Sunday Night and Matt Bennetts Weekly Comments 020220

Suday night calls are lower to start.

China Stock market is expected to fall 5.4%. A better close than that will signal trader that the 21.7 bil liquidity package PBOC implimented is a strong show of liquidity. Main watch is for rate of contamination starts to slow or decline. One person has been treaded with HIV and antiVirus medications and regained health.

If fear is out of market ,next focus will be when does China buy US commodities.

We will all be in Council Bluffs for Tuesday meeting. Please come buy – starts at 7-8 and we are done at 1

Bill Biedermann


Matt Bennetts Weekly:

I hope this winter has been a good one for you so far.  As we enter into February, it’s hard to believe but we’re only a couple of months at most from equipment running in many areas.  We are still saturated around my farm, which has made for a mess with regards to our cattle.  As I’ve mentioned before, we don’t have a ton of concrete, and in the past we hadn’t needed it much.  It’s tough feeding hay when chewing through mud the whole time.  I’m starting to wonder if we’re going to see another wet spring.  Many of you have lamented the same thing as I’ve been out on the road.  Speaking of that, I just finished a little ‘tour’ of ten days gone from my kids.  Tif joined me for about half of that time as we were lucky to be asked to the Dominican for four days with a Channel trip.  However, being away from the kids for that long is something I haven’t done before.  The kids must have asked me when I would be home at least 25 times while I was gone…and Tif said that was just a small portion of what she heard it. 😊 This late January timeframe is when many of the conferences are happening, and this year they all happened to pile up on one another.  While I love getting out there and seeing many of you who I’ve met before or read this newsletter, I have to say being gone that long gives me an appreciation for home.  If you’re like me, a trip now and then is pretty neat but there’s nothing like sleeping in my own bed with my family under the same roof.  Now, I know I’ve had a chance to meet many of you in January…but I have another 6 weeks or so of meetings…no ten-day trips thankfully.  So, let me know if I’m in your area as I’d like to meet you.  The meeting me and my buddies with AgMarket are putting on is in Council Bluffs on Tuesday, so if you want to attend, let us know.   Otherwise, stay in touch.

The corn market couldn’t seem to get anything going this past week losing some ground on the week overall.  The bean market continued its plunge, moving to multi-month lows in an abysmal showing.  I’ll tell you what…these markets are sick.  It’s not much fun heading into the month of February when we set insurance prices and see these poor markets.  As we move through this month, my gut tells me we’ll see some strength as we sure aren’t buying any big interest to plant either crop at these prices.  Yes the American farmer will plant, but at the same time, if spring prices aren’t all that sexy, one could expect prevent plant to be sizable as compared to many years…but certainly not last year.  Given the weather so far this winter, it appears the opportunity for prevent-plant could again be there, especially in the upper-midwest and Dakotas.  As far as the outside markets are concerned, some support came in at the end of the week with a sharp sell-off in the Dollar…but with crude not able to gain any traction, the impact was muted a bit.  March crude closed down 51 cents at $51.63.  This was $1.73 off the highs and 66 cents off the lows of the day.  Crude lost $2.57 on the week…and over $7 in the last two weeks!

CORN – The corn market had a tough week overall but ended on a good note.  On Friday, March corn closed a penny and three-quarters higher at $3.81 ¼.  This was a penny off the high and 2 ½ cents off the low.  On the week, the corn market lost six cents and eight cents in two weeks.  While that may not sound like much, it sure seems like plenty, especially heading into February.  Not only do we have crop insurance to think about, but so many bushels are on basis contracts this year.  Producers will have decisions to make on whether they want to go ahead and sell or roll from March to May.  We’ll keep close tabs on that and talk our way through it over the next couple of weeks.  I’m not bearish old corn…especially when it comes to flat-cash price.  Producers have been tight-fisted in some situations but plenty of corn has also been sold…as even with MFP money in hand, it’s been tight for most of us.  I have to think basis will continue to try and buy the bushels if the board continues to disappoint.  If you watched US Farm Report this weekend, one of the analysts said it seems the board is trading global supply and demand while basis levels in the US are more reflective of our situation.  I think that’s a great way of explaining it.  I’m not bearish at these prices…but urge clients to have a plan for any type of price action as I am a bit fearful our markets won’t offer the opportunities we saw last year…without worse weather, which would be hard to imagine.

DEMAND – Demand was again solid overall as exports were higher than the big number from last week while corn usage for ethanol continues to slip.  Weekly export sales were 1.235 million metric metric tons for this marketing year, up by around 250k from a week ago.  For next marketing year, 144k in sales were posted.  Overall sales were about 400k in excess of last week’s totals.  These are the type of numbers we need to continue to see…if China joins the mix, it could certainly reverse the USDA’s trend of dropping exports to where they have to raise them some.  Corn usage for ethanol was down again as the plunge in crude prices has seemed to cut into margins enough to slow production.  Usage came in at just under 103.5 million bushels, according to the Department of Energy’s EIA report.  This was a decrease of around 2.5 million bushels.  Basis continues to be solid in most every area I check on.  My area saw basis option the March, which is two cents better than a week ago.  In Decatur, basis improved by six cents, moving to 20 over the March.  On the river in St. Louis, basis was status quo, staying at 19 over the March.

CASH CORN – Cash corn was lower on the week as futures were off while most areas saw basis steady to better…but not quite enough to make up for the loss on the board.  If you were paying attention though, at ADM Decatur, our big terminal in this part of the world, basis made up for the whole loss on the board.  I know from what many of my clients have told me that originators are bidding over their posted to try and get corn bought.  I’d continue to be a price maker as long as you can…and as long as your corn will stay in good condition.  I hate hearing about more producers getting trapped and perishing in grain-bin accidents…let’s do everything we can to avoid any more of those.  The condition this year’s crop went in the bin makes those types of accidents more likely though…so plenty of precaution is warranted.  Moving ahead, the best thing to do on bushels in your bin is to make sure your end-users know you have it…and what you want for it.  Keep an open dialogue and make sure you have a plan.

