Posted 10/18/2020 08:37 (#8551317 - in reply to #8551288) Subject: Derecho marketing. “When the wind blows your hammer away..”
I pretty much agree.. 2020 has been quite the year..
Reposting from below as I believe this is a good summary from my area.. 2020 the perfect bullish storm.
Wow what a fall campaign..
We’re in a unique year where big demand for exports.. China on soybeans and sorghum.. plus end users not filling up before harvest... because the USDA reports hinted at almost 3 billion carry outs for 20 Corn... all contributed to a market turn around.. like an Iowa wind storm.
End of July Early August the local ethanol plant here was like 15 under.. which is weak for us.
“Big Crop coming.. y’all ain’t gonna be able to hold it.. values will become cheap as farmers puke it.”
“Y’all just want to buy sub $3 corn.”
“That’s the plan.”
So.. we walked across the street.. farther than that but figuratively saying to the feedlot.. new manager came from Tx panhandle.. serious about buying corn.
“You know when the time to buy corn is? The time to buy corn is when it’s FOR SALE”
He wanted to put up the most high moisture corn (HMC) they have ever done..
Being the suckers we farmers are.. “well alrighty then.”
So we started hauling.. feedlot was 15 over.. paying 3.40..3.45..3.50 at the time.
Ethanol plant got scared so they went to 15 over..
About this time China started making news.. Soybeans started going higher..
Sorghum went from like 3.80.. to.. over $5.00 a bushel as of last week. 5.12 at shuttle loaders.. 1.10 over.
All developed shortly after the wind storm hit Iowa.
The feeding frenzy is on!!
Another feedlot conglomeration is reportedly chasing corn at 50 over..
.. and the new ethanol plant down by Wichita is pushing.. 35 to 40 over.
Everyone was chasing grain from the mom and pop feed store to the feedlots and ethanol plants to China.
Now enough has been tucked away in storage that rail import values will probably set the tone.. for prices here and to our west.. plus the drought. Selling has basically dried up. Or is not sufficient to meet demand.
Flip side is that ethanol values are not so hot.. and demand will probably under perform there..
Feedlots.. are full of cattle.. with limited pasture Options given the dryness.. wheat isn’t even out of the ground.. more or less big enough to graze.. so feedlot demand for feedstuffs should remain stout.
Sorghum yields are all over.. places with good rains are busting 115.. 130 yields.. not too far away places which never got enough moisture are.. struggling to make 50 bushel full season.. 35 bu double cropped behind wheat.
... then there’s wheat.
Storage was kind of tight for 20 crop.. we thunked that would carry over to this fall.. see above.
It really hasn’t.. now producers are wondering when their 21 crop will emerge.. hopefully before Christmas..
A lot.. probably will not fully emerge until we get moisture. We’ve got a shot.. better to our East of precip in the 6 to 10 day..but the 8 to 14 flips back to dry.. but hints at a pattern change.. gonna get cold that’s for sure.. so “not looking promising” for emergence.
Just when you think you’ve seen it all.. along comes 2020.
How long will China buy?
How bad is ethanol demand?
How bad is this drought?
What about a reflair of Covid?
... maybe the packers will not be in the drivers seat this time... so you want cattle eh?
Did you bring your checkbook?
Until the drought breaks.. things will remain tight.
Golly I needed that hammer from hammer marketing.. guess the wind blew it away.