As oil prices "cheapened" (became less expensive) in early August, grain prices tumbled. You didn't think $8 corn and $16 soybeans would go on forever, did ya?
USDA's Aug. 12 crop report brought more bad news for cash grain sellers and good news for those in need of feed. But I'm betting that America's corn and soybean growers will produce even bigger crops of both - especially corn.
No, I haven't been sniffing too much ethanol. As I report in September's American Agriculturist, much of the U.S. corn and soybean crop is looking very good. Yes, there are drowned out spots and fields that missed several million-dollar rains. But, I and my well-traveled friends have seen great looking corn in many places where it hasn't been seen before.
From Illinois to the Atlantic Coast, the corn and soybean crops look awesome -- even double crop plantings. And reports from Nebraska and central and northwestern Iowa and beyond are for potential record-busting yields in many fields.
But what about all those flooded acres in Iowa and Missouri? Media blitzers reporting on that 500-year flood and even Chicago Futures traders missed a key point: Those devastated acres weren't America's prime corn-producing ground to begin with.
As a former Iowa farm boy and farmer, I know the corn-productivity of most of those soil types and what those farmers and their 6- to 16-foot-deep soils are capable of. Many fields - though late-planted - still could yield more than most fields average in the East.
So I come back to a comment made by a Mid West grain market analyst at July's Maryland Commodity Conference: If you haven't started selling your 2008 crops yet, get moving. If you haven't started pricing your 2009 and 2010 crops, what are you waiting for?
Grain market "booms" typically last about three years, he reported. This one began in September 2007. So you're already one-third of the way through this one.
What's that old adage? He who hesitates is lost?