Open HouseDate: October 27, 2017
Join us as we celebrate the new partnership between Key Cooperative and LRI.
The USDA continues to project a huge corn carryout and what would be nice to know is who is going to carry over these bushels and where are they going to carry them over at? The easy part of the question is most of the bushels will be carried over by the producer. But after that it gets a bit dicier as will they be carried over on the farm or in commercial storage which is less of a factor than which area of the country will those bushels be carried over in?
Along with these questions we need to also ask how big will the crop be and where will the problem areas be. That problem may be a weather issue that cuts the yield or the lack of a weather problem and then the extra bushels adding to the existing carry over and additional storage shortage. Keep in mind that commercial storage cannot be emptied out without producer’s selling and selling soon enough to logistically get those bushels moved. We have seen it before where late July, August, and early September are like a mini harvest time with the volume of grain moving.
So then it is a matter of just how much can be physically moved out to the market whether it is by truck or rail. Hey it is no different this year than it has been in the past when we had large carry outs. That is why we are looking at storage alternatives at some of our locations.
Price wise thank goodness for the Funds wanting to rebuild their long positions as it has helped the markets move back up for now at least.
When you have a beast like the Funds and an appetite for buying like they have had it would be wise to keep feeding the beast. You don’t have to founder it by overfeeding it but don’t sit back and starve it. Because if it dies or decides to move to greener pastures this move will be over, unless we would have a weather problem.
It may look like the cartoon for the stock market only it would be the corn market.
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