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| It's widely believed that as much as 600 + mln bushels were still out in the field by the end of USDA's weekly harvest reporting back in December.
I was a believer in a decent to large crop but admit that when 5% was still out in the field and suffering through this winter... ugh.. not going to be as much left when/if it finally gets harvested. We even had a field or two here in Ks that was waiting to dry down over the holidays.
Surely we've cut that unharvested crop down to... ??? Say 300 mln bushels.. but if you lose 20 to 50% in field loss that could amount to...??? 60 to 150 mln bushels.. say 90 mln average off of the current ending stoxs of 1719 starts to snug things up pretty tight. Granted there is still room to come off of exports.. but for that matter is there room to add to ethanol? Also the crop in the bin here is "pretty good".. still wet.. last load was still over 17%.. but the test wt was over 61 lbs.. there might be room for USDA to add bushels from here...although tw might subtract bushels elsewhere....???
Either way farmers around "my neck of the woods" are starting to sharpen their pencils on 2010 production costs.. We are not going to be as "gun-ho" to go raise bumper yields at $3.00 corn as we were last year with dreams of $6.00... just not going to happen.
It seems like leading economic indicators are still pegged out on a robust expansion.. which should impact demand from the consumer.. I even heard one guy talk this morning about unemployment down around 8% by the end of the year... (uhuh..???)
It appears that the wheat market is sick.. the supply change is structual as the Black Sea region has really ramped up to fill the market when we shot the moon two years ago... Exports are not coming back.. and even though acreage is down this year.. it still might add to ending stocks.
We probably need to shift a decent amount of acreage in the Southern High Plains from Wheat production (shrinking exports) to Feed Grains and the growing ethanol market. Grain Sorghum is a crop that may start to work for more producers in the Wheat, plow, Wheat rotation of the past 100 years... ??
As the economy continues to recover and the markets continue to talk about ethanol exports (from the US?!? something we really didn't envision..) it is at least a market that is growing like gang-busters right now... as well as restarting idled plants and putting people back to work.. win..win..win. | |
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Feb 2010 Supply ans Demand report
