The Rural Voice, 1983-07, Page 6Hampshires and Durocs
Registered, R O P , Breeding Stock
Purebred and Crossbred
LODON ACRES
Don Johnson & Son
R.R. 2, Mildmay
519-367-2111
12th Production Sale
MAXIMUM GENETICS
FOR
MAXIMUM PROFIT
Thursday,
July 14
1:30
Stratford Fairgrounds
50 bred -50 open gilts
25 boars
"Come end see some of the best"
SWINE
Ltd.
R.R. 3, Tillsonburg
519-842-3225
519-462-2580
PG. 4 THE RURAL VOICE, JULY 1983
FARM MARKET PERSPECTIVE
by John DePutter
(This column was prepared on June 14,
1983)
ANALYSTS HAVE BEEN CLOSE TO THE
MARK ON CATTLE OUTLOOKS LATELY.
Looking back to last fall, U.S. Depart-
ment of Agriculture (USDA) analysts
were expecting firm prices with spring
tops on American cash markets of $69 or
so. Many private analysts agreed. Both
sectors pointed to only slightly easier
prices into the summer, but significantly
lower markets by late summer or fall.
These outlooks have proven reasonably
accurate. If the consensus continues an
accurate course, we could see a $5 - $7
slippage or more moving into the 3rd and
4th quarters.
THE "EXPERTS" HAVE BEEN BADLY
WRONG ON HOGS, THOUGH. USDA
analysts and many private firms were too
bullish. On June 13 Washington officials
came out with new predictions, noting
that the usual summer price rally didn't
materialize. Second quarter average lev-
els of $47 (U.S. cash) are now expected,
compared to the previous estimate of $49
to $52. USDA now projects 3rd quarter
average prices of $49 to $53, with 4th
quarter averages of just $44 to $48. In
retrospect, the long term bar charts,
clearly pointing to a major cyclical
bottom in 1983, gave better forecasts
than the fundamental analysts.
HOG AND PIGS REPORT TO GIVE
CLUES. The quarterly hog and pig supply
count by USDA, set for release on June
22nd, could set the pace for the 3rd
quarter of 1983. Private firms doing
surveys in advance of the report appear
(to date) to be finding only modest
cutbacks in expansion plans. They see
very few signs of any breeding herd
liquidation in the U.S.
McDONALD'S RESTAURANTS RE-
EVALUATING THE McRIB. If the fast
food chain cans the pork sandwich, it will
be a blow to pork demand. "They're
entering into an evaluation period, but
the decision has not yet been made,"
said Russ Sanders, a spokesman for the
National Pork Producers Council in the
U.S. "Even if they do decide to drop the
McRib, there's been a tremendous
amount of positive (use) generated for
McRib-like products," said Sanders, who
participates in research and development
of fast-food products.
OLD CROP CORN SUPPLIES ... IN
TIGHT HANDS Buyers wanting imme-
diate corn supplies have bid prices
steadily higher in the U.S. and Ontario. In
the U.S. some analysts think the market
is hungry enough to reach for the $3.15
reserve trigger, at which point about 300
million bushels of locked -in stocks are
eligible for release to the open market.
Currently, the national average price of
corn to the U.S. farmer is 7 cents under
that trigger, at $3.08. Strong basis levels
persist in the U.S.; and in Canada too.
Many Ontario elevators have posted
board prices of just under $4.00, and the
f.o.b. farm pick-up bids have been over
$4 for some time.
NEW CROP SUPPLIES IN THE U.S.,
HOWEVER, ARE EXPECTED TO BE
AMPLE. Carryover when this marketing
year is finished in the fall is pegged at 3.4
billion bushels by the USDA. Right now,
much of that is locked away in govern-
ment programs, but by fall much of it will
be free to open markets. Add to that an
expected crop of just over 6 billion
bushels and fall supplies look ample.
That's why new crop bids suffer such a
discount to cash bids.
ONTARIO CROP SUFFERS BADLY.
Some farmers on clay soils didn't turn a
wheel until the week starting June 13.
Late planting could knock Ontario grain
corn production by one-third, according
to some farmers and elevator operators.
Result? A stronger than usual basis
during much of the upcoming marketing
year. (Basis refers to difference between
Chicago futures and local price.)
WORLD COARSE GRAIN EXCESS TO BE
REDUCED BY LATE 84. Ending stocks of
world