Sep 20, 2014
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EHedger Report

RSS By: Dustin Johnson

Dustin works with a wide net of large producers throughout the Midwest. His analytical market approach and objective hedge strategy development is specific to the needs of every individual.

EHedger Closing Grains Commentary 9/16/09

Sep 16, 2009
Dec 09 Corn
- 10 ½ 
Nov 09 Beans
951 ¼ 
- 8 ¾  
Dec 09 Wheat
468 ½
- 2 
Dec 09 KC Wheat
- 2 ¼
Dec 09 Min Wheat
500 ¼   
+ ¾  
Dec 09 Meal
- 4.3
Dec 09 Oil
- 0.16

              Corn, beans and wheat all closed lower. However, late day buying did move prices significantly off the lows by the close. The frost concern late next week continues to be the main focus of the market. The morning weather models had “a strong front that looks to bring chances for some frost and even some freezing temps in the northern Midwest by the second half of next week.” However, in the midday run the GFS took the cold air out of the forecast for the Midwest at the end of next week. In addition, the forecast does not see any cold weather threats during the 11-16 day forecast.
Obviously, the frost forecast is still a long way off. Eight days away is an eternity in terms of an accurate weather forecast. In between now and then there is a good chance the frost will be put in and taken out of the forecast numerous times. Overall, to see what type of damage, if any, the weather will actually do we will have to wait and see exactly how cold the weather gets and how far south the cold temps actually reach. Until that time, the market will probably continue to chop around and overreact to every model run. Either way producers need to remember that just last week December corn was trading 302 and November beans 892. Sure if we do have a hard freeze prices could go much higher. However, if this frost misses and farmers wait until they are sure the crop is going to finish up without a frost, corn and beans could easily be at new lows. Don't get me wrong, we would love to see corn and bean prices take off from these levels, but even more than that what we don't want to see is corn and bean prices take out the lows with farmers still holding large amounts of unsold grain. Therefore, we recommend… Please give us a call to discuss different strategies.  
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COMMENTS (8 Comments)

Let's not forget that over a year ago when Corn was $7.50 and Soybeans were $15.00, no grain company that I called would even take a Hedge to Arrive contract, or even take a Forward contract without protection. I can understand why (margin calls), but the fact is most of this 2009 crop would have been priced a long time ago!!! They changed the Rules in the middle of the Game!!! Much of this unpriced crop is their fault. Of course now they get to buy it cheaper. Don't reply back saying you could have shorted and all that crap. The way the market was moving, I would have lost my farm in 4 days on margin calls.
10:51 AM Sep 17th
As a producer Ive always felt like the peasant in the food chain. Prices always at or below cost of production. In 07-08 I thought oh my god, did somebody in government or grain trade finally figure out we arent making much of a profit for out toils. Now all of a sudden the attitude has changed again back to the way it was. Disparity low prices below cost of production. I think its fair to say if we gave all the corn away for 2.oo a bushel the cost of ethanol and food products would not come down accordingly. I dont know what the answer is but we are and always will be at the mercy of markets, which dictate whether or not we have a profitable outcome. And for some reason this year we have been told and told that this wont be a good year for farmers from the get go. Almost a preplanned outcome??????
11:59 PM Sep 16th


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