Aug 23, 2014
Home| Tools| Events| Blogs| Discussions| Sign UpLogin


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.

Good growing conditions!

Jun 07, 2010
The corn and bean markets are reflecting good growing conditions and bearish outside markets. While beans did take out a few shorts yesterday, the bulls could not hold the ground gained and gave it all back today. It’s widely assumed that limited supplies of old-crop beans exist. The crushers want beans, but if they have to bid up too much, they will simply shut down due to poor profit margin and for planned yearly improvements.
 
Outside markets continue to be very negative, with the Dow close to 10,000, and the dollar was up. The jobs outlook today did show overall growth, but it was primarily in government workers, which is short-term. The private sector added a very anemic 41,000, which is hardly a sign of robust economic growth. While these numbers are concerning, the big uncertainty continues to be how deep the European debt crisis will get and its potential negative impact on China and India, which are major trading partners.
 
Overall, our concern continues to be that supply in regard to corn and beans could easily be average to above expectations, while bullish demand prospects fail to hit the market due to a deflating global economy. Overall, this forces carryover up at a time when producers have limited new crop inventory sold and rather large supplies of corn and wheat on hand.
 
Implication for market plan. I am bearish but finding it very difficult adding new cash or futures sales after such a negative last few days. The market is clearly oversold and should bounce. I suggest now would be a great time to put in a bearish put strategy which protects most of the downside risk but limits your cash flow exposure if we get any type of hot and dry July/August weather event.
BEFORE TRADING, ONE SHOULD BE AWARE THAT WITH POTENTIAL PROFITS THERE IS ALSO POTENTIAL FOR LOSSES, WHICH MAY BE VERY LARGE. YOU SHOULD READ THE “RISK DISCLOSURE STATEMENT” AND “OPTION DISCLOSURE STATEMENT” AND SHOULD UNDERSTAND THE RISKS BEFORE TRADING. COMMODITY TRADING MAY NOT BE SUITABLE FOR RECIPIENTS OF THIS PUBLICATION. THOSE ACTING ON THIS INFORMATION ARE RESPONSIBLE FOR THEIR OWN ACTIONS. ALTHOUGH EVERY REASONABLE ATTEMPT HAS BEEN MADE TO ENSURE THE ACCURACY OF THE INFORMATION PROVIDED, UTTERBACK MARKETING SERVICES INC. ASSUMES NO RESPONSIBILITY FOR ANY ERRORS OR OMISSIONS. ANY REPUBLICATION OR OTHER USE OF THIS INFORMATION AND THOUGHTS EXPRESSED HEREIN WITHOUT THE WRITTEN PERMISSION OF UTTERBACK MARKETING SERVICES INC. IS STRICTLY PROHIBITED. COPYRIGHT UTTERBACK MARKETING SERVICES INC. 2010.
 
Log In or Sign Up to comment

COMMENTS (3 Comments)

Anonymous
With a bleak and dismal outlook on the prospect for good prices, would it be presumptuous to assume that gross income per acre may be lower in the years to come?
Should the topics of cash rent and land prices be standing on the sidelines waiting to be thrown into the game of "Big News"?
1:14 AM Jun 8th
 
Anonymous
Like everyone else in the business, Bob is waiting to make comment on the gulf oil spill until after the Pro Farmer Tour this summer. Always on the cutting edge of production agriculture, only the Pro Farmer Tour can accurately assess the status of the situtation of that commodity. Now be honest, am I too sarcastic?
11:03 PM Jun 7th
 

Receive the latest news, information and commentary customized for you. Sign up to receive Dairy Today's eUpdate today!

 
 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions