Aug 22, 2014
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Outlook Today

RSS By: Bob Utterback, Farm Journal

Bob Utterback has more than 26 years of experience and offers producers a disciplined approach to marketing.

Implications on corn after the August Supply/Demand Report.

Aug 14, 2014

In many ways, the USDA did many producers a favor by implying yields on the low side of expectations. Historically big crops grow so we have to assume yield will probably end up at the 170 to 171 level if no weather event is seen. So using the figures the USDA have provided us, if the corn yield is at 164.4 bushels per acre and input costs at $690.59 per acre, breakeven would be at $4.20 a bushel. In order to make 5% return on investment for this year’s corn production, one would have to have sold their production already at $4.41. The bear is here and for the time being not unless a weather event is seen in the near future, there is no reason for these markets to go higher.

Where does this leave the producer? Those who have to sell off the combine will be scrambling to find alternatives to enhance revenue. Many will say to themselves, I can handle one year of not making money but what if we are in a sideways to long-term bear market. What do you do?
Now, before harvest, is when one should be discussing marketing strategies and how to manage risk for the next several years. The bull was fun and producers loved the prices received for their production but now one has to survive the bear!

If anyone feels they need to put structure into their risk management decision-making and would like to discuss marketing strategies, call Bob or Laura (765)376-4476) or (1-800-832-1488). We will also try to answer questions in upcoming blogs and we welcome emails to laura@utterbackmarketing.com or utterback@utterbackmarketing.com.

DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION.

THE RISK OF LOSS IN TRADING FUTURES AND/OR OPTIONS IS SUBSTANTIAL AND EACH INVESTOR AND/OR TRADER MUST CONSIDER WHETHER THIS IS A SUITABLE INVESTMENT. PAST PERFORMANCE, WHETHER ACTUAL OR INDICATED BY SIMULATED HISTORICAL TESTS OF STRATEGIES, IS NOT INDICATIVE OF FUTURE RESULTS. TRADING ADVICE IS BASED ON INFORMATION TAKEN FROM TRADES AND STATISTICAL SERVICES AND OTHER SOURCES THAT UTTERBACK MARKETING SERVICES, INC. BELIEVES ARE RELIABLE. WE DO NOT GUARANTEE THAT SUCH INFORMATION IS ACCURATE OR COMPLETE AND IT SHOULD NOT BE RELIED UPON AS SUCH. TRADING ADVICE REFLECTS OUR GOOD FAITH JUDGMENT AT A SPECIFIC TIME AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THERE IS NO GUARANTEE THAT THE ADVICE WE GIVE WILL RESULT IN PROFITABLE TRADES.

On the road and I am trying not to get too bearish!

Jul 30, 2014

I have traveled from Lafayette, Indiana all the way to Minnesota and it is hard not to be any more of a bear than I already am. There was one spot from Demoine to Sioux City that was questionable and I was told that Sioux City had approximately 20 inches of rain during the month of June implying why the crops looked the way they did.

It all comes down to weather. In my opinion the crop is out there. The rain forecasted next week would put this crop at ease. Between now and September 1, I have to suggest for those who have not sold or sold very little production to get it sold because the only way we are going to see $5 corn again is if there were an early frost. If no frost is seen by the 15th of September, I feel those who have production unsold have to store until spring.

If anyone feels they need to put structure into their risk management decision-making and would like to discuss marketing strategies, call Bob or Laura (1-800-832-1488). We will also try to answer questions in upcoming blogs and we welcome emails to laura@utterbackmarketing.com or utterback@utterbackmarketing.com.

DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION.

