OFF TO THE RACES

[Hobbyfarmer]

My brother called me yesterday morning (over the road trucker) said he was in southern Ohio and had come from Indianapolis area and from there to southeast Ohio the beans were short and the corn in his best guess was short and very uneven.

Looks like a narrow band of rain on the radar out there now.

This heat and lack of rain in most places with these hot night time temps has to be taking a little of the a"bloom" off the top end yield doesn't it?

The overnight market is up ...16 on corn a bit ago. A 20% cut in real production in half the corn belt might be disastrous to the livestock industry and our future markets if we see $8 ish corn for the next year or so.

Started hauling corn yesterday and it needs out of the bin...this heat and humidity is going to take it's toll on bins of corn if the owner(s) don't stay on top of it. RUN YOUR FANS and check them daily...TOO MUCH MONEY OUT THERE TO NOT CHECK IT OUT REGULARLY.

I've sold more bu of beans under $7 than corn over $7 to date.

[jdmax]

The rain finally stopped here the last week of may and alot of acres went in the ground over a 10 day stretch. Those fields that were planted when ground conditions were alittle heavy are the ones that are uneven, and they all are a month + later than normal.

just got a nice little shower after missing one yesterday evening

[Hobbyfarmer]

Talk on the radio farm program this morning of a 1 bu average decrease in Ill in oies corn yields because of this warm spell.

[Hobbyfarmer]

This is Beth Collins:

July 20. 2011 Here we are in the middle of summer, and in the middle of a weather market.
Each new forecast will cause a new ripple in the price of the futures. I would remind you that
often summer rallies are either three weeks or six-seven weeks in length. The short rally is
usually caused by a "scare", but not an event that actually can cause enough damage to seriously
hurt production. The longer rally is if the problem is really going to lower the production supply.
First of all, this heat is going to impact the corn market the most, as it is going through the
critical pollination stage. The effect to the soybeans will get more attention as we get into the
early part of August, and beans are in their important reproductive stage. Either of the "weak
sister" grain will get some benefit from the stronger one, and what ever direction we are moving.
The low for corn was made at the beginning of July after the huge drop in prices caused by the
quarterly stocks report and the acres report. That means that the three weeks would be up
at the end of this week. As I read the different weather guys, I am inclined to think that the
heat is not going to go away. Many are expecting August to be hot as well. The next week or two
will be critical as to who gets the rain and how much when the "heat ridge" moves out for a few
days. As you look at the drought monitor maps, you can see the areas that have missed the
rains this past month, and are now in need of moisture to avert problems with production.
The other concern I have is that we are seeing the same problem that hurt our corn yields
last year...the temperatures during the nighttime have not cooled down enough to let the
corn plant rest. It is my contention that this is what caused the much lower yields than
many had been expecting last fall. I guess I am not sure if we are seeing this during the exact
same time, but it does not appear that we will NOT be getting any cooler for a while, so the
corn will continue to struggle. If we are in the stronger 6-7 week rally, I would just
pick the date of Aug. 18th to mark on the calendar and be aware of the importance of
the timing. Even when the crop is actually damaged and we have rallied up hard, you
have to remember that the markets are like people, and it takes energy to continue to
move. It seems that after the 3-4 weeks, the market just runs out of energy to go
any higher, even if the news is very bullish. So you need to have your marketing
plan thought out and your target prices established so that you don't miss the
opportunities. Being at the end of the first three weeks is pivotal in timing, and we are
also at very pivotal prices. I am going to list below the major support areas for corn
and beans, the major resistance areas that we are at right now, and IF...IF we move
through that resistance, where I am guessing that we may move to for the next big
rally to continue the 6-7 week rally.

