West Central MN | deereman - 1/11/2008 16:16
I just can't help but think we are going to lose demand here at this level real fast.
Actually, that is the reason why we are at $5.00 corn. The market is trying to find a way to slow down demand and it doesn't seem like we have reached it yet. It has been interesting watching the last couple of years as everyone has said that $3.50 corn will kill demand. Ok, $4.00 corn will definitely do it. Ok, who can make money at $4.50 corn???
Nothing has been stopping this train yet, but we must be getting close. It is true that the market has stopped alot of ethanol plants which were slated to begin construction this year. I think anyone would be nuts start building a plant at this point.
Just got the Annual Report for an ethanol plant which I am invested and for 2007 the plants profit would have been almost 12 million if they were not building a gassification project on site. Even with paying for the project, they still made about 3 million. That is with an average corn price for the year of almost $3.50 I know alot of people who still have contracts for around $3.00 to deliver yet this summer and some new crop sales which are not much higher.
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Your thoughts on 5.00+ corn
