And yet beans are almost $9.  Go figure.  

Eith basis levels almost double what is normal leaving cash paid to the farmer barley in the 7.00 dollar range. That's 3 dollars  a bushel  less than last year .  Take that time's 48 bushels per acre  is $145 an acre  at 1000 acres equals  145,000 dollars don't know about you Jim but to me that kind of money matters.

frey:

Eith basis levels almost double what is normal leaving cash paid to the farmer barley in the 7.00 dollar range.

So, frey, what might be the logical cause of this?  

A lack of world demand?  Hardly, as futures prices reflect what buyers are willing to pay.

Cash prices, however, reflect what local elevators are willing to pay the farmers - right?  Why are they only willing to pay so little?  Because farmers have produced so many soybeans this year.

When yields are this high, cash prices and basis levels always suffer.  The farmer does not have any leverage whatsoever.  But, the 9.00 futures prices measure supply/demand at the world level.

The pipeline is full - it's mainly a supply problem.  9.00 futures shows this.  If it was a demand problem, you wouldn't see buyers paying 9.00 for future delivery.

No doubt it is real money and yes, China is stiffing bean farmers.  BUT!  Bean ES have broken every record there is.  SA has been adding 5-10% acreage every year for years now.  That had to catch up to bean farmers at some point.  The market is flooded.  It almost looks like SA can support China all by themselves with China changing their feed mix a little bit.  

Not sure, but I suspect this is not unlike the current cattle market.  Supply is up.  Demand is up.  But, with increased supply, packers finally have leverage, and they are making unprecedented profits.

The squeeze is due to supply - much more than demand factors.

The average rate of acres over the last 20 years has  been under  5 %  yes added production is a problem by farmers the fact that the US farmer is holding all the ending stocks is a Trump administration problem.

And while 5% doesn't sound like much, it is quite significant over a 20 year period.  

and here we have frey just gushing with glee....."Its a trump problem he says" must be a sad way to live, to actually root against your own country, its people, its veterans, its policies.....guess what you are also against....soon it will be another trump win for America

the fact that the US farmer is holding all the ending stocks is a Trump administration problem.

Ah, yes, so glad you point that out.

Demand is good - 9.00 shows that.

Supply is a problem.  Too many beans.  The pipeline is full.  Of course it's Donald Trump's problem. 

The US pipeline is full, The China pipeline is sucking air and that is the problem. Your failure to understand this is typical of traders vs marketers

The US pipeline is full, The China pipeline is sucking air and that is the problem.

Ah, China is not in the market.  I see.  That's why price at delivery points on the river is so cheap for future delivery.

No - wait - 9.00 doesn't sound so cheap.

Rather than blame Donald Trump for the big differences between prices at delivery points on the river and prices paid to farmers, wouldn't it be logical to assume the problem is mostly a huge crop that farmers and elevators are having trouble coping with?

I know  -  I know  -  it's just gives SO MUCH enjoyment to blame Trump .  .  .

It would be reflected in the cost of Freight.  You see when the farmer has a huge supply and we have a normal demand Market in beans  the Elevators are jumping at the chance to get their hands on freight in this scenario  cars to the PNW would sell for 1500 -2000 dollars  over tariff  today they are being offered at around 1250 under.  That tells anybody who understands freight that it's not a supply issue it is a demand issue.

It would be reflected in the cost of Freight.  .  .  .  cars to the PNW would sell for 1500 -2000 dollars  over tariff  today they are being offered at around 1250 under.  That tells anybody who understands freight that it's not a supply issue it is a demand issue.

Well, if you had done a study on freight that did not simply concentrate on the relatively small portion of soybeans that are shipped out of the PNW, I would be more interested.

Of course, the fight with China is having an effect, but the question is - what is the more significant factor?  Just looking at freight from the PNW seems to be very misleading, as that would be the rate most affected by tariffs.  Of course, if more beans are shipped to China from South America, freight rates would show unusual patterns this season.  The Gulf should be much more busy than the PNW.

Back to what seems to be obvious - $9 futures compared to $7 cash a the farm level.  If we assume that your numbers are anywhere near accurate, and freight rates are as cheap as you imply they are, and the crop is big, why the $9 price for futures?

When you hear hoofbeats, think horses - not zebras.  There must obviously be disruptions in the normal shipping patterns this year.  Of course, the trade fight with China is disruptive.  But, the biggest factor, by far, seems to be the excellent growing weather we had this past summer.  And, nothing you have posted points to anything other than a full pipeline with low prices on one end and much higher prices on the other end.