THE RISK OF LOSS IN TRADING FUTURES AND/OR OPTIONS IS SUBSTANTIAL AND EACH INVESTOR AND/OR TRADER MUST CONSIDER WHETHER THIS IS A SUITABLE INVESTMENT. PAST PERFORMANCE, WHETHER ACTUAL OR INDICATED BY SIMULATED HISTORICAL TESTS OF STRATEGIES, IS NOT INDICATIVE OF FUTURE RESULTS. TRADING ADVICE IS BASED ON INFORMATION TAKEN FROM TRADES AND STATISTICAL SERVICES AND OTHER SOURCES THAT UTTERBACK MARKETING SERVICES, INC. BELIEVES ARE RELIABLE. WE DO NOT GUARANTEE THAT SUCH INFORMATION IS ACCURATE OR COMPLETE AND IT SHOULD NOT BE RELIED UPON AS SUCH. TRADING ADVICE REFLECTS OUR GOOD FAITH JUDGMENT AT A SPECIFIC TIME AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THERE IS NO GUARANTEE THAT THE ADVICE WE GIVE WILL RESULT IN PROFITABLE TRADES.
 

Corn and Beans Look Good, Markets Choppy!

Jul 16, 2014

It only mid-July and these crops look great. Here in Indiana just south of Lafayette, corn is above shoulder high, tasseled and the ears filling. Soybeans are looking good but could use some heat and that is exactly what they are going to get. Many producers are suggesting their yields are going to be the best they have seen in years. So why is the market choppy?

It is still early to put in lows and while we may be of the assumption the crop is out there, right the moment one could assume the market is adding some weather premium. The weather forecast for next week is for heat and dry weather. This is typical around this time of year but if the heat were to last longer than trade expectations, the market is adjusting. For those of you who do not have all the sales done you would like, this week could be an opportunity to get some sales made.

If anyone feels they need to put structure into their risk management decision-making and would like to discuss marketing strategies, call Bob or Laura (1-800-832-1488). We will also try to answer questions in upcoming blogs and we welcome emails to laura@utterbackmarketing.com or utterback@utterbackmarketing.com.

DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION.

THE RISK OF LOSS IN TRADING FUTURES AND/OR OPTIONS IS SUBSTANTIAL AND EACH INVESTOR AND/OR TRADER MUST CONSIDER WHETHER THIS IS A SUITABLE INVESTMENT. PAST PERFORMANCE, WHETHER ACTUAL OR INDICATED BY SIMULATED HISTORICAL TESTS OF STRATEGIES, IS NOT INDICATIVE OF FUTURE RESULTS. TRADING ADVICE IS BASED ON INFORMATION TAKEN FROM TRADES AND STATISTICAL SERVICES AND OTHER SOURCES THAT UTTERBACK MARKETING SERVICES, INC. BELIEVES ARE RELIABLE. WE DO NOT GUARANTEE THAT SUCH INFORMATION IS ACCURATE OR COMPLETE AND IT SHOULD NOT BE RELIED UPON AS SUCH. TRADING ADVICE REFLECTS OUR GOOD FAITH JUDGMENT AT A SPECIFIC TIME AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THERE IS NO GUARANTEE THAT THE ADVICE WE GIVE WILL RESULT IN PROFITABLE TRADES.
 

Looking Ahead to Friday’s Crop Production Reports

Jul 09, 2014

What is the old adage "Rain Makes Grain" and looking out the back door with today’s rain, the crop looks good. Corn in many fields is beginning to tassel, above shoulder high and looking to be a great crop. Many in the trade are guessing yields this fall could come in above 162 to 167 bushels per acre giving the United States a carryover above 2 billion. Demand is already becoming weak and the potential for a good global corn crop implies the corn prices have no reason to bounce. The only reason would be dry weather in August, the potential for an early frost or a reduction in acres planted in Iowa or Minnesota.

Many producers are already facing a good crop and the new crop cash price below the $4 level hoping for a bounce into harvest or after the bins doors shut. The only problem I have with that scenario is what if everyone has a decent crop and demand continues to stay weak through the end of the year and throughout 2015.

