Predictions and Observations

[biglentil]

Uranium

[BTO780]

Nice way to start the new yr, everything in the red. When will this blood bath stop?
If this keeps up there will not be much left of these markets come spring.

[bucket]

Nice way to start the new yr, everything in the red. When will this blood bath stop?
If this keeps up there will not be much left of these markets come spring.

Won't be much for coverage with the premiums we will be paying.

[Grahamp]

1. The top may well be in for canola for quite some time. I certainly don’t see north of $20 anytime soon. Where we end stopping and chopping is hard to say but $13-16 seems like could be the new reality.
2. Spikes are still possible but I agree once a bull market has ended sustained rallies are so much harder.
3. I’m not sure if this one. Land rents may have topped out and may even decline a bit especially in some areas where there appeared to be pure insanity. But land prices? I doubt they’ll drop much if at all. I think you are underestimating the extraordinary profits made by many farmers the last 2-3 years. I understand that for many there has been drought,grasshoppers and extreme frustration at not being able to take advantage of the high prices. But there are large parts of the prairies that have made $100-$400 per acre for the last 3 years. Let’s think about this with dollar figures and then without. So you’re a 5000 acre farm and you just made $300 per acre or 1.5 million. The Saskatchewan market for land (outside of Regina plains) is let’s say 400-600k. So you made enough to buy 3 quarters with cash or roughly increase your farm size 10%. Some farms have had this 3 years in a row. Let’s remove the numbers so inflation and historical ZIRP don’t cloud our judgment. Is being able to increase your land base 10% with the cash profit of one year a good deal? I would say yes. So in some regards the price doesn’t matter because frankly they can print money faster than any of us can imagine. Even if Errol’s deflation dream comes true I think most of us would be happy with this as a yearly outcome regardless of what the actual number is. Making $300,000 when land is $100,000 a quarter or making 1,500,000 when land is $500,000. So I don’t think land is going down.
4. I think you could be right on this one. Some of the combine prices we are seeing reflect unsustainable depreciation. At the very least I think not only flipping but even the prospect of owning new machinery has passed for many farms. Taking 2014 as an example, flipping yearly made sense for even a 10000 acre farm. Now I don’t even know if it makes sense for anyone except the ultra large. (Hard to guess what kind of deals 40,000+ acre farms are getting) But I think the historical occasional new purchaser on say a 5000-8000 (tel:5000-8000) acre farm is now going to find themselves buying 1000 hour combines and 2000 hour tractors at least those who are paying any attention to what depreciation costs.
5. Interest rates. I sort of disagree I don’t think rates will go too much higher and probably we’ll see a cut in 2024. I also truly believe what FCC may or may not have done 40 years ago will have any impact on what they do today. Lastly I doubt very much any farms will go broke. I know the schadenfreude is very strong is almost every farm community. And it seems in almost every area there seems to be a strong desire to see the most aggressive farmer go broke. I am 44 and for the last 20 years have heard on this board and at farm meetings and everyday conversations that someone is going broke etc. Farms almost never go broke. There is just too much equity built over too long a period of time, especially with crop insurance and agristability capping losses.
6. No question crop insurance will be down especially in the bad areas. But don’t underestimate the enormous margins being built in the good areas that will be protected by agristability. MNP in particular knows this program well and has a disproportionate number of 10000 acre + farms as clients.
7. Yes Russia has won. Unfortunately the west will keep sending money for a few years via the printing press.
8. Farm Turnover. Heard this my whole life won’t make any difference. If anything transfer of enormous wealth to younger more aggressive farmers may even cause greater increase.
9. Federal government. They are incompetent and hate farmers. We are in their crosshairs no doubt.

[BTO780]

The world will be at 8 billion people this yr, will be lots of cheap food to feed mouths.

[wheatking16]

Anticipate a 1-4 week pullback for the following:

US Homebuilders (XHB)
DOW (DIA)
NASDAQ (QQQ)
S&P (SPY)
20- YEAR (TLT)
US Financial (XLF)
Russell 2K (IWM)

M2 could get a slight increase here.

