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Senior Advisor

anyone.......

Notice how good the corn looks at FPS......

Here's your sign.......

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Contributor

Re: anyone.......

Good point. I haven't been there but I am sure it looks poor. Corn is nearly double the price that it  was a year ago today. Evidently the market is somewhat aware of the short crop. Now that $7 corn is being used do you think that some rationing has begun? I think some rationing has begun but definately not enough yet.

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Senior Advisor

Re: anyone.......

Its horrible, what we saw shell probably struggled to hit 100......

Yes the market does know its 12.8 short, but not 12.3 short.......buckle up boys.........

Total demand has not been rationed, therefore we are still chewing thru corn, soya, wheat.......
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Veteran Contributor

Re: anyone.......

With that short of crop and no demand rationing yet happening where do you think corn prices need to go to? 8, 9, 10, or higher then 10, and if we don't get there until next summer how high could we be?

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Veteran Advisor

Re: anyone.......

MT what would the ideal demand rationing scenario be? 

 

BTW was the sidn a big P one?

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Senior Advisor

Re: anyone.......

lots of signs, everywhere, as usual.........didn't hear what the demo plots were planted to..........it was DRY, came off the combine like wheat...........didn't hear any yields either, but it looks like sub 100 corn..........

 

it was bad.......

 

 

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Veteran Contributor

Re: anyone.......

What does that translate into price or price range for the next year.

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Senior Advisor

Re: anyone.......

talked to a grain buyer in the Champaign, IL area............their take was that area was going to be very short corn............pressed on the $9 corn issue and the general thoughts were we gotta break $8 and the government would step in before $9...........pressed on where and what that would look like, temporaray suspension of ethanol MANDATE...........

 

IMO I am surprised we have rallied like this into harvest, but I think it lends credence to the fact this market knows it has to squeeze something, but its not sure what or when.................

 

we are range bound for awhile...........policy will dictate large movements...........if its a bearish policy we slide hard to the down side.........if its a bullish policy we go higher..........

 

IMO playing with the mandate will ruin the markets...........because from that point on any time we even come close to a supply problem, the market will trade like its not an issue because we can just close the ethanol spicket for a month or two.........grain prices will go back to 2009 levels...........

 

as for the question of what gives............IMO it needs to be exports, but thats the hardest to do given our weak dollar........

 

INTERESTING QUESTION HERE:  HOW IS DEMAND DESTRUCTION DEFINED.............is it destruction if the pool of buyers shrinks but consumption stays static or grows............to me that is likely what will happen and does not define demand destruction because consumption is still there, the buyers are redefined?????????????.........true demand destruction is an overall worldwide reduction in consumption of course grains and oilseeds............THAT IMO IS NOT GOING TO HAPPEN IF YOU LOOK AT IT FROM A MULTIYEAR OVER YEAR COMPARISON................

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Re: anyone.......

Everything has to be viewed in the context of our broken political system.

 

Iowa caucuses are waht, late Jan or Feb? Of course the disproportionate representation that Iowa receives owing to that strange quadrennial event helped create the background here and will continue to influence it.

 

Dunno, I think it will be fun to watch if you enjoy Three Stooges reruns.

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Veteran Advisor

Re: anyone.......

Playing with the ethanol mandate is not that simple, especially if gasoline futures stay above $3 like they are now.  Cut back on ethanol and gasoline prices go even higher,  a death blow to the US economy.  Cut the mandate, and don't you discourage corn acres next year, is that what they want?   But, that doesn't mean it won't happen, just hope they understand the possibilities it creates.   Brazil cut it ethanol from 25 to 20.  That move will increase crude/gasoline prices around the world.  Throw in a hurricane hitting the big platforms or refineries.     To me, the only way grains crash in the next ten months, is a world economy crash that no one wants.

 

Corn and beans could take a lesson from sugar.  Sugar used to be packaged in 5 lb sacks, now its sold in 4lb sacks, makes the higher prices easier on the public.  We should price corn and beans in lbs also.  7.50 corn is only a little over 13 cents a lb. and 13.50 beans is only 22.5 cents a lb.  Kind of changes the perception doesn't it.  You tell people corn is 13 cents a lb., and they will wonder why you think that is high?  People won't bend over to pick up 13 cents off the ground.

 

 

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