Jul 24, 2014
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Current Marketing Thoughts

RSS By: Kevin Van Trump, AgWeb.com

Kevin Van Trump has over 20 years of experience in the grain and livestock industry.

Bullish Talk to Bring More Corn Acres.....

Mar 17, 2014
Corn is starting to go in the ground in the Southern parts of the US.  Producers in Texas, Mississippi, Louisiana and a few other states are reporting that the planters are rolling...though some 1-2 weeks behind last years pace.  It sounds like more old-crop bushels have changed hands the past couple of weeks and the "basis" in many locations is starting to more aggressively weaken.  I have this strange feeling the recent $0.80 cent rally in corn prices and renewed "bullish talk" might just prompt US producer to roll out more corn acres than the trade has been anticipating. It will certainly be interesting to see how the acreage estimates play out in the coming weeks.  My fear is the initially USDA survey estimates (out at the end of March) may be too low, as producers views towards corn has somewhat changed, meaning the total planted corn acreage number may ultimately works itself higher rather than lower in the weeks ahead. As for South America, I am hearing more talk that Argentine corn has become more competitive globally with US corn, and that the recent harvest is picking up pace and more bushels are starting to make their way out the Argentine ports. Brazil production still remains somewhat of a mystery as second-crop corn acres and production is still suspect. As of right now the trade guess in regard to Brazilian corn production is still extremely wide at between 65-75 MMTs (USDA currently at 70 MMTs). Bottom-line, corn exports out of Ukraine remain in question, but exports out of Argentina are starting to create more competition for the US. There is also talk that the recent rally in price might not only prompt more second-crop South American corn acres but also more US corn acres. Obviously US weather and planting conditions will remain a concern and major determining factor.  I continue to believe the market could go in either direction right here and like my position of being 50% sold/hedge in regard to my new-crop estimated production. Spec players may want to start thinking about building various types of small "Long Corn vs. Short Wheat" positions (JUL14) as wheat premiums now exceed $2.00 in relationship to corn.  CLICK HERE for my daily report...... 

 

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