Peosta, Iowa Seminar - February 11, 2009
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    Peosta, Iowa Seminar - February 11, 2009 Peosta, Iowa Seminar - February 11, 2009 Presentation Transcript

    • © Roach Ag Marketing, Ltd. Grain Price Outlook and Market Strategies Peosta, Iowa by John Roach February 11, 2009
    • © Roach Ag Marketing, Ltd. Why were grain prices so high?
    • © Roach Ag Marketing, Ltd. Population Growth Rates Source: USDA Agricultural Projections to 2017.
    • © Roach Ag Marketing, Ltd. Global Meat beef + pork + chickens & turkeys Production, per capita consumption, and population Source: USDA Agricultural Projections to 2017.
      • Dollar Index
      © Roach Ag Marketing, Ltd. Dollar Value Down 40% Since 2002 Peak
      • DJ / AIG Commodity Index
      © Roach Ag Marketing, Ltd. Index Up 180% Since 2002 Low
      • DJ / AIG Commodity Index Composition
      © Roach Ag Marketing, Ltd.
      • Energy: 37.6%
      • Livestock: 6.97%
      • Grains: 16.57%
      • Base Metals: 19.54%
      • Precious Metals: 8.99%
      • Softs: 7.59%
      • Soybean Oil: 2.74%
    • © Roach Ag Marketing, Ltd. What happened to cause prices to drop?
    • © Roach Ag Marketing, Ltd. USDA 2008 World Corn Yields 6/10/08 149.0 Bu/Acre U.S. 87.6 Bu/Acre Chinese 78.1 Bu/Acre World 60.1 Bu/Acre Non – U.S.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd. There will not be enough money to raise crops this big next year
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
      • World coarse grain ending stocks tight
      • U.S. ending stocks expected to loosen
      • Exports off to slow start
      • Ethanol demand slowing
      • Yet, we still need a big corn crop every year
      • Price peak due in Mar – June in 2009
      Corn Situation and Price Outlook
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
      • Shrinking 2009 & 2010 crop in S. America
      • Demand is surprising market
      • US stocks very tight
      • World soybean ending stocks tightening
      • Prices currently tied to S. American weather China and spec demand
      Bean Situation and Price Outlook
    • © Roach Ag Marketing, Ltd. How Should I Market My Crops?
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd. Roach Ag Sales Plan
      • Make as many of your sales as possible during the months of March, April, May and June. Avoid October and November
      • Sell in increments to take advantage of several market peaks using Roach Ag Sell Signals
      • Buy puts on unsold new crop production with either profit goal or insurance goal
    • © Roach Ag Marketing, Ltd.
      • Focus the majority of sales in the 1 st half of the year
      • March through June is usually best
      Rule # 1
      • December 2007 Corn
      © Roach Ag Marketing, Ltd. Both Lines Over 75 = Roach Ag Sell Signal
    • © Roach Ag Marketing, Ltd. Roach Ag Sell & Buy Signals Your Digital Thermometer For Prices
    • © Roach Ag Marketing, Ltd. Roach Ag Sell Signals When Both Lines Are Above 75 = Sell Signal
    • © Roach Ag Marketing, Ltd. Roach Ag 2007 Corn Sell Signals 56 Days of Sell Signals ($3.91) and 272 Days Without ($3.71)
    • © Roach Ag Marketing, Ltd.
      • Sell only when markets are giving us a Roach Ag Sell Signal
      Rule # 2
    • © Roach Ag Marketing, Ltd.
      • Figure out the percentage of bushels you are comfortable selling each and every spring and tie that % to the your crop insurance policy coverage level
      Rule # 3
    • © Roach Ag Marketing, Ltd.
      • Make sure you have enough on-farm or other owned storage to hold the balance of a crop using your best ever yields
      Rule # 4
    • © Roach Ag Marketing, Ltd.
      • Make sure you sell enough in the spring prior to harvest to generate necessary cash-flow from harvest through February
      Rule # 5
    • © Roach Ag Marketing, Ltd.
      • Split your old crop bushels and new crop contracts into between 3 and 5 increments and sell one increment of each on each Sell Signal
      Rule # 6
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd. Put Opportunity - Buy Puts on some of the Crop You Do Not Want to Sell on a Cash Contract
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd.
    • © Roach Ag Marketing, Ltd. Roach Ag Marketing Plan Worksheet
    • © Roach Ag Marketing, Ltd. Roach Ag Marketing, Ltd. 7601 N. Federal Hwy Suite 265-B Boca Raton, FL 33487 800-622-7628 [email_address] http://www.roachag.com