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vrbuck
Advisor

weekly inspections and Hammer Marketing

this week the inspections came in at 17029 far short of the 31500 per week needed to make the wasde export projections.  In fact the inspections havent made projections for months.  Some like to taught seasonal progress in inspections or last years export projections and compair it to this year.  I say hogwash,  exports and inspections are lagging because why take delivery now,  if you wait,  it will get cheaper.  Accumulative inspections is only at 1,238,365 far under the projected pace needed to make the WASDE numbers. 

 

http://www.ams.usda.gov/mnreports/wa_gr101.txt

 

At some point in time the Wasde numbers are going to be udjusted to this fact.

 

Since we are on the subject of future government reports my feeling is that the june 30th report will be the most improtant bearish report in a long time.  I feel with the open winter and dry spring there will be another 2 to 3 million more acres found for corn and beans then what is currently being traded.

 

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6 Replies
Buckley_HF
Senior Contributor

Re: weekly inspections and Hammer Marketing

"udjusted"?. And it's actually June 29th. Basis keeps getting hotter. Futures market is becoming worthless. I'll watch cash market. Thanks buck
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GoredHusker
Senior Contributor

Re: weekly inspections and Hammer Marketing

FWIW, USDA did adjust exports downward by 50 million bushels yesterday.  If memory serves me correctly, USDA stated we'd plant somewhere around 95.8 million acres of corn in the March report.  Are you implying we planted around 98-99 million acres of corn?  I highly doubt it.  I read where a lot of analysts believe USDA put ending stocks of the 12/13 soybean crop at pipeline because they're going to have plenty of added acres of soybeans to work with after the June 29th report. 

 

If I was an importer of corn, I probably wouldn't be taking any corn either.  For one, the price has gotten cheaper.  For two, Brazil's corn is cheaper than ours.  With the things they let foreign buyers get by with, I'd cancel my higher priced corn purchases from the U.S. and buy Brazil's if I had the flexibility to wait until August when most of Brazil's will get shipped.  As long as Helicopter Ben keeps the printing presses idle, our corn will continue to be higher than Brazil's.  As Europe burns, the U.S. dollar really only has one way to go unless the Bernank unleashes another round of juice. 

 

I don't have much old crop left, approximately 5000 bushels.  I probably won't sell it anyway as I'll more than likely have to wean my calves early due to drought, therefore needing it to feed.  However, I believe it would be prudent to move old crop corn before August 1st.  I have no idea what the margins are right now grinding corn for ethanol, but I'd guess with the way the basis game is being played that ethanol plants sometime later this summer will be able to make more money selling corn inventory into red hot basis than grinding it for ethanol.  Once this happens, the basis game is over.  If we've learned anything over the years, it is that rumors cause and squelsh more rallies than reality.  Anyone remember back in 03/04 how soybeans were headed for the teens until Bunge mentioned something about importing beans from SA?  There will more than likely be rumors of importing corn into the U.S. come August from Brazil.   

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vrbuck
Advisor

Re: weekly inspections and Hammer Marketing

Look at the total acres between now and 08 we have takenmore out of CEO yet crop acres have gone down I believe they will be foundrp
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GoredHusker
Senior Contributor

Re: weekly inspections and Hammer Marketing

According to the June 30th Acreage Report in 2008, we planted 234.55 million acres to corn; soybeans; wheat; and cotton.  According to the March 30th Prospective Plantings Report in 2012, we are expected to plant 238.9 million acres to corn; soybeans; wheat; and cotton.  This is 4.35 million acres more than 2008.  I do not see a reduction of crop acres.

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vrbuck
Advisor

Re: weekly inspections and Hammer Marketing

You read a different report then me total crop spread and for from the report I read is a 8 million difference I use some windage to get the 2 to 3 million.
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sw363535
Honored Advisor

Re: weekly inspections and Hammer Marketing

Windage-------------an appropriate term.

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