East Central South Dakota | Sat! there is no doubt our markets are ALL ABOUT MONEY FLOW. I agree on we need some more events as the shorts are in a great equity position, this is a given. The hard part is the "Future" part. As some on this sight are quick to point out in a bearish report when we as farmers are complaining, "these are the numbers we have and what we will trade." 2013 production is set. Two major talking points to me.
1. The shorts are in a dollar plus equity position. As a fund manager knowing production is set in stone and demand is a fast moving target ----do you defend your position or do you BANK YOUR EQUITY. To me more upside risk than downside gain as a short. The fund managers just need a calm exit----the producer needs a stampede. Greed will be our friend on this.
2. As u correctly stated the corn market dynamics have changed. To the producer that has physical commodity to move ---the market because of fund volumes on the short side looks dysfunctional. The farmer is sitting with good cash and equity just like the short funds. This MAKES CORN A BASIS MARKET. BASIS will have to do the work, which doesn't help u and me as well because of were we live. Regardless of fund net shorts---animals have to eat, ethanol burned and exporters fed. Basis will be the "hot shot" to get the herd to sell.
EDIT-----if the funds do run for the door and we get a good move futures, basis will weaken.
Edited by white shadow 1/11/2014 19:34
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you reckon ...US Farm Report
