CORN PRICES AND FEED PRICES

I saw a post a few days ago where the comment was made, I hope they have a bumper corn crop and prices for a bushel of corn go way down, and then the price of feed will be lower and I will be able to buy feed for my stock.
First I find it hard to believe that any farmer would wish other farmers low prices for their crops. I know of no farmers who are paid too much for their crops and the hardwork and the hugh investments of money, time and labor that we put into them.
Further, anyone who knows anything about how markets work can predict that even a hugh drop in corn prices paid to the farmers will, at most, amount to only a slight drop in the prices charged to farmers who buy grain. Most of the big feed producers and even the smaller ones see lower crop prices as a chance to make some real money.
Yes, they will lower the prices some but only to fool the farmer into thinking they are getting a price break.
Just think about the price of gas and diesel fuel. The price goes up for a while and then it drops a little and then it goes back up, only now a little higher and then before and, yes, down a and little once again and higher still, over and over again.
 
The price of corn right now may still be based on the USDA prediction of a huge amount of corn being harvested. I see lots of comments on here about corn in different parts of the country not even producing a crop. The actual price may go up when yields fail to achieve USDA predictions.

My brother is skeptical that the corn and beans will make a crop in his area. Our nephew 60 miles away got 6/10ths over the weekend; he thinks that will be enough to get the corn to at least make some kind of yield.
 
I should have ended my post with the statement that as farmers we must support other farmers.
If we don't support each other how can we ask the rest of the people of this great country to respect and support our efforts for a fair price for our products.
 
I haven't seen any grain farmers that have felt too bad for the livestock farmers the last few years when grain prices were sky high and I hope they aren't expecting to much sympathy from us now.Guess where you find sympathy in the dictionary?
Anyway Uncle Sam always rolls out the checkbook for grain farmers when the price goes in the tank.
 
I did not see too many grain farmers "supporting" the livestock farmers the last few years. I know livestock farmers that where set back ten years in what they lost the last few years.

One dairy not far from me was losing $100K per month with the raising feed cost. The biggest part of that was THE CORN PRICE!!! What was the family supposed to do??? Sell all their cows???

When the livestock farmers are making a good profit I did not see them running up ground to $14,000 per acre or out buying new combines/tractors every year and such or paying $500 per acre cash rents. Two different BTO just west and north of me paid that this year.

I sure did see a whole bunch of grain farmers spending money like drunken sailors. Plus then still receiving Government CHECKS!!!!! Why should they be getting money when grain prices are at record HIGHS???? I know they "earned" it 4-5 years ago. Well they where making money then so why should they get a "handout" now???

What is going to happen is that a whole bunch of GRAIN FARMERS are going to go bust when the grain prices cycle. Then they are going to go around screaming for the Government to bail them out of the mess they made themselves!!! I saw it happen in the early 1980s and the same attitude has been driving them now. GREED!!!

So I say let the grain farmers smack bottom just like the livestock farmers always have to do. I have never seen much in the way of government "hand outs" to the livestock farmer.
 
I agree 100%. My neighbor works at a Case IH dealer. He says the last few years have been nuts. Selling equipment as fast as they can get it. That works for the guys that bought equipment at the beginning of the high grain prices. They will have it paid for by the time it all swings back down. But, the guys that just bought, and have years of payments should be getting a little nervous with the projected corn prices for this fall...
 
The cow calf operator needs revenue shareing insurance from the goverment like the grain farmers. My landlords are looking over the fence and seeing the neighbors new equipment and threating to raise the rent or take the hay ground away from me and plow it. I keep telling them the grain bubble will bust some day.
 
I don't see where guys with livestock are ~any~ different. They just operate within a different bubble. When the price of beef goes up every Tom Dick and Harry think's he a cowman and starts keeping a big bunch of cows until the price crashes again. When the price of milk soars there's nobody like a dairyman to cure that problem by expanding by another hundred head. In certain locales here those are the guys that do run land rent up. The big guys that have the cash flow run the quota prices up, etc.
The only thing keeping beef from making a comeback in this area right now is largely the fact that the herd has been decimated overall to the point that there aren't the numbers to rebuild it quickly... or the liquidity... or for that matter, the general infrastructure as most of that has already crumbled after 10 years of poor prices from the BSE mess. It's certainly not from the number of saints that pervade in the livestock industry that's preventing a large scale rebound.

