£200 wheat before Christmas?

[4course]

in general the farmer thinks or hopes it will go up whereas the merchant thinks or hopes it will go down therin lies the dilema

 

[bankrupt]

the highest volumes offered by farmers at the bottom of the market & the lowest volumes offered at the top!

This surely can't happen any more, Brisel.

Sales volumes negatively correlated with prices is soooo 70s thinking.

 

[4course]

theve been back on the phone today up a tad more ,have I the courage of my convictions or willpower to hold on or do I ask them to sell if it drops £4 as that whats its risen since last tempted, that as they say is the question

 

[Iben]

theve been back on the phone today up a tad more ,have I the courage of my convictions or willpower to hold on or do I ask them to sell if it drops £4 as that whats its risen since last tempted, that as they say is the question

Be brave!

 

[Brisel]

Calculate your cost of production now you know the yield. Sell if it is above the COP. It's harder to go bust when you're locking in a profit.

 

[Flat 10]

If you were happy with it at the time, then you did the right thing.

Never beat yourself up about past grain sales. People who do, tend to go on to be nervous to ever sell, and their long term habit becomes one of selling late, and often missing the market spikes.

I was earlier on. I felt forced into selling last spring as I was worried about quality in my ancient sheds and that was when wheat was ~103. Luckily quite a bit was sold earlier at £11x. Generally I am quite decisive and have sold quite a bit of 17 harvest. I don't beat myself up either.

 

[bankrupt]

It's harder to go bust when you're locking in a profit.

2017 yields not yet to hand, unfortunately.

As to beating oneself up, my biggest regret to date was not on price but on quantity

Selling 60% of 2012 forward not being a great success, in hindsight.

 

[Condi]

If you mean buying Options, I've not been able to find any that aren't prohibitively expensive for the last couple of yaars.

Define 'prohibitively expensive'?

I would argue some options are very cheap at the moment. The futures price is not expensive, the time to expiry doesnt change from year to year, so that only leaves volatility and its not a particularly volatile market - from memory rapeseed options are about 16% vol on the nearby, and 12% on the Nov-17.

Where they are not cheap is London wheat options because the liquidity isnt there, if you want to buy some you've got to pay up to the seller. I think Nov-17 options are about a tenner for wheat and £15/£16 for rape.

 

[bankrupt]

not cheap is London wheat options.

I agree with Flintstone.

It's rigged.

Stay clear.

 

[Condi]

I agree with Flintstone.

It's rigged.

Stay clear.

Its not rigged at all, its incredibly transparent if you know what to look for. The reason they are expensive, as I said, is because of low liquidity, not because they are 'rigged'.

But dont let facts get in the way of your anger against the world.

 

[Flintstone]

In fairness, I've never said it's rigged! I just said it's quite an expensive marketing tool. That's all.

I did something last year which allowed me the average price over a 6 month period on a small (300 tonne) parcel of wheat.

I could fix a minimum base price, and it cost me £4 per tonne to then achieve the average over 6 months. I watched the market eagerly over that period. When the 6 months was up I received my cheque for the uplift.

It was for £28.

 

[David.]

£28 per ton is pretty good for last year

 

[4course]

£200 at xmas !! but what about £150?

 

[bankrupt]

The reason they are expensive, as I said, is because of low liquidity

Cart and horse, Condi.

Low liquidity is because of too few punters (ie at today's prices, not enough mugs).

Before the GFC (Great Financial Crash) in 2008, wheat options were often very good value.

What exactly's happened to mess the whole system up, and why?

 

[Grains Guru]

Lot of volatile markets since then. Those with cash invested in safer returns, those without chased the 'profits' on the markets and got burned. That's why today we see a lack of volatility in markets like options in UK Agricultural trading. Plenty going on in AG options in U.S and Matif (Paris futures) markets but then that opens a UK punter to another twist in the volatility stakes.

 

[focussed]

I think it's safe to say that £200 before Christmas is unlikely....

 

[Midnight plough boy]

I think it's safe to say that £200 before Christmas is unlikely....

I'm going to sell a few loads on Monday but will really kick myself if the price rises by the best part of £70 in the next three weeks!

 

[David.]

Sell two loads a week into the rise.

 

[Flintstone]

With the £ gaining some momentum now, I can't see it going up for a long time yet.

As I said a few weeks ago, I do hope people took a big chunk of cover at £130.

 

[turbo]

With the £ gaining some momentum now, I can't see it going up for a long time yet.

As I said a few weeks ago, I do hope people took a big chunk of cover at £130.

Once they press the article 50 button it will drop again, the suits think it's not going to happen or a least delayed