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USA | DJM,
Pretty simple, farmers have sold too much, endusers are still short bought, world will replace feed wheat with corn. USDA is still too high on corn yields. And the most important of all, the big money crowd smells blood.
IMO several reasons it is going to be hard to get additional corn acres in 2011 at current price levels.
1) First will use myself as an example. In 09 was 70% corn, 30% wheat- double crop beans. Am 96% corn in 2010, 4% wheat double crop beans. For 2011, if things work out as planned will be 75% corn, 25% wheat - double crop beans.
2) Talked to a number of people in the last 6 weeks that have been heavy on corn acres that are saying they are going back closer to a 50- 50 corn bean rotation in 2011.
3) There are cash flow problems in the farming community. Talked to a couple machinery jockies at a sale yesterday. Both said the same thing, machinery values have softened. Which was evident at the sale, pretty much a bargain day.
4) Would look for lenders to tighten up lending standards on those who are having fiancial stress.
All of the above are not friendly to additional corn acres in 2011. Dec 2011 corn probably needs to put another $1 on it to get the needed corn acres.
Edited by coup 9/12/2010 08:28
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Coup