Rod
 
You must be talking about my comment the other day. And to answer your question, yes I do hope the market falls out. The last few years livestock producers have felt the pain of high corn prices. I don't recall anyone saying, cant we all get along then. The silver lining the last few years has been waiting to see the market drop and watching everyone start to whine. Guess what, it's here and you have your self to blame. People got greedy and planted more and more corn this year and best news is most of its looking good and the price is falling. My grain bill is directly tied to the Chicago board of trade and prices fluctuate daily so no, it's not a smoking mirrors cost savings, it's a real life savings. But look at the good news, when corn gets cheap again ethanol will start up heavy again and then the government will give my tax money away to company's to produce more and your price of corn will go back up.
 
you can make that statement about supporting one another, as long as you're not one of them knotheads that likes to use variations of the word "compete" when speaking about farming.
 
i should add that i kinda hope for a crash also. i will survive it but hopefully it will weed out some of these commercial farmers (bto's) and bankrupt some speculators. wishful thinking perhaps.
 
Sure glad I have better neighbors than this bunch..... ;)

We actually still care a little about each other.

Paul
 
if i were king, there would be no livestock raising without growing your own feed, with limits on the size of the operation.
 
If I were king there would be a limit on the size of a grain operation.

I raise my own pork. Most often I put in a few extra to sell but this year I only have enough for the family. With dropping grain prices I'm happy. You think any of these "good friend" grain farmers would sell me grain at less than market price? And you want me to have sympathy for them?

Rick
 
yes, i meant the entire operation. sorry if i didn't make that clear.
it's all ranting anyway. without sufficient conviction and a lack of time, i have no clear idea how one would go about implementating my statement and what the consequences would be.
 
Did you sell any of your grain below market to your livestock raising neighbors?????

I have had many of my GRAIN only neighbors try to rent my hay/pasture ground right out from under me in years past.

Never had any of them offer to take under market for their grain either.

So it is not about caring about YOUR neighbor. It is about a grain cycle that has created some outrageous profits for the grain farmers and just about bankrupted many livestock farmers.
 
All the time from the 1970's until the early 1990's the grain price didn't budge.

I saw a show on TV where a guy had cut a hole in the side of a cow, and had a ring in there, so you could see what was in the stomach.

That is going too far.


High prices cure high prices, low prices cure low prices.

That is fact.


Do I feel sorry? I feel about as sorry as the beef guy buying my $1.85 corn less than 10 years ago. Would I raise beef? no! way too many things to do raising them, and every time I turn around, there is another group trying to outlaw a practice.



No one should be after anyone. Without buyers, grain is worthless. Without grain, cows look like skeletons. I rag on a local guy for even bothering with his 18 head. He went through way too much to feed them, and what did he get in the end? Just a few thousand dollars.


The key is, "go big or go home."


If you can't do that, expect to get trampled on. Last I checked, it is still dog eat dog. If I see a cattle guy with a new truck, when mine is 15 years old, I don't feel sorry. Grain is hard too.


Cattle is more work though. Why anyone does that is beyond me. there is no money in farming unless you are a BTO. That is true for livestock and grain.

What I have a problem with is that the price of beef has gone up quite a bit for the consumer in the past 30 years. only in the past 7 years has the grain market gone up.

Let's just hope that we all can get back to a point where we can afford to buy what we grow. That's the general state of the economy. Right?



Guess I am a strong back with a weak mind, because I just believe that everyone should get to make money to stay in business, bt at the same time we all know no one gets rich from honest farming.
 
First, everybody in the industry is guilty of greed. Grain farmers may be pushing land prices in the Mid-West but big dairies and to a lesser extent the Mennonites and Amish here in the Northeast.
Second, each industry has a rational as to why they should have government intervention and the other guys should have to ride out the free market.
Third, land prices will have to adjust down to where price reflects productivity. The government's debt situation will be of particular influence here. Who is going to pay approaching 20 trillion dollars of national debt. It's not going to be the people in the trailer parks or the fat cats who have moved all assets off shore. It's going to be you and your neighbors who are somewhat of means. You'll be paying pretty hefty sums, too. Enough to where bidding wars for ground will be paltry to what they are now.
 
I don't want to see anyone hurt, but there don't seem to be too many people worrying about my situation. With the ethanol deal a few years back corn prices skyrocketed and it hasn't slowed since. That's great if you're a corn farmer, not so great if you're a sheepman trying to get a start. If all the grain farmers went out and bought new stuff, good for them. If they can't pay for it if the price falls by 25%...well, that's just poor planning ont heir part isn't it? I didn't hear any grain farmers boo-hooing about $13.00 milk or 70 cent lamb. Kinda hard to get much beyond hoping they don't get hurt as far as I can see.
 
