Note: this is the second post of today. Scroll down for the first regular article.
BUY GRAIN NOW
I know that you have been beating the “BUY WHEAT NOW” drum for a while however we are in the perfect storm for low prices this year. There is a short term glut of oil internationally that will be over by 2017/2018. The oil from fracking will slow to a trickle soon and the big money will be slow to get back into that market after this oil fall. Oil prices have everything to do with low grain from the fuel to produce it to getting it to the consumer (Rail and Trucking). It also impacts the prices in making fertilize and other chemicals used in farming.
The following report is for corn but as corn goes so goes wheat. Whether you think a total collapse is in the future or just that grains might go up 3 or 4 times the price of today, this is the year to stockpile and it might be the last time we see prices this low.
Keep in mind that the outlook does not take into consideration major weather problems or Black Swan events. NOW is the time to buy. Also remember as you read this that I’m NOT selling anything, I’m just giving information and opinions as I see them.
Grain price outlook
USDA Forecast for “Next Crop” MY 2016/17: In their early release Agricultural Projections to 2025 the USDA provided an initial forecast of U.S. corn supply-demand and prices for the “next crop” 2016/17 marketing year beginning September 1, 2016. The USDA projected 2016 U.S. corn plantings of 90.500 million acres (ma) – up 2.501 ma from 2015. Forecast 2016 harvested acres of 82.700 ma would be up 1.951 ma vs 2015. With projected yields of 168.1 bu/ac, 2016 U.S. corn production is projected to be 13.900 billion bushels (bb) – 2nd highest on record behind 14.216 bb in 2014. With forecast MY 2016/17 total use of 13.935 bb (record high), and an adjusted projection of ending stocks of 1.832 bb (13.15% S/U), U.S. corn prices are projected by the USDA to be $3.60 /bu – unchanged from the $3.60 /bu midpoint estimate for “new crop” MY 2015/16.