Now is a time to reflect and decide where your bottom line is as to what price is break even for corn and how to enhance revenue if the cash price does not cover the input costs. The next few years without an event to spark the prices higher, is going to be difficult at best when it comes to pricing your crop. At this time, those of you who have long puts in place could roll down and take some of the profits in corn and wait for buying strategies on the lows to start the 2015 marketing season.

If anyone feels they need to put structure into their risk management decision-making and would like to discuss marketing strategies, call Bob or Laura (1-800-832-1488). We will also try to answer questions in upcoming blogs and we welcome emails to laura@utterbackmarketing.com or utterback@utterbackmarketing.com.

DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION.

THE RISK OF LOSS IN TRADING FUTURES AND/OR OPTIONS IS SUBSTANTIAL AND EACH INVESTOR AND/OR TRADER MUST CONSIDER WHETHER THIS IS A SUITABLE INVESTMENT. PAST PERFORMANCE, WHETHER ACTUAL OR INDICATED BY SIMULATED HISTORICAL TESTS OF STRATEGIES, IS NOT INDICATIVE OF FUTURE RESULTS. TRADING ADVICE IS BASED ON INFORMATION TAKEN FROM TRADES AND STATISTICAL SERVICES AND OTHER SOURCES THAT UTTERBACK MARKETING SERVICES, INC. BELIEVES ARE RELIABLE. WE DO NOT GUARANTEE THAT SUCH INFORMATION IS ACCURATE OR COMPLETE AND IT SHOULD NOT BE RELIED UPON AS SUCH. TRADING ADVICE REFLECTS OUR GOOD FAITH JUDGMENT AT A SPECIFIC TIME AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THERE IS NO GUARANTEE THAT THE ADVICE WE GIVE WILL RESULT IN PROFITABLE TRADES.

 

Looking Ahead to Monday's USDA Reports

Jun 27, 2014

The grain markets closed mixed today, the last full day of trading before the Actual Acreage and Quarterly Stocks reports due out on Monday at 11:00 am Central time. The USDA has surprised us so I would assume Monday will be no different. I look for a bearish tone in the soybeans with the potential for increased stocks and acres. In my opinion, corn also has the potential for a slight increase in acres. One could assume that shortly after the midday reports, the market will revert back to weather and if the afternoon Crop Progress Report will show any deterioration.

I would assume that everyone has placed their hedges and waiting to see the final numbers. Rain makes grain and one must assume that in many areas pollination will come early and not unless we continue to see more wet pockets throughout the Midwest the potential for a large crop is there. We will post our thoughts and recommendations on Monday after we have reviewed the numbers.

If anyone feels they need to put structure into their risk management decision-making and would like to discuss marketing strategies, call Bob or Laura (1-800-832-1488). We will also try to answer questions in upcoming blogs and we welcome emails to laura@utterbackmarketing.com or utterback@utterbackmarketing.com.

DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION.

THE RISK OF LOSS IN TRADING FUTURES AND/OR OPTIONS IS SUBSTANTIAL AND EACH INVESTOR AND/OR TRADER MUST CONSIDER WHETHER THIS IS A SUITABLE INVESTMENT. PAST PERFORMANCE, WHETHER ACTUAL OR INDICATED BY SIMULATED HISTORICAL TESTS OF STRATEGIES, IS NOT INDICATIVE OF FUTURE RESULTS. TRADING ADVICE IS BASED ON INFORMATION TAKEN FROM TRADES AND STATISTICAL SERVICES AND OTHER SOURCES THAT UTTERBACK MARKETING SERVICES, INC. BELIEVES ARE RELIABLE. WE DO NOT GUARANTEE THAT SUCH INFORMATION IS ACCURATE OR COMPLETE AND IT SHOULD NOT BE RELIED UPON AS SUCH. TRADING ADVICE REFLECTS OUR GOOD FAITH JUDGMENT AT A SPECIFIC TIME AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THERE IS NO GUARANTEE THAT THE ADVICE WE GIVE WILL RESULT IN PROFITABLE TRADES.

 

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