However, it has resulted in the ‘good problem’ of having to market more bushels than originally planned. The CFC origination team is willing to assist you in getting these additional bushels marketed using marketing alternative such as minimum price and basis fixed contracts. These can be solid choices versus Delayed Pricing contracts, and allow you to take some of the risk out of the pricing equation.
We have a key USDA report coming out today, Friday September 30th, in the form of the Quarterly Stocks Report. Average trade estimates for Old crop corn stocks is 1.754 billion bushels. Old crop soybean stocks estimates are pegged at 201 million bushels. These figures would be a stocks build year on year from the September 2015 Estimate. While these numbers will get some attention, right now it’s all about the potential record large supply hitting the market, and how the pipeline handles the logistics of the same in an efficient fashion. I believe that we have potentially priced in a lot of the bearishness that is associated with a record large corn and soybean crop. The one X FACTOR that could be problematic to prices, specifically to soybeans, is the long position the funds currently own in that market. From a chart perspective it seems like the signals are also pointing to the fact that we have seen our lows in these markets. That is not to say that we will not try a retest of the lows, but I think we will be hard pressed to pressure the market further than what we have already seen.
Regardless of what happens in the coming days and weeks, know that you can call your CFC originator for information on alternative contracts, and to discuss a marketing strategy that fits your operation and manage price risk. We appreciate your business and we wish you a safe and successful harvest.