Dean Miller always calls me when he is planting or harvesting on one farm that used to be mine. The call came this weekend, and I was able to catch him on his last round-and-a-half of beans. He had the ‘little” combine, so he was getting only 30 feet at a time. I am so old that I remember when Carl Stokes upgraded from 12 feet to 16 on our farm.
I have been saying all summer that we mostly were getting enough rain in Ashtabula County, so I was surprised to get out of my wife’s car and find the headland powder dry. I was shuffling up little clouds of dust as I walked.
The combines were running hard in my part of the country the last few days, and farmers were mostly happy with yields, although they were not seeing the records I had predicted. The beans were clean and tall, and the fields were hard enough that even here in the Swamp Belt, the semis could back into the fields.
That mostly ended Monday in the north with a hard shower, and more rain is predicted Wednesday through Friday. It remains to be seen if we can continue an early harvest.
Markets
As happy as early conditions have made farmers, the prices have not. Talk at the Farm Science Review, according to our reporter on the scene, was how to pay for $300,000 combines with $3 corn. That is, if the corn was worth that much, and the combines were that cheap!
As I study the charts this morning, I see some sign of help for both corn and soybeans. That doesn’t mean much, because at heart I am still a farmer, and still think like one. The key is being able to look at a chart and imagine that it has to turn higher. Just slug the grain into the bin and bet on higher prices!
Look at the November bean chart. What I see, or am hoping I see, is a strong line of support. We have had price cycles recently, and they all stop going down at the same price level. That’s the line of support — connect the dots of the lows.
This morning (Sept. 27), we are off the bottom at 9.47 3/4, up two and a half cents after an ugly (down 21 1/2 cents) Friday. Harvest is here, and this is the classic case of harvest pressure on futures prices.
Both directions
We had follow-through Monday (another dime down), but this morning’s slip higher feels good.
On Aug. 22, were had a $10.20 high, then made a low at $9.37 on Sept. 1. By the 12th, we were back to 9.90, then slipped to 9.40 3/4 on the 14th. On Sept. 20, we hit 9.94, then slid to 9.43 3/4 on the 26th, Monday.
So, we are having lower highs, which is not good, but the support just above 9.40 is harder every time we go down there and bounce off.
Corn futures are a little different, but still encouraging. There we are having three cycles of highs that are noticeably lower, but lows that are noticeably higher. (You have to think about that for a moment.)
Nearing the point
The technicians are drawing lines that look like what they call a pennant formation. That is, it forms a triangle with the point to the right side. The problem with a pennant is that we will eventually break out of the formation when it gets near the point.
It remains to be seen if prices break out to the upside or go down. The optimist (farmer) in me says that we break to the top and start firming up prices.
Remember, Pappy said there are three types of people in this world: optimists, realists, and pessimists. No pessimists farm, and very few realists do!
Unfortunately, the realist in me (sorry, Dad!) says that we are harvesting a record crop and we will struggle to move prices higher as we look at the piles of grain we need to chew through.
The optimist, however, remembers the old saw: The cure for low prices is low prices. When the users become convinced the low is in, they will buy, and buy big. Eventually that helps.
