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| I received the first stox estimate last night estimating corn stox at 10500 which is slightly less than my home-made number & beans at 2240 & wheat at 1140..these numbers would put our carry outs at slightly under 200 for both wheat & beans and would be on target in my view for current price levels with what we know about demand at this point. Still gives us a potential 1.8 to 1.9 corn carryout contingent on rationing the balance of this crop year & which I view as an adequate supply.
The tricky part of any analysis for the rest of the crop year and as far out as 2010 is our consumption machine. The cattle herd is in strong hands. Same for poultry. While the hog herd is also in strong hands, how long can those fellows operate with a corn-hog ratio of 8.5...the pig crops are, in a practical sense, flat with last year & the consumer has chewed through an enormous amount of pork. If kill weights would decline 1 or 2 pounds I believe the hog prices could stabilize & even improve. The additional item which needs to be analyzed is the livestock consumption in other parts of the world; livestock liquidation, of which there is no evidence of yet, is a significant consideration for prices down the road.
In May of 1974 the sow kill began to increase sharply, in the third quarter of 1974 cow kill began to increase & of course we saw the big liquidation continue thru 1976.
A different structured industry now & is something I want to review when I return home.
Crude oil prices are also a consideration as it effects the available consumer funds. I know I have posted this link before, but over the years I have found these folks to be first class when evaluating the economy.
http://www.bcaresearch.com/
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Early thoughts.
