December corn gained 4 1/4 today, closing $3.58, which is down 1 1/4 for the week.
November soybeans gained 2 today, to finish at $9.68, up 17 1/2 week-on-week.
January beans added 1 1/4 today and finished at $9.73 1/2, gaining 17 1/4 for the week.
The big story this week is the further deterioration of the U.S. corn and soybean crop. At the end of today’s Bull Bear Banter, we have a bonus segment with Dr. Charles Hurburgh. Charlie manages the Iowa State Grain Quality Research Lab as well as the Iowa Grain Quality Initiative. He has some very valuable information about this year’s corn crop and touches on the fact that the crop you are observing this week will be different next week. I think he brings some valuable information to anyone planning to store corn this fall. He also touches on Crop Insurance and his thoughts on how to achieve a fair representative sample from damaged cornfields.
Beyond that, during today’s discussion, we updated crop ratings. These confirm Charlie’s thoughts. We hope you will listen to the podcast for all of this information.
Finally, as many of you know, last week, Landus started what we hope will become an annual event. We surveyed 278 townships across 35 counties and published our findings during a webinar on Wednesday. We hope this will provide us a very good baseline for not only results but the process we used to determine those results. This info can also be found on our website. The main take away was the high variability of the crop from field to field in the same township. We noted wide variances in every county and across our entire territory. One note: We avoided the most severely damaged areas due to the Derecho storm of 3 weeks ago. We also echo Charlie’s thoughts, as we said that we expect the actual yields in these areas to be less than what we found, simply because of the ongoing dryness/drought in Iowa.
The podcast can be found here: https://landusexperience.podbean.com/
This week, I noted several news stories about the departure of the CEO of a company touted as a “market disruptor”. This company will continue to try to buy farmer grain. I have long wondered how they will do that, as they own no grain elevators, use no semi-trucks nor lease or use any rail cars. They literally have NO ABILITY to handle grain. They do not employ people in your community for you to talk to. They have made no investments in your community and pay no property taxes. The main message they use is that they will find “new markets” for farmer grain. I continue to believe that the grain business is one of the most transparent businesses there is. You can literally find a bid from hundreds of grain buyers in this state. You can call their “local” phone number. You can drive to their facility. You can interact with their employees in your community, see them at church, or on main street supporting local businesses.
As I said, I have wondered how their business model will work in this industry. I remember many of these types of businesses that popped up in the late ’90s and early 2000s, that were mostly web-based and promising to “make things more transparent”. I watched as all of them went out of business within a few years.
Perhaps this company has a different recipe. Perhaps they know something I don’t. My research says they have been very good at raising money, venture capital. But I have yet to see that they have turned a profit in over 5 years of business. Maybe that is what led to the change in leadership.
If you are truly unhappy with the way we, or others located in the state of Iowa, are doing business in the grain industry, I invite you to discuss it with us. Contact me or one of my coworkers. We love being in this state, this industry, your communities. We want to earn your business each and every time we have the opportunity. Tom.Guinan@LandusCooperative.com