7 Silver Linings For Ag In 2016

[SASKFARMER3]

The agriculture industry isn’t all doom and gloom, says a post on agweb.com.
“Yes, conditions in agriculture are tough, but there are a few good nuggets buried in the bad news,” ag economists David Widmar and Brent Gloy write in their latest “Agricultural Economic Insights” blog. Specifically, they point out seven positive trends that could inject a bit of optimism into farming this year.
1. Fertilizer prices are down.
2. Fuel prices are down.
3. Fixed costs are in decline.
4. Interest rates are still historically low.
5. Inflation is low, too.
6. (US) Farm income forecasts only show modest declines.
7. The (US) farm financial situation remains resilient

So this is the propaganda the USA is writing to keep US farmers from pulling the plug.

Well in Happy Canada we have two out of the 7 that are wrong.

Our Ammonia price is higher than last year by $3.00 a acre. Our phos and nitrogen are up a bit.

Equipment don't get me started has gone through the roof. No combine that is new is worth $700,000 only to sell at RB a couple years later for $200.

But the big interesting thing after the Easter weekend is how weak the Cities are getting in Alberta and Saskatchewan.
All family traveling home from Alberta said its pins and needle time. Layoffs are coming but when. Car dealers lay off people construction companies with only one project. Other companies with trying to keep cost of new homes at current levels but cheaping out. Welcome to the White baseboards and cheap counter tops and no insulation in garages.
Electrical, plumbers, oil truck drivers Carpenters mechanics etc.. All is slowing down.
So the Billion dollar question of the day.

Agriculture is it really worth spending Billions to produce a crop that no one wants to pay us anything more than 1970 prices with 2016 costs.
Yea its a win win.

[sumdumguy]

SF3, produce more for less - that way everyone can make more money- except you. More chemical, that's the answer. They'll lap it up, those hungry dogs. Hamsters on a treadmill.

[ajl]

Most of that is true for the US. They are using the reserve currency so they are dealing with cost reductions and becoming more competitive. Different world in Canuckistan. We are waiting for the government to trash the $Cdn down to 0.60 to save the economy here. Very few throwing in the towel on either side because what else are you gunna do? Good paying jobs have gone the way of the dinosaur (unless your connected in governmnent). Surprised how much pasture, hayland, general junk ground going into production for here in Central AB.

[bucket]

It's getting to the point where it would make more sense to sell out.

Explain it to the kids that they get help when they need a house.

Get them into a good job like laser alignments or predictive maintenence and enjoy life.

Everyone from the US border to laronge is growing lentils. It will be a bitch to get a grade or move a 40 cent contract when the graincos are buying 8 cent shit this fall. And you have to only look back 2 years to find out how long graincos will delay delivery to their benefit.

Ask yourselves this ..... is the grainco and railway system any better prepared to handle a large crop? If so what has changed since 2013?

[bucket]

You have fertilizer produced at Belle plaine worth less at nola but can't get a price reduction.

You have grain produced at Belle plaine worth more at the west coast but can't get more.

Both are commodities but have exact opposite pricing mechanisms.

And yet the smarties of the world say it all makes sense because the masses buy into their excuses?

[farmaholic]

Bucket, in both of your examples we are at the extreme wrong end of the transaction.

Absolute end user for the fertilizer.

Initial source of the grain.

Vertically integrate? Like all the other successful mega farms?

[bucket]

Belle plaine is the initial source of nitrogen for a large area.

Also a large source of potash that is cheaper to buy in India than locally.

[farmaholic]

What ever the market will bear.....

[bucket]

Ok your just begging me to say this .....


Stop drinking their kool-aid. FFS.

Nitrogen is produced with natural gas that is currently so worthless they are flaring it off.

[farmaholic]

Maybe what I called it is a politically correct way of saying; gouging, collusion, price fixing, unfettered capitalism...

??????????? I don't have any other explanations other than "what ever the market will bear".

[tweety]

Ok your just begging me to say this .....


Stop drinking their kool-aid. FFS.

Nitrogen is produced with natural gas that is currently so worthless they are flaring it off.

So any normal business would build a fertilizer plant then. But farmers are way too pig headed and independent to ever work together.

[theplowboy]

One silver lining is the Cdn dollar down around $.76 USD.

It is helping move Canadian grain into export markets.

[Horse]

Farmers are thier own worst enemeys you put on more fert and get bigger sprayers so you can try to farm the whole country and then bitch about the cost of imputs, Never in over 50 yr of farming has anyone put a gun to my head and said buy more inputs or else. If no one bought them 700K combine they wouldnt make them would they so whos fault is it , if everyone wasnt so greedy and wanted it all, life would be a lot saner.

[bucket]

Sure are moving grain with boats floating to the same number as back in 2013.

2.0 mmt space floating. But because the BDI is low and so is demurrage .... who really gives a ****?

We are in the same crisis as 2013 and most are sleeping in Ottawa.

[Hamloc]

Watched the results of a couple farm sales on Rbauctions. At first sale 2 John Deere S-680's sold for 265000, I think 14's with just over 500 hours. Second sale 2 s-680's sold for 385000 each. I think around 300 hrs. I am going by memory but the 120000 difference per combine seemed a bit fishy to me. Dealers want over 450000 for the same combine, looks like they pushed the price up to make their price on used make sense, any thoughts?