What will the new year bring for prices

[cottonpicken]

vvalk, that is what I'm doing with my old crop. Pretty confident $450 will happen before end of Jan.

[classicalliberal]

Dalek, I think more producers should be as proactive at forward contracting at reasonalbe profit levels based on average yields. That is what I try to do. There was a problem last year when no end user would price canola or soybeans more than 30 days so I just sold some futures to lock in those levels. This game is about growing the best crop possible and locking in profitable levels when they are available.

[classicalliberal]

Be ready to sell when it hits your numbers and not try to get last years prices because I just can't see them get to where they were.

[dave4441]

I agree, but pretty amazing charts on corn/Soy and wheat in the US markets over the last 10 days. Corn up 33% from it's low. I am not a technical trader, but is that all this rally is based on, or is their fundamental reasons for all these markets to be moving ahead like this? Year end buying to flatten positions or what?

[dalek]

Classicalliberal I should point out that I believe the elevators here were only contracting 2010 soybeans for about 3 days last summer before they backed out of them again, I got in on the second day. I don't know that they ever contracted 2010 corn once it got over about $5 and there were lots of days near the peak of the market where they weren't contracting 2009 corn or beans either.

Still, I'm reasonably happy, particularly now that I have a maximum price contract on my diesel out through June.

[classicalliberal]

Yes Dalek, I know what you mean, when the commodity prices skyrocketed last summer, many elevators and crushers were having problems with margin calls and were not willing or able to buy more. This is why it is good to have a futures account. My banker told me that he would finance my margin calls for me cheaply because he knows that I am locking in profitable levels. If the elevator doesn't buy, just sell some futures. Besides, because of the risk premium on the basis out in advance, you would likely come out with a better price by buying back your futures at time of delivery at the current stronger basis then what they would be willing to forward contract for. I can understand why they do that because they are taking on the margin calls and have the basis risk because no one will bid out that far.

[dave4441]

Does anybody have any reccomendation for a broker in Saskatoon? A firm that will let a guy start on a small basis.

[classicalliberal]

I'm not sure of brokers in Saskatoon but there are a couple in Winnipeg. Union Securities and MF Global.