Welcome into the Friday, January 19, 2024 installment of Marketplace Smart and still with us.

Sue, you had a lot of people wanting to know on Facebook.

Thank you.

By the way, everybody who contributed questions this week.

A lot of questions about they want the sunshine.

And I asked you, I slipped the sunshine.

Word in the analysis show will get into a couple of very bullish questions.

They want to hear from you in a minute.

But I want to start on the global side first.

And this is Bradley in Nebraska.

He says after the introduction of the BRICS currency, the U.S. dollar has remained strong.

How has the BRICS performed relative to other currencies?

Is BRICS gaining favor with other trading partners?

No.

I think you've got countries around the world that are still wanting to trade in dollars.

China and even the BRICS amongst themselves.

You know, you have countries within there that don't want to part from their own currency.

China be one.

And I think that I don't see the BRICS currency doing anything very soon.

And you talked a lot about global issues in our analysis today.

I mean, I had a hard time keeping up with all of the countries you were going to.

But I mean, it is become such a global issue.

So I guess, though, this is more of a local issue.

And when you drive from here to there to everywhere, there are places.

This is the big question after last week's report and I had it after our show last week.

John in Iowa wants to know, so where are these piles of grain?

Do they exist?

Well, there are some out there, but I have to say, they aren't as many as you would think for what the USDA said.

I, I struggle, I think two things.

One, Illinois and Indiana caught rain when they needed it.

It came timely.

And so they have some pretty good yields.

Nebraska for all the heat, but they have irrigation.

I think there were producers that were pleasantly surprised that they had a better yield.

But was it record or well over?

IPH No.

In Iowa, yields were good.

Farmers are happy because they were expecting this drought.

So consequently yields were good.

But were they record?

No.

But you said during the week discussion about the number of percentage crops still on the farm.

What's the percentage for the corn crop right now?

Say that out loud.

68% as of January one.

And that's not good news.

And the end user, such as ethanol plants or what have you.

They know that.

And they're not willing to bid to aggressively, although this cold weather did when farmers had their yard snowed in and the been snowed in.

Nothing moved too well.

Roads needed to get back into shape and and snow removal.

So now they'll maybe start catching some farmers selling.

But to be honest, I, I seen fairly consistently quite a few different ethanol plants that were chewing through their plentiful supply.

Okay.

So then that ties into our next question.

Scott in Wisconsin wants to know, see if I haven't priced corn ahead in 24 at a profit, why should I grow it at a loss this coming year?

Given what you just said about all this corn still on the farm?

Well, farmers are optimistic.

They have to be or they wouldn't farm.

And one thing I will say, if you look back at our last summer and the dryness and what have you, I think one thing that came into play that we underestimate is all that cloudiness or haze that we had out of Canada, that and it encompassed, you know, Illinois, Iowa, Minnesota, Wisconsin, then Nebraska.

And I think that that haze blocked some sun.

We could have had a lot hotter temperatures that we didn't get.

And also pollination.

I remember pollination.

It was beautiful, perfect conditions for pollination.

That's 90% of your corn yield.

So I think.

But here's the kicker.

Now, the farmer didn't sell the you know, they're looking at at that crop and thinking, how can I sell?

I might not have enough.

They were worried.

So they didn't make sales.

Now they're looking at Brazil and seeing what's happening down there and the price goes down and they're thinking, well, boy, that hasn't stopped things.

I guess what I wonder is, you know, 25 is supposed to be a hot, dry year, probably the worst one if that occurs.

Will farmers sell?

I wonder if they'll ignore the the drought and say, well, God, the last time I did this, I messed up and I should have.

And they might sell their crop a little too quick.

But and the old fashioned comes back.

So I don't know.

It's interesting, but.

It is to think about and we already have 25 on the board and there's we I don't know if I put it in this week.

We had a couple of people that were asking about some 25, 26 things.

But this one, I want to go back a little wider in scope.

This one is Boyce in North Dakota.

And his question for you, Sue, is if this situation in the Middle East intensifies again, something that could happen in 24, 25 and crude oil prices spike, could that have any effect on fertilizer prices?