DEC CORN - the major support is at 6.60, and then 6.24. There is enough worry over the crop
problems and the supply with the old crop, etc. that I would not expect to drop too
far down for right now. The Pro Farmer tour is usually at the end of July, and then the
next important crop report will be on Monday, August 12. (the crop scouts will be
counting plant population, but they won't open the ears and count the kernels, etc. until
the Sept. crop report), the high on June 9th was 7.23. We are over 6.84, which is important.
and seem to be trading a wide range as we await the weather forecasts. IF...If...we move
over the 7.23, then the next target would be 7.99 to 8.25. Most of the record high prices
that we are watching were made when we were so strong in 2008, and Dec corn that year
traded up to 8.00. It would be my suggestion to atleast purchase put options to lock in a
price floor at either that price target, or the timing of the middle of August. It usually works
really good to have open orders placed, and then if the market moves quickly off any type of
news, you have a better chance of getting something done, rather than trying to react after
the fact. A reminder that the economy tanked at the end of 2008 into the recession, and
pulled grain prices much lower into the end of the year. It is so hard to actually compare
apples to apples between the different years, as there are so many variables anymore. We
are a world market, and the economies of the the European nations are going to affect the
investment of the commodity funds, as well as other influences such as the price of energies
and metals.

NOV. SOYBEANS - the major support is at 13.50 and then at 13.00. The pivotal number is at
14.00. The high from 2008 was made at 16.36. It seems that the old crop supply of beans is
not as tight as the corn situation, but we also had less acres of beans planted this year, so it
is very important to have a good yield this fall. The first area that I would expect to see the
market stop IF...If we get over the 14.00, would be 15.00. Again, we need to watch "price
and time". Take a look ahead at where the put options are trading, and determine how
much you are willing to spend per contract, and how many bushels you want to protect. Then
you can put in open orders just like the corn options. It is always emotional when we are
in a weather market, so having your plan thought out and get it implemented with orders for options,
or orders for cash sales with your elevator will help to keep you from getting carried away
by the bullish talk when we are at a high.

OTHER CONSIDERATIONS -- We need to be watching for any news on hurricanes developing.
This can cause a good rain to fall in the areas that are suffering the most right now from dry
conditions. Each Monday afternoon at 3:00, the govn. gives an update on the condition of the
crop. With the heat and dryness, the ratings have been moving lower. Be watching each
Monday to see what those numbers are. Right now the govn. has projected a national corn
yield of 158.7. Most analysts are saying that we need a minimum of 156 to keep our supply
from being critically low. So you can compare that to the guesses that we will be hearing
each week. Last year we came in around 152. The govn. soybean per acre number is 43.4. And I am guessing that anything under
a 42.5 would get us down to that critical supply number. I understand that the USDA is
going to resurvey the producers in the Dakotas, Minnesota, and Montana to get a better number
for the actual acres planted. This information could change the planted or harvested acre
number in the Aug. 12th crop report.

Well, I hope this info gives you something to measure the market and hopefully make some
profitable marketing decisions for your farm operation. When we get such big moves during
the day, I think it is important to make a "box" around the trading range. Look at the charts
and determine the recent high (resistance) and the recent low (support) and then don't get on
the emotional roller coaster of the day to day moves. Until we move out of the "box" in either
direction, the market is just reacting to the "noise" of the day to day weather, etc. Just have
your plan thought out for when we move out of the "box" in either direction. Pick price targets,
and pricing strategies (either cash sales, futures trading, or options). I also hope that all of
you who recieve this e-mail have crops that look great!! Is tough when the prices are jumping
all over the place, but is even worse when it is your crop that is struggling to produce a
bumper yield.

[Hobbyfarmer]

Corn lower on forecasts for better weather
Soybeans were mostly firm on technical buying and spillover from the lower dollar and firm crude oil. Most of the support came from Chinese demand with Beijing picking up 220,000 tons of new crop ahead of the open. Still, the forecasts for at least some improvement in weather limited new crop gains. Corn was lower on profit taking and speculative selling. Most forecasts for at least some of the Midwest late this weekend into early next week show less worrisome conditions. The wheat complex was higher on short covering, speculative buying and the lower dollar. The spring crop’s developing slower than average and there are long term worries about persistent drought in the Southern Plains. Also, there are increasing concerns about a hot, dry pattern in Ukraine and Southern Russia.