Market Thoughts
After spending this week on the phone the only image that comes to mind is one of a farmer circling his combine like a caged lion. Just itching to fill the quonset with that sweet aroma of spent diesel. The hour is near.
My intel (which is you guys) is suggesting a low average crop. Again, it seems that this year was a year of extremes and weirdness. It was either way too wet or too dry. However, almost everyone is having a better time than last.
Why This Matters
As we roll into a new season of marketing we need to examine a different picture. The growing season market is now behind us. Typically, this means that the extreme volatility will dissipate. However, I don’t think that will be the case. There is simply too much uncertainty in the global marketplace and political spheres for markets to remain calm. This is going to play an important part in your marketing strategy this year.
We need to ask whether or not we are in a bull market or bear market. Most of you are saying we are in a *#*&^@$#%^ market. Yes, you are probably correct but we still need to deal with reality and the cards dealt.
In my opinion, I believe this is not going to be a simple marketing year where you can bin it and forget it. I don’t believe this is the setup. Yes, prices could be higher in the spring, but I think the volatility will give some excellent opportunities before spring.
Another thing to consider is the balance between risk management and speculation. These prices are at all time highs. The drought premium is gone. The war in Ukraine is status quo. Also, look what happened to lumber and oil futures. What I’m saying is that we are not immune to market whims and global economic pressures. Consider, perhaps now is the time to look at the profit margin and decide if these profits are solid; then take some money off the table. Maybe even use that money to buy fertilizer.
Bulls and Bears
Canola
Sentiment: Neutral. Expect harvest pressure
Bullish: Average crop with extreme low ending stock. Vegoil demand is strong
Bearish: Soy crop is solid. Weak global economy
Barley
Sentiment: Neutral to slightly bearish.
Bullish: Limited import of corn. Average crop size. Solid demand.
Bearish: Less aggressive export program. Domestic demand could suffer.
Wheat
Sentiment: Neutral as global harvest pressure
Bullish: Globally the wheat crop will not meet trendline yields of production.
Bearish: Harvest pressure. Will China buy from North America?
Quick Chart
Upgrade your Grain Marketing
Check out the website @ insightag.com to learn more.
Feature Product: Market Defender.
Grain Marketing is quickly becoming one of the most important skills on the farm. Fortunately, most farmers already possess the basic skill set. Imagine how powerful those skills could be in the hands of a trained professional.
Over the years I have determined what grain farmers really need is a guide. Someone to help coach them through the selling decisions. ​
Like GPS for Grain Sales.
​
Successful farmers don't pretend to know everything, they just know who to hire.
​
When you need an expert, hire one.
Purchase Market Defender
Go to insightag.com click start now
Comments