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| The numbers presented at the Outlook Conf. are meaningless. USDA had the problem their report for the conf. was prepared weeks ago & out of date & had to say something.
First, futures markets are not logical in the short run. It is a little like driving directly from Chicago to Los Angeles without a map....eventually you get to LA, but might have a side trip or two (or more). Might be Montana or New Mexico before the final destination appears.
I view the following:
We began with a short world wheat crop. Ethanol. The Mandate.
We are picking up additional feed grain exports from the absence of China in the export market.
China has some serious problems. To me this is evidenced by their actions. Having dealt in the past with Japan & folks in the Middle East , in comparison the toughest & most shrewd purchasers are in Asia. They are buying carte blanc & they have money. This type of action is outside their normal profile, in my view. Evidences concern.
However, this outside influence is a disruption. They will stop at some point.
Ethanol is not going away...neither are the other bio products. On top of this, the market is suddenly flooded with purchasers normally not involved in agriculture.
China's corn exports to the Asian market typically peak in March.
These prices are buying acres.
We will soon be seeing some wheat from India in these markets.
While I remain in the bull camp on corn and beans, I do not like this wide anticipation in regard to this march 31 report. Might be best to plan a trip to the islands during the first week of April and avoid the television & market quotes --present expectations may lead to a great deal of disappointment and we have to endure again buying back demand for awhile.
Edited by SeniorCitizen 2/21/2008 12:44
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A thing or two.
