.  He explains why prices are what they are, the components of what will make prices be what they are this coming year (with a discussion so you can decide which position you prefer to take) and leaves you with the conclusion that if you believe what the analys say you'd better sell 2013 corn now and if you don't sell ahead you must be figuring one of the price components that the other experts identify and the Good simply summarizes for your use is wrong.  Well, if one is wrong, which one and by how much?  And, if you decide the experts are wrong, are you sure that the demand destruction won't cap the corn prices at $7.50, anyway?

 

Where are you going to put your marketing money in 2013?

 

So here are your options:

1.  We're going to plant a lot of corn and it will all grow so you'd better forward contract your corn now to lock in the best price you'll see all year.

2.  We're not going to grow a lot of corn but there is so much demand destruction that prices will cap at around $7.50/bushel so you can lock some in now or avoid marketing, it won't matter much.  Oh, and you'll want a bunch of crop insurance.

3.  We're not going to grow a lot of corn and there will be enough demand that prices will rise.  You won't want to price anything yet and you will have to decide if insurance is a good risk management tool or you can live without it.

 

What I'm going to do is not sell anything now and take out max crop insurance.  My expectation is that the drought will linger to enough of an extent to hurt production so that prices won't drop too much, and there will be some demand destruction but not so much that prices will fold up.  I'm looking for prices in the mid 7s or higher.

 

This may be a year to use the put to place a floor on the price and then expect it to go up.  For many, crop insurance will do that.

 

 

 

 

 

 

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Honored Advisor

Re: Weekly Outlook From Darrel Good

cx-1,  Long term yield comparisons are the worst form of distortion.  There are at least 4 or 5 uncomparable stages of agriculture in the last 100 yrs.  Anyone who shows us a trend chart that goes more that 10 yrs is distorting.

Second point.  If the data base is too big the comparability is distorted.  Example---A national yield comparison year to year includes too many variablees to know what the causes of change are------ there is just too much variability with some areas being affected by so many different changing issues.

 

 

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Veteran Advisor

Re: Weekly Outlook From Darrel Good

           Sorry Jim, didn't intend for it to be griping. But i suppose if we're honest, that's a part of it!

 

I believe sw, you are right on the money!!...............I should have been more clear................(MT) identified in an earlier post the last ten year trend IS DOWN.

      My thoughts were to attempt to have ANY accuracy moving FORWARD we need more data (than just going back 50 yrs as article suggests) to choose from to find perhaps some ANALOG time periods that are more appropriate w/ ALL THE VARIABLES going on now.

   

yes, as you said, sw, the sheer # of variables is humbling. therefore, there are some closer "fits" than the BUSINESS AS USUAL - lets go back 30 yrs or 50 WITHOUT REGARD for all the possible variables.

 

c-x-1

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Frequent Contributor

Re: Weekly Outlook From Darrel Good

Im glad your getting rain Hobby, enjoy it becuase theres a lot of people not seeing a drop and havent for some time.

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Advisor

Re: Weekly Outlook From Darrel Good

Pretty simple its  all about the weather.

Problem now is new corn at 5.50 not real exciting, if she don't move up during Feb the guarantee isn't very exciting either.

How much will guys risk if it doesn't start raining. Why not plant beans less cost if it dont rain.

Everyone plant 20% less corn , save on costs, go long corn on the board.

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Honored Advisor

Re: Weekly Outlook From Darrel Good

The swing acres are west of the Iowa/Nebraska border.

Crop insurance favors corn from a gross revenue most years lately. Bean, milo, sunflowers have lesser guarentees or reasons to be planted. Beans in the western 1/3 of Ks at least, were yield downgraded last year By fed crop. Can't justify planting them without a good begining moisture profile.
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