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Nebraska | Tara - I read Market Talk quite consistently to get a feel what others are thinking, but seldom post.
Tara - (you posted this a few weeks ago)
"I'm with sat here why worry about it at this point the Market will at somepoint put New crop premium back into corn to get the farmer to plant 99 MA I think you will have another chance to sell $6.50 corn, but I would not wait once you see it to get what you want sold.
I your looking for a marketing play -- try this on for size Instead of spending the money on Options use a spread trade go Short July 13 and long Dec. 13 corn, this is currently a -1.05 ish area. If we have a weather problem Dec. will gain on July allowing you to capture the Inversion, and also getting you your shot at $6.00 + corn. With this "play" you will know by Friday if you will get killed being short/long the two crops ( If on friday the USDA comes out with some wildly bullish old crop numbers than maybe old crop goes limit up but it will drag up new crop because they will then need every acre of the new crop and good growing weather) If the report showes that demand has been hurt then old crop falls, but we still have weather premium to worry about on new crop. The Kicker to this play is that one can be reasonably confident that Ethanol plants will not pay a $1.25 Inversion premium to grind old crop vs shutting down early for Maintance, and waiting until the early new crop is available.
For the last 5 years the Inversion has all but gone completely away in the old/new crop years, netting those that have done this over a $1.00 plus per bushel almost every year. And if you had done this in the middle of the hyperbol of the weather scares you would have done even better.
There will come a time when this play does not work, but that time will be after the majority of farmers are trying to do this and the long only funds are out of our market.
If this paly would have been done early this fall your price at this point could be over $7.00 net and still can be with some due dilagence.
For the record - even if I had nothing sold at this time, now is not the time to sell IMHO" (end quote)
- the spread is currently at $1.42 - do you feel this is a market play at this point or can we hit +$1.55 again? Curious what everyone's thoughts are.
Edited by gs84950 2/1/2013 01:12
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Tara Farms?