And he wants to know, especially in urea.

Well, it could you know, it certainly could, because it'll impact on energies.

But I will say this one thing with that Red Sea situation, of course, we already know it's creating a problem with shipping big time logistics.

Some of the U.S. exports are having to go around the the horn, the cape, Horn cape.

Let me try that again.

Whatever.

Anyway, long story short, China is building a three and a half billion dollar port on the Pacific coast of Peru.

That takes away two weeks of shipping time.

And they don't have to go through the Panama Canal.

And it will very much compete, I think, with our West Coast ports in the U.S. That's a concern because Brazil on the western side of Brazil, they're going to be able to export beans pretty easily through that.

And that's going to be Chinese says going over to Asia.

So we could see further erosion.

Yeah.

And premium opportunities because of that for years, too.

Okay.

What about the cattle producer?

We talked a little bit about their outlook and this one is specifically Jimmy in Oklahoma on Facebook wrote, How is a cattle producer going to make things work today?

Well, I think what you need to do, you know, I believe the markets can still catch a little more lift in here.

But I would be a little nervous.

You know, our cut outs kind of taking a hit here this week.

What you think because the weather abated.

But look at restaurant business.

It's down.

You know, demand for beef.

But what I would do if these cattle prices and feeders get up, like, say, April gets up around 180, maybe 181.

But I wouldn't wait for the 181 or the march feeders get up towards, say, 145, 148, maybe 150 ish.

If I can do that, I would boy, I would be buying puts.

And, you know, I'm the eternal optimist when I talk about $30 beans and, you know, $40 wheat or whatever.

But I would be getting puts and putting flooring under those cattle because I do not think that we're done with this down side of the market.

And that's all across everything.

I would say that's and feeders.

I even think the hog market may be vulnerable yet too.

But we may I think we could have a decent April.

But I worry about as we get more into summer and I just I just course I'm coming at that with a little bit of technical ideas, but I just think this market's giving you a rally here.

Get some puts that way if it turns tries to even get more enthusiastic, which I'm not sure I, I expect then at least you have a floor and you can work with the cash market.

But I would very much say give some hedging.

Done.

I want to thank Duane, Dan, Kurt and Andy for your questions.

But I want to ask one last one here about grains.

And John Roach always likes to talk about everybody being on one side of the boat in grains as a whole.

It sure seems like everybody is on the bear side of the boat.

Heavy short.

What point do you make the move?

What prompts that move to happen?

Back to the bullish side.

We talked about multiyear lows in many of these commodities.

Give us some sunshine if it's there at all.

Well, I think one thing you know, you have if you combine corn, soybeans and wheat, you know, they're as short as they were since 2006.

So you have a heavy, heavy short position.

It's just like the bulls side, you know, when everybody believes the story and is on board.

All it takes is something to start triggering.

And I think we're going to see some lifting of short positions here as we go in towards May.

I you know, years of a 410 and I have data going all the way back to 1914.

I did a that I took from 1914 and all the years they do tend to be more traditionally season.

You know, they follow a seasonal path, the snow guarantee.

But they do tend to be very traditionally seasonally.

So that kind of gives you some clues as to where you pick your marketing spots.

And I was on a on a site on Facebook, and I was looking at it was a merchandizing commentary site and merchandise discussion and it was interesting to read all the comments.

There was a lot of emotion and I mean really emotion and like, there was never going to be another good day and really low balling prices.

And I thought, you know, that's usually a good sign.

So brighter days ahead.

That's right.

I think there is.

I don't see the market just explode.

There's nothing like that here to give us that one thing I will say, I think we're going into a very cold spring.

We have an early Easter this year, and I think we're going into a very cold spring.

One that could bring us some freezes and so be rushing in and trying to get that crop planted early might not be the best thing.

Well, one of the best things is when you come to visit us.

So.

Well, thank you.

Good to see you.

Thank you, sir.

Martin.

Thank you very much.

That's going to do it for Marketplace.

Next week on the program, a professor hunts for unintended changes from genetic editing.

And we'll have the commodity market analysis with Shawn Hackett.

Thank you for joining us and have a great week.