Reply
Honored Advisor
Posts: 8,887
Registered: ‎07-18-2011

Wheat------July 25

Right off the bat someone might wonder "do you still have that wheat?"   Well the paper wheat unfortunately the answer is yes. and it is breaking even today at 4.78................ There is only one answer today.......... stubornness and a perpensity to stay busy when and ignore volatility.  

I like reliability and thoughts that last longer than a news cycle. 

 

But we did s price the new crop on contract at a $4.80 plus protein bonuses...before the wheat rocket fizzled.

 

Now I will be patient and look at buying some of it back on paper as the news and market dance dictate.  But the big deterent right now is the volatility and the carry.......... it is rediculous to have 40 cents of carry in futures over 120 days.  Kcwht at 4.78 Sept----- 5.21 March     july 18 is $5.69

 

I realize there is the basis mountain between that price and the producer.......... unless you sell closer to the end user.

But I am reminded of something a neighbor said just yesterday when we were discussing profit margin and triming expenses.

 

"We are in trouble when we can't find profit in $4.50 wheat."

 

I agree.

Veteran Advisor
Posts: 4,270
Registered: ‎02-11-2013

Re: Wheat------July 25

well bless you SW, I'm  glad to hear you did well on your wheat.  I know the last few years in your neck of the woods hasn't been

the best.  I note that the FSA declared drought area is in your neighborhood.

 

I didn't do as well as you, I am sorry to say.  we were still cutting then or doing something, I can't remember anymore. I knew wheat

was up, I thought that was good.  I figured that this was a counter seasonal move.  that is usual when there is a problem with the

crop, which despite all I was told today, I still believe that wheat could be in short supply and should be higher than now.

 

the say the last two stages in marketing is "hope" and "pray"........i'm at the pray stage.

 

I guess I needed some sort of expensive guru that would have called an hounded me that I need to sell.

 

I figured it would still be there when I got done.....it wasn't.