Cattle marketing appears to be showing the same thing.  Packer profits have been unprecedented.

Why have we not seen corn basis reflect the same issues as beans.  

Comparitivly  the supply of corn is every bit as big as the supply  of beans.  Yet national basis levels are running tighter this year than the 4 year avg. By about .05  a bu. VS beans which are running .65  a bu. Wider than the 4 year avg.

For some odd reason you seem to believe that $8.85 cbot  beans  are expensive  when in fact  we are looking at possibly  the lowest 6 month avg bean price in over a decade if things  don't  change  soon 

just a second on the corn basis....seems northern Iowa and  s min where the crop is usually huge have had mostly crap and the report is basis  not good but from reliable sources up there {and I have many} "on fire" and many insurance claims on corn

For some odd reason you seem to believe that $8.85 cbot  beans  are expensive  when in fact  we are looking at possibly  the lowest 6 month avg bean price in over a decade if things  don't  change  soon

I was going by your numbers - $9 vs. $7.  I didn't even check.

But, your assumption that I think beans are expensive at $8.85 is just that - an assumption.  I do think $9 beans for future delivery would be expensive compared to $7 cash beans - and that there should be a logical explanation for the difference.

While the similarities to Canadian shale oil are not exactly the same, there seems to be a parallel too.  I've heard prices for Canadian oil from $20 to $30.  The poster was complaining about the US robbing the Canadians.  But, the pipelines are full - apparently just like soybeans - and the local market reflects that.

Comparing Corn and Beans isn't even applicable.  Beans are at record storage around the world.  Corn is not even close to record storage, so that argument isn't valid.  

cfdr is trying to use every thing imaginable  to frame this as a supply problem  cattle. , Canadian  crude and your objection is with looking at it against corn.   That's laughable.  

Corn and beans are very comparable  how they act on the futures and in the cash market are al.ost fixed add to that how they directly  effect the freight markets is almost as if they are joined at the hip.

But carry on

cfdr is trying to use every thing imaginable  to frame this as a supply problem  cattle. , Canadian  crude and your objection is with looking at it against corn.   That's laughable. 

Laughable?  That's what you say when you run out of stuff to throw against the wall that doesn't stick.

Eith basis levels almost double what is normal leaving cash paid to the farmer barley in the 7.00 dollar range. That's 3 dollars  a bushel  less than last year

Translation - beans are cheap.  Must be Trump's fault.

The average rate of acres over the last 20 years has  been under  5 %  yes added production is a problem by farmers the fact that the US farmer is holding all the ending stocks is a Trump administration problem.

Jim_M points out that 5% per year over 20 years is significant.  But you maintain that "ending stocks is a Trump administration problem."

The US pipeline is full, The China pipeline is sucking air and that is the problem. Your failure to understand this is typical of traders vs marketers

Don't know how to respond, other than you don't give any indication you understand either trading or marketing.

It would be reflected in the cost of Freight.  .  .  cars to the PNW  .  .  .  That tells anybody who understands freight that it's not a supply issue it is a demand issue.

Translation - ok, let's use PNW freight that is probably most affected by China and generalize that, once again, it must be Trump's fault.

Why have we not seen corn basis reflect the same issues as beans.

Translation - This isn't working like I thought, so I'll try to throw this at the wall and see it it sticks.

(It doesn't.)

For some odd reason you seem to believe that $8.85 cbot  beans  are expensive  when in fact  we are looking at possibly  the lowest 6 month avg bean price in over a decade if things  don't  change  soon

Translation - I think I'll try to throw this at the wall again.  Cheap prices must be Trump's fault!

Corn and beans are very comparable  how they act on the futures and in the cash market are al.ost fixed add to that how they directly  effect the freight markets is almost as if they are joined at the hip.

You're not an analyst or a trader, are you, frey?  You're just throwing stuff against the wall and hoping something sticks.

Of course, the tariffs affect the market.  Are they a significant driver?  You don't know, do you?

But, again, it just has to be Trump's fault!

cfdr is trying to use every thing imaginable  to frame this as a supply problem  cattle. , Canadian  crude and your objection is with looking at it against corn.

The thing that the cattle market and the Canadian oil market have in common with beans today are that the price differentials are saying that the market is trying to do its job.  The price differential between the producers and the end users is wide enough that the market is suggesting that it could be profitable to build more pipeline capacity.

This is what the market is supposed to do.