It is only Day 1 but keep an eye on these.

[errolanderson]

Apple shares plunged in-excess of 4% on 1st day of trading in 2024. Not a good look for 'rip-roarin' money-chasing-money equity markets. The exit door had better not be locked.

[errolanderson]

Was the peak in U.S. stock markets for 2024 . . . January 2nd?

[westernvicki]

I have that tune in my head:

"all good things must come to an end, it was the same for the wildwood weed..."

Been a wonderful boom, time now to know your numbers and have some off farm balance for fun!

The course is changing, it always does.

Control the things we can and ask for more accountability of farm organizations who will need to represent us better in ag. policy.

[errolanderson]

Vicki, major meltdown in Hang Seng and China stock markets overnight. Asian fallout could topple North American equities. We may all know soon.

This situation very bearish crude oil. Now a huge challenge for OPEC cartel to keep its glue together. U.S. oil exports feasting . . . .

[furrowtickler]

I have that tune in my head:

"all good things must come to an end, it was the same for the wildwood weed..."

Been a wonderful boom, time now to know your numbers and have some off farm balance for fun!

The course is changing, it always does.

Control the things we can and ask for more accountability of farm organizations who will need to represent us better in ag. policy.

Was a wonderful boom for those that had good crops yup

[bucket]

I have that tune in my head:

"all good things must come to an end, it was the same for the wildwood weed..."

Been a wonderful boom, time now to know your numbers and have some off farm balance for fun!

The course is changing, it always does.

Control the things we can and ask for more accountability of farm organizations who will need to represent us better in ag. policy.

Still no request to any government from farm groups for an export sales report or some compensation for farmers contribution of carbon sequestering.

Farm groups are full of guys that like selfies , patting themselves on the back , and in general terms thinking they did it on their own, forgetting previous generations efforts.

[consuelo]

hey westernvicki. there still are too many that are still sittin' on that sack of seeds...

[blackpowder]

Re-evaluating my stance on farm groups annually. I have no desire to sit on a board. Staying at the table during endless discussion with bureaucrats a thankless yet necessary job. Do most of the delegates have the skill set?

A reality check for me occured yesterday. Tongue in cheek, I was bemoaning not buying a condo in Hawaii 20 years ago. (As if I could have - not.) Other fellow said, "that's if you can afford the plane ticket now".
Point is, we get insulated in our thinking and forget the basics. Endless meetings with peers eliminates a frank recheck of goals.
Basics are ignored as unnecessary. We are told irrefutable policy is coming, so we attempt to mold it rather than disagree with it.
The first explains timely sales reporting. The second, codes of practice and fertilizer reduction.
(I'm a little disgusted)
LBJ said better to be in the tent peeing out than outside peeing in.
Fair enough, but I hear nothing from our groups about policy so flawed, rejection necessary.
Write our own strategy, not debate the tactics of a flawed one.
I confess to malaise after reading glossy articles on the same subjects all of my career. Thinking I may still request a refund. Open to ideas.

[TOM4CWB]

Blackpowder:
Interesting paradox… as I am an advisor for Alberta Pulse… we wrestle at every meeting… especially obvious and encouraged at our local zone meetings, to bring forward resolutions… expressing exactly what you have stated above.

Being that Canadian Farmers are about 2% of the Canadian Population… the art of negotiation of the possible… becomes our realistic end objective…Remembering…Shock value… only goes so far…

Farmers are stronger together obviously… if the 2% of us are fractured…. We become static on the government and power broker’s agendas.

30 years of trials and passion… friends and disappointments…

Better to have tried… offended some folks who have political motivations…and who are less foresighted …

Than to fail to, in good faith , report… …be honestly able to testify …that your kinds of perspectives were and are honestly being brought forward… whether the negative offensives are encountered… or not .

Many Blessings!
All the Best in 2024!