The site that never changes. Present data that the "herd" doesn't
want to hear and they will not argue facts, merely assault your
character. Typical mind dead responses gents.
Every year the potential yield starts out as a range, and as each
week passes, the range narrows to the final yield. At least that
is how the math works in our view.
So, this year, my numbers would suggest Vince is a little high
at 187. It is however very clear that 180 is possible in a 1992/94
type year. It is very rational for you S&D guys to run one at 180.
Also, very rational to run one at 135. (Math I did in my head just
shifts Vince's curve down about 5 bu is all).
The result is that the numbers are the same everyyear. Carryout
after the 2012 crop can easily exceed 3 Bil bu, or it can stay at
virtually zero. Any price above $6 is rationing demand, or enticing
production increases which WILL create a surplus sooner or
later. Counting on weather do maintain NO surplus is just
VERY BAD MATH if you farm in US midwest.
Lots of smart gus with super-computers and Billions invested
already know this stuff and therefore I choose to just focus
on TIME and the market's response to news as a way to note
when they tip their hand.
Back to Hardbody's question, Ind has been way above normal
on temps since June 2011. This rarely lasts more than a year,
but obviously it could. Weather this year is almost never like
last years, so I would guess the odds favor a warm/dryer spring
followed by a very hot June, and then a shift too cooler in July
and August, with a big hurricane surge of moisture in August.
Exactly the conditions needed for an above trend yield, following
2 below trend yields, which is exactly NORMAL. :-)
My thoughts about seasonality and warm winters was more modest in scope- more thinking about if open rivers, transport, maybe feed conversion (that was an afterthought) had any impact on typical seasonal patterns. And I asked because I really don't know.
As to weather, somebody brought up 1988 yesterday and I am of the opinion that a year like 1988 would result in a national yield below 140 but that is like arguing whether Dimaggio or Williams was better- you can argue all night if somebody else is buying but you'll never solve it. And you'll never have a year exactly like 1988.
I tend to agree that the current warm pattern is long in the tooth and am looking for evidence to support it. SOI is falling some but still in la nina. My own observation (we'll see if I have the courage to act on it if it presents) is that weather tends to change sharply about 6 weeks after the 90 day SOI shift is extant.
If you want a 180 boomer- and a chance to sell it for a great price, it would be lovely for the pattern to continue shifting but the spring to be relatively dry, then shift by mid-summer. Also highly unlikely that it will present in exactly that way so I don't want to get locked into thinking anything.
And then there were two............
so there are now two individuals.............two individuals that are spewing 187................YET NEITHER ONE COULD FIND ENOUGH MARGIN MONEY FOR THE 164 or 14 challange...............
funny how that works.................
Re: trend line plus
I intend to wait and price the short crop I will grow this year, due to record heat and low rainfall in July, to about August or so. When you guys that have sold the 180 bushels ahead, for the $5.50 are scrambling to buy the contracts back at whatever price and terms you can get. As ninety cent corn quickly became almost $4 corn , back in the early 70's , so will $4 corn become $15 corn if a true shortage develops. You sell 180 bushels for $5.50, you grow 100, the market goes to $15, and crop insurance only covers you to $11.00 or so. Sounds like fun.
How much 2011 corn is actually available for the market? We had trains of new crop corn being loaded and shipped out in September from here in Minnesota at Chicago type prices to keep the pipeline going. This corn that is not going to magically reappear, and with the short crop, my prediction is a very wild ride this summer. And if South America is not coming through with the soybeans, we could see new highs in both beans and corn.
Not that I believe any of this scenario will actually develop, and not that I won't myself sell out of insured bushels way before $10 corn ever develops, but if corn would actually explode, you could go broke with forward contracts, even with insurance.
Re: trend line plus
And yet if you look at a historica price chart it will show for evey spike high due to a short crop (like last year) we have a period of time of declining prices. In other words "short crop long tail".