The Optimism of a Farmer
Perhaps the quote from Will Rogers best speaks to the nature of my optimism for the past 3 months of Sundays -
The farmer has to be an optimist or he wouldn't still be farmer...
Farm income - So much for optimism, did USDA not read the above from Will Rogers? Frightening how quickly income has eroded in just over three years. Net Farm Income...
Fertilizer - Another article similar to last week's, a silver lining perhaps due to fundamental economics - the impact of shrinking planted corn acres for 2017.
Markets - USDA/WASDE released their monthly report this past week and many industry analysts were left scratching their heads. Typically, the February report trues up corn and soybean numbers - hello, exports are at or near record levels for beans and corn plus ethanol production is at record level. I have a theory, it includes the grassy knoll...
Meanwhile back on the floor, hedge funds maintain their love affair with beans and selling of wheat - currently the trade is short just under 100k contracts of SRW. South American corn and soybean production estimates continue to be increased. Wheat futures were at prices not seen since last July, perhaps signaling a paradigm shift in the market.
Wheat production was finally cut for India by USDA; increased wheat imports and purchases could no longer be ignored. The imposed import tax on wheat is currently off. Mr Art Douglas shared that the Indian weather has been very favorable for their 2017 crop - in a couple of months, we know quantity and if they can successfully get a quality product in the bin.
Projected prices - Spring commodities have completed their first full week and 1/3 of the period is complete. The table below is a summary of where the average is as of Friday's close. Dpea price types are not announced until early March, all finals will be known at the same time.
Projected Price Trending
Barley $3.40 up
Canola .175 flat
Corn 3.96 up
Soybeans 10.20 up
Weather - I listened to the forecast from Art Douglas last week in Spokane for the coming year; at present, there were no areas of weather concerns for world wheat production, China and India were said to be in pretty good shape for moisture. Mr Douglas showed a warm mass of water that has formed off the coast of Peru that will influence our weather patter for the near term - El Nino rises again, hot and dry harvest predicted. Our region can expect warmer than normal spring temperatures with precipitation anticipated to be normal to less than normal, but first we have to get through February.
Southern plains were very dry this fall going into winter, not the best wheat crop out there and many acres are expected to be grazed this spring due to price and quality of the stand. This weekend had a heat wave hit the Southern Plains with temps well into the 70's, some upper 80's and low 90's. Insult to injury, a winter storm warning for Eastern NM and the Panhandes of OK & TX - oh it's good to be a dormant wheat plant this year! A good read from KS on conditions there shared by Kevin Duling of KDI, thanks Kevin.
Until next time...
The integrity of men is to be measured by their conduct, not by their professions.
~Sir Phillip Francis
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