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Marketing Meeting Today!
A reminder of the marketing meeting today at 1:30pm, at the Training Center (McGregor Main Office on Airport Rd, Colfax). This promises to be a great meeting with Luke Swenson from The Money Farm, Kevin Duling of KDI and Cat Salois the director from R & T division will each be presenting this afternoon. All are invited and welcome to attend. Given what the markets have done the past 2 weeks, coupled with the weather thus far this spring, I think it will be well worth your time to attend if you can break free.
Speaking of the weather and back home, the upper Midwest is in the hurts right now. The region had one of it’s hardest winters in moisture received, yet that spigot has turned off to now the 3rd driest spring on record! Frankly, eerie resemblance to the last 3 years that I was on the farm in the late 80’s – in 1989 we didn’t fire up the combine, anything hay worthy was so harvested to provide feed for our livestock. Cattle liquidations have already begun with some sales barns adding a second sales day to handle and process all the livestock. Here's an article describing the herd reductions...
Budget proposed by the President - Nothing new than what's been shared previously, all are making their positions known...that said, there's many supporters for the infrastructure overhaul that this great country needs. Budget battle article 2nd view...
And a link to an article penned by our friends at K-State pertaining to how the proposed cuts to crop insurance will look.
Boris & Natasha - I don't know if these type of incidents happen frequently and the media only learn of such seldom, or perhaps it is boring as all get out and everyone scrambles just to break the monotony and add hype to an otherwise boring day...
Cattle - I've shared this here previously, the cattle markets are quite volatile right now. If the opportunity presents itself, look to lock in the current, profitable prices that exist.
Economy - We've shared a similar story a few weeks back regarding the subprime market, this one regarding auto loans.
Markets - Kevin and Luke will discuss this extensively today; suffice it to say, corn and wheat markets have made positive moves in the past couple of weeks. For example, recent spring wheat ratings released by USDA are at all time lows, only the earlier referenced late 80's were worse.
Along these lines the USDA released the second 2017 U.S. spring wheat crop ratings this week and using our usual ratings system (where we weight the crop based on the percent in each category and assign that category a factor of 2 for very poor, 4 for poor, 6 for fair, 8 for good, and 10 for excellent and then sum the results). This year's second spring wheat rating is 696 which is the second worst rated crop as of June 4th going back to 1986 with only the 1988 crop worse with a rating of 574.
There are estimates of what the MYA price will be when announced later this month by USDA. This is the price used when calculating ARC & PLC payments. The projected average wheat price for the 16/17 is $3.91, which is virtually unchanged from previous. ARC reference price for 2016 is $6.70, the PLC reference price is $5.50. As a reminder, ARC payments are capped at 10%, whereas PLC does not have a payment cap in the calculation formula.
A couple of stories related to oil... Reuters-global oil and Oil Projections
Movies - It's summertime and Hollywood likes to get into our pocketbook with new releases. The new pirates movie was recently released, I'm being reminded of the new installment of the Cars lineup for my grandsons to be taken to. An interesting read on the risks associated with making said movies... 7 Riskiest Movies Made
Weather - After suggesting that another El Nino was possibly due to form because of the elevated temperatures off South America's coast, neutral conditions have returned and are expected through this summer and into the fall. What's the impact of a neutral Pacific?
I'll close with a current drought map of the US. As you can see, the trouble spot in the SE part of the country has shrunk being replaced by the area of the upper plain states.
'till next time, Happy Father's Day to all the dads out there!
“Never let yesterday take up too much of today.” ~Tex Schramm
McGregor Risk Management Services, LLC
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Posted in Risk Management; Posted June 12, 2017 by Curtis Evanenko
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