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| well based on what just rolled through here again........and a pretty large portion of some major corn acres..........everyday brings us a little closer............
we have all kicked the intervention idea around for several months.......so its not a new idea.........however about a month ago it become a real possibility IMO........that said I honestly thought that the government had a little more backbone and would keep things inflated, but maybe they are tired of the party with elections coming up..........that said they don't even know what their policies should be, let alone their effect, so its like watching two drunks play golf, a lot of swings with very few balls landing on the green.............
a couple of weeks ago it become evident that maybe the right move was to protect some 2012 and even 2013 if you are concrete enough in your future plants...........leave 2011 somewhat open for a summer spike..........and if you have 2010 you should have been scaling into that for sometime............
2011 production cost are in the bag and 2012 is close enough that at today's levels you will still make some bank...........if prices remain high land will likely tick up some, chem and seed alittle too, fert is for sure going up....................so if you hedge some inputs you will likely be fine, and if you don't probably still just fine..........
as far as strategy, its a matter of what you are comfortable with in relation to your physical..........obviously that is the first thing you want to protect, yet you have not grown it yet.............also, if you are looking to play alittle more than just production that will change things up a bit too...........so it may be a combo of forward cash or futures contracts (some use HTA, although not sure those are much fun) with some puts on the above and beyond production comfort level...........as for timing on all of this...........I would probably keep a close eye on DC this summer and the markets............June can be a tough time to sell because the crop is usually in and looking pretty good so you get some market fade that doesn't do much unless we get a weather scare before harvest...........I think you still have time..........use that to avoid some of the roll............and if intervention doesn't happen I would imagine 2011 still has room to run..........like I said 2012 and 2013 might be the ones to think about first...........
I think if anything comes about, especially after today's brush, it will be later in the year.............and I really do think the trade will wake up to that fact at some point that this crop is not near what they said it needed to be...........the June 30th report will hit about the same time as the MO river basin is in full fledge flood control............might be some opportunities coming to spike a top and get some protection on............
sounds like you are pretty much doing it right..........and based on your comment's are doing great.............I hope some others chime in too, some good strategy guys on here..........as for shorting this market, you better have the physical to back it or know intervention is a guarantee............
If and when this market goes, it will be a ball of fury.............a lot of funny money are short or wanna be short this thing............think SLV, went from 48 to 32 in a matter of days..............
Edited by Mizzou Tiger 6/15/2011 02:47
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corn market.
