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Senior Contributor

Re: futures now

My commentary on the industry is not a personal attack against you or anyone one else in particular. But in your case you find it acceptable use personal attack against me rather than argue the facts of the matter. That is puerile behavior. 

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Veteran Advisor

Re: futures now

 
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Honored Advisor

Re: futures now

Harvest lows so far have been about $3.07 @ the e plant, $2.98 or slightly less at the coop here.

 

Right now $3.58 jfm at e plant, really considering starting pulling the string on some. We had just a short handfull of days this last marketing season this high here.

 

Planted no beans this year. 

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Frequent Contributor

Re: futures now

Basis narrowed here on corn a couple cents today at local coop.

That doesn't happen often when there is a significant up day on the CBOT

Local cash price now $3.16 

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Senior Contributor

Re: futures now

So when I told you to start offloading in the futures market at $3.65, you gave me a hard time, but now you want to sell at $3.58 in the cash market. I know, you'd have to keep the $880 per 5000 bushels on margin, which costs you 2% interest from the bank for that money for the next 6 weeks until first delivery date. The 7 extra cents per bushel were worth more than losing the interest on the deposit.

 

Its amazing you succeed in spite of your self. 

 

I think you're making a wise decision in starting to off load now, btw. The same way I am advocating a scaled in hedge here, I think you can do the same with cash delivery, 20% now, 20% a bit higher, 30-30% if we get up near $4. If we break $3.40 to the downside, don't be bashful, that's now the make or break point for the market.

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Honored Advisor

Re: futures now

Just looked $3.26 local cash

 

$3.47 Jan local

 

$3.58 @ eplant JFM with only shrink no drying charges and a liberal grading policy not a bad place to take 16/17% corn.

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Senior Contributor

Re: futures now

Some end users with immediate demand read my prognosis after the report (or came to the same conclusions as me)  and decided to save themselves 10-15 cents by stepping up to the plate and buying what they need before the price moves to the levels I am expecting.

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Senior Contributor

Re: futures now

Why is the cash 45 cents a bushel lower than the futures price ? It can't be that much for storage for six weeks until first delivery...is it the transport costs associated with delivering into a CBOT contract ? Seems like a good business to buy cash and sell the closest future, unless the delivery costs represent the basis difference.

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Honored Advisor

Re: futures now

You advocated selling about fifteen cents ago/ you also don't know about raising it and basis plays. Basis can't be delt with in your world.

 

With the carry it amounts to about fourty five cents over your "bottom third marketing" advice. NO BROKERS INVOLVED. Only checks written will have my name as the payee. (Except two days after delivery there is a direct electronic deposit In to my acct. )Yea I know sucks to be me.

 

You need to understand I am naturally long till the bins run dry. I prefer to drive the new pickup every year, NOT give it to a broker, adviser, or trader every year. Those pennies you talk about are exactly the ones that I prefer to give to the pickup dealer. At least I have something besides a deduct with absolutely nothing to show for it. Btw the pickup is 179 deductabe also.

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Frequent Contributor

Re: futures now

Ray, you understand how basis works right? In southern MN for example it is 55 cents.

That means the $3.65 CZ would net $3.10 cash for a farmer here at the local coop.

 

Hobby is doing great if he is getting 3.58 cash.

Sound like he will be delivering in Jan, Feb or March.

Therefore his bins are returning 48 cents/ bu for storing a few months over what you are suggesting.

That is why we have bins, in addition to improving harvest logistics.

 

You seem to think farmers can deliver and receive CBOT prices.

That's not how it works.

Basis is a big deal to pay attention to.

 

 

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