I think a lot of you guys may or may not have hard all the big hype lately about cash grains and especially corn. Corn is again at a record high and we as farmers seem to be perched ready to make that big killing when we harvest this fall. heres a link http://www.cmegroup.com/trading/agricultural/grain-and-oilseed/corn.html but ...............be very cautious, this market has all the makings of major collapse as well. I was thinking this last monday that it was time to book for fall harvest and so I called the local ADM office and was told to sit tight for a while, no sooner that I hung up the phone, I hear on the radio everything is dependant on the weather, and with over 92 million acres planted this year (second largest in history i think) the weather is going to play the sole part in wether the farmers make that big cash out or if they go bust. soybeans are already volatile enough and dropping right now, and all it takes is timely rains and huge yields to close that deficit on the national corn inventories. As for myself......nope not gonna sit too much longer before booking I may not take the highest price, but then again I won't loose my ass either. As for why I'm writing about this, I recently talked to a man about tree and brush removal and he wanted to pay me at harvest time. I about went cold..........I said as nicely as I possibly could I would have to have payment as per contract due in 30 days. He agreed that those terms were fair and he'd be back in touch with me after talking with his banker. Well I may have walked away empty handed,............maybe not, only time will tell. but I just cannot see taking that kind of risk right now. This market is crazy and I know a lot of you guys really want to catch that rabbit rather than just eating on the carrot sticks, but....is a promise of "I'll pay in the fall" going to hold water if the market goes sour? Just something to think about......... And for the rest of the farmers out there I mean no harm to you either as I am one myself. I just think this time around we need to error on the side of caution. we need to make our purchases based on solid numbers and if you cannot bank role projects on 2or3 dollar corn then don't do it till you go your money in your hands.
Monte, I agree with you totally. I think I am ready to contract all of my soybean crop for fall delivery directly to the elavator. With these kind of prices a collapse in the grain market will be harsh when it comes. One thing to keep in mind however, is the unprecedented demand for grains, China now being a net importer is massive for us in agriculture.
Agreed, the world markets are deffinatly an important factor here, just wish I could make sense of it all. call me gun shy after what happened two years ago with the milk prices, but farmers cannot afford to get caught in yet another surprise ending. It affects all of our local communities and local industries. As for dirt work, I think ag has the ability to help pull that industry up out of the ashes as well, but we've all got to be very carefull and move in small baby steps towards economic stability.
A statement I heard a long time ago, you won't go broke taking a profit. We all like to buy at the low and sell at the highest, but very few do hit it perfect. It is a tough one and knowing how fast things can drop, a locked in profit may not be bad. Save a little as a hedge, if you want. Farming is one of the biggest gambles anyway, and it is one you have very little control over.
The Sad thing is that your gamblin on futures ....It dont matter if its Oil,Cotton , Beans whatever it is Futures that dictate price ....Watch what happens when Japan starts to rebuild from there troubles ..Mortar ,Steel ,Lumber will be twice what it is now ...Its Gamblin at its worst level.. Milk Prices .....just like fuel somebody made big money on the market futures ...Too many players with big money .. Oh one more thing before my blood pressure rises ...Simple fact We all gotta eat with out Farmin a nation wont survive ..Theres too much World level Corprations involved ..
Oh and one more thing to think about in the world of Farmin .... ADM ..Monsanto started out as chemical companies and got into the farmin business as a way to make more money ......The largest price fixin scandal in history had all these players involved ..MORE MONEY MORE CONTROL...
Im with you monte, I think all the commodity markets are too high right now. As long as we have good weather this year, I see the market falling flat on its face. I would certainly be locking a big portion of my production in right now.
Turbo: like a lot of guys here I'm seeing this from both side of the fence. It will be real good for businesses like dirt movers if it plays out right, not so good for cattle producers and feedlots and dairys that depend on corn purchases for livelihoods. Japan with their recent troubles is also a big wildcard, while my heart goes out to those in need, I'm constantly reminded of the troubles you guys/gals have had these last few years, and also those in the ag sectors. I'd just hate to see both industires go south again for the foreseeable future.