Dead cat bounce continues
Being a retired farmer, I should be looking at the calendar and relaxing a bit now that the 2011 harvest is in the bin and fall field work pretty much all done. Being a no-till operator, my post harvest operations go very fast. This year most of it consisted of disking the river bottom field that was under water all summer. Fortunately I was able to avoid getting stuck in the sand left by the river overflow.
With the excellent weather, the custom operator got the mixed fertilizer applied and next year’s soybean field sprayed for winter annuals. What is really needed now are a couple of inches of rain before the ground freezes. Excavation for a new septic system at our rental house revealed dry soil all the way to the bottom of a four foot trench. Maybe we will get that moisture this weekend.
Markets are usually boring and less hectic this time of year. That is not the case today. The dead cat bounce in soybean prices has been especially frustrating. After one of the sharpest rallies in history off the harvest low in early October, futures prices trended lower with occasionally short, sharp rallies that were not large enough to erase previous losses. As of Thursday’s close the cash price was still above the October low by 25 cents. So the bounce continues. It could end with less than one day’s market action.
Corn seems to have the best fundamentals of the grains but likewise has not been able to mount a sustained rally. Negative psychology caused by uncertainty in the world economy and weakness in outside markets had led to wild price swings in all of the markets. The prospect for that situation to change any time in the near future is poor at best.
Long-term seasonal price charts show soybean prices weak until the middle of February. Corn futures are normally flat during the same period with higher prices the result of basis improvement and carry in futures. Most of my beans are sold with the balance in commercial storage. The corn is stored at home with orders above the market to sell on the way up.
For the next week I will be
preoccupied with planning for this season’s marketing workshops. Organization
of the programs is complicated by the retirement of Doug Jose from the
My experience and on farm research at my farm have shown the validity of using seasonal price patterns as a tool in making grain sales. The team from UN-L Extension and the Nebraska Soybean Board will have a computer simulation game to reinforce the knowledge developed in many years of research on implementing marketing plans. Watch for publicity on times and locations of these workshops after January 1.