Uh-oh, a farmer's making a buck. Everybody drag him down!

I do not understand this mentality. It's one of the main reasons I did not stay on the farm when I graduated from college. You can't make money and when you do all your fellow farmers do their best to make sure it doesn't happen again.

"Feedlot farming" is a lot like a variable rate mortgage. When grain prices are low, you can afford to buy all your feed instead of growing it. When grain prices are high, you lose your shirt!

The only way to do it right now is to grow your own feed. If you can't grow enough of your own feed to support your herd, you have too many animals and you need to get rid of some.

Don't cry that the grain farmers should be giving you CHARITY because they're making money and you're not. You chose the flawed business model that only works when commodity prices are low.

In reality you may end up making MORE money with fewer animals, because you've lowered the supply. There will be a short-term glut on the market, but 6 months down the road there will be a meat shortage and prices will skyrocket!

Farmers don't typically understand basic economics. Their answer to dropping prices is to increase production, same as if the prices are rising... I just don't get it.
 
JD Seller & Massey farmer,maybe I was raised in a different culture,but we and others only raised what livestock we could feed(raise).The BTOs(your words)in livestock were also the largest farmers.If you needed more feed you bought or rented more land.When grain went down to cost,they said how stupid it was to raise grain and started buying feed and raising more livestock and then went the other way when grain went up.I was always taught $1.00 corn makes .10 hogs.And JD,a lot of big cattle people got a lot-a lot of government money(feed cost) during drought yrs.
 
Yes I did.

Two whole wagons of ear corn to my neighbor with 5 head, corn was $7.22 when I delivered the ear corn to him last fall, I plan to put this weeks price on it when I get around to giving him the bill. Perhaps we will meet in the middle, but that still is a discount. Think cash corn is 5.70 or so, I believe $1.52 off is a discount?

Also 1100 bu of ear corn to a dairy down the road, he got hail bad last summer and needed ear corn. I threw in my labor free, and discounted the corn 11 cents a bu - it is common to add 10 cents like the coop does, so my discount might be closer to 21 cents a bu, but either way, a discount.

My close dairy neighbor we need to settle up some time, I never got around to presenting him a bill, but we have some oats, silage corn, and straw bales he owes me for, the price will be rounded down and some of that is 3 years old, no interest because I didnt present a bill yet. I consider that a discount? Also sold 2000 bu shell corn from my crib to him, was premium corn better test weight and quality than #2, we settled up on that at cash price, no 10 cent premium, no bonus for 61 lb test weights tho clearly he got Better milk from it than from coop corn. I've kinda hated to send the bill, dairy is so tough these past 5 years....

A hailed out sheep guy asked me for oats last year also, he offered the 10 cent premium before I could say much, so he got the load of oats for the price he offered.

I've often said on this forum and perhaps more on NAT, these high grain prices are once in a generation deal, and not good for livestock folk. We would do better with somewhat lower grain prices instead of the roller coaster highs of the past couple years. I've thought that for some time. Said so as well.


Now, I also remember the 1980s and 1990s, corn was under $2 a bushel cash long term, and recall livestock guys openly laughing, that they can buy corn cheaper than they could raise it, why bother planting crops when you can buy it from people losing money on crops?

What goes around comes around.....

But that is negative thinking, and not the direction I want to go.

I raise a little beef and more grain, we need the ag economy to work, not be a roller coaster. A little steadier, tad lower grain prices will be a good thing for all, in my opinion. Not that I was unhappy about getting $7 a bu for a little of my corn, but I want a good long term ag economy, not the crazy spikes and valleys.

We need incentive for grain farmers to produce grain, and we need buyers for it, between exports and local livestock and ethanol/ddg users.

Stable moderate prices help us all in the long run.

Paul
 
You get it, mkirsch.

Fortunately not every neighborhood is like the sour grapes in
this thread.

Farming is a business, you got to keep on top of things and
make a buck when you can.

But you can also care about your neighbors, and many still do.

Dad got rid of hogs on this place before I got into grade
school.

But I help my county pork producers with their fund raisers, tho
I'm not a member and don't raise pork. They buy my corn, I
can help them out with a little spare time.

Focus on the positives.

Paul
 
It would be great if all the farmers supported each other, but that never has happened and never will. Read the old Country Gentlemen and Farm Journals from the 40's and 50's, nothing had changed, they complained back then too only they were screaming for gov't price supports. It's the same old story.
 

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