FBN marketing recs
So a week or two ago FBN came out with estimate of 169 bpa on corn. (Didn’t know acreage estimate). Today new rec to go long? Feel that is contradicting. Obviously things change but feel free to explain/discuss.
Thanks for the question. FBN crop marketing is constantly evaluating key drivers that influence price. Our yield model a few weeks ago was at 169 but has come down as a result of deteriorating conditions. The map shows yield vs trend and highlights some of the key regions that are struggling.
And of course, this year also has the added wildcard about corn and soy acreage that got planted. USDA will weigh in on Monday on acreage.
Our actual rec was a structure that re-owns part of the crop for limited risk, but unlimited upside potential. With the market in the low $4 territory we think the upside potential outweighs the downside risk. That would not be the case if market prices were $4.50-ish. Our actual rec allows for capturing that risk/impact on yield from weather without providing significant downside losses.
This evening at 6 PM CDT we will be doing a webinar highlighting our perspective ahead of USDA's report on August 12th
Good info, thanks for sharing
Hind sight being 20/20 looks like FBN was correct at 169 according to USDA.