2020 CORN – December 2020 corn had a rough week, losing even more ground than front-month prices.    Dec20 closed on Friday up a quarter-penny at $3.90 ¾.  This close put Dec20 prices 7 ½ cents lower than the close from a week ago and 12 cents lower than two weeks ago. This Dec corn has certainly been under pressure, but I’d have to say it makes sense.  Given all the talk about huge acreage, I’ve been neutral at best on Dec corn for some time.  I’ve only sold 30% so far, but if we get back towards the levels we sold at before, I’ll likely be selling another increment.  Again, I continue to urge clients and those who call for advice to have their costs figured and plugged into a profitability spreadsheet with projections on yield with acreages for 2020.  The webinar Channel and I put together that I’ve mentioned several times continues to be a great tool for producer to access if they need help understanding how to get a plan in place. As I’ve been out speaking, I’ve found many didn’t know about it…so look it up if you’d like a little direction on marketing.  As always, don’t forget to use the profitability calculator in the app to see how your profitability is shaping up.  If you need help with a marketing plan for 2020, let us know.

What To Watch For –

On 2019 corn, my farm is 80% sold @ $4.30 basis March20.

For 2020 CZ, up to 30% sold at $4.05.  Next target for me and my farm is $4.09.

BEANS – The bean market hasn’t gotten off the struggle bus…I left that analogy in as I had a few of you send notes of appreciation for that reference.  Simply put, no one is buying beans right now.  On the close Friday, March beans settled 3 ¾ cents lower at $8.72 ¾.  This was 10 ¼ cents off the high and a quarter-penny off the low.  On the week, beans were down 29 ¼ cents and 74 cents over the last three weeks!!  This bean market hasn’t seen prices like this in over a half a year.  I wasn’t surprised by most of this move…until this past week.  I thought $9 might be support for these beans, but that obviously didn’t happen.  It appears Brazil is set to have a large crop…and when I was on USFR with Dan Basse, we talked after the show about this bean situation.  He feels like there’s a good chance the Brazilian bean crop could top 130 million metric tons…a record crop.  If that happens, given the currency situation, it will be tough for the US to see bean exports competitive on the world market.  Right now, I’m neutral to friendly beans…but there’s no guarantee these beans won’t continue this trend lower.

DEMAND – Soybean export sales were lower than totals from a week ago.  With net sales of 470k tons for old crop, sales were 320k tons lower than a week ago sales.  For new crop, just 2k in sales were recorded so overall levels were over 320k tons below a week ago totals.  As far as basis is concerned, there hasn’t been enough improvement, which is certainly not a good sign in a downward-trending market.   Local bids for me are 15 cents under the March, which is two cents improved on the week.  Decatur’s basis for cash beans also were status-quo, staying at 8 over the March.  On the river, basis was quoted at 21 over the March, a penny off from last week.  Bean basis needs to do more work, but I don’t see that happening unless we see our export market heat up.

CASH BEANS – Cash bean bids were again sharply lower this past week.  With the basis not doing much of anything, cash bids were plummeting.  Given how strong of a rally we saw from December 1st into the new year, producers had a great chance to catch up on sales.  Now, many are wondering if they’ll get another chance like that.  The big issue with this thinking is we already saw a big rally with basis steady to improved…that’s not normal.  I’d assume if we saw another big rally, we’d likely see basis widen.  Maybe the best hope on cash beans is to be patient as there is always a chance that some regions could run tight on cash beans later in the summer.  IF this Phase I trade deal is worth what it’s been reported to be, China is going to buy a decent chunk of US beans…if that’s the case, beans will likely catch a bid once we see some sales. I’m not sure I’d be selling right now, but as always, if you can make money on your farm, there’s nothing wrong with making sales.

2020 BEANS – November 2020 beans again lost ground this past week, just like everything else.  To close the week, Nov ‘20 beans settled at $9.12 ¼, down 3 ¾ cents.  Nov20 beans lost 26 ¼ cents on the week…and has lost 62 cents in the last three weeks.  I am still sitting at 25% sold for 2020 beans but always considering adding to sales.  Our target was $9.83 to get another 10% sold…but our team also is likely to sell some beans cheaper than that.  Given how profitable some of our clients can be anywhere close to $9.50, it’s tough to not sell a few.  Either way, we need to have a plan in place.  Call if you want help with your 2020 marketing plan.  We’ll be glad to help you get it put together.

As always, be sure to figure break-evens when deciding whether you want to make sales.  For figuring your break-evens, I recommend using the AgMarket.Net Profitability App to help you get a handle on your budgets and to set your marketing plan for 2019 or 2020.  We’d be glad to help, so be sure to reach out.

What To Watch For –

I am 70% sold/hedged (basis APH) at a board-based average price of $9.64SH for 2019.  I’ll consider selling more old beans with a rally to $9.55 Mar.  For 2020, I’m up to 25% sold at $9.63 average basis SX20.  I’d be willing to sell more on a rally to $9.83.

**For the strategies I talk about on here, please remember these are the tools I use for my farm.  These are not recommendations but merely a way for the reader to see how I approach marketing for my operation.  There are tons of good tools out there. For more information on markets, strategies and ways to set up a solid marketing plan, visit my website at

I hope you have a great week.  Please let me know if I can help you in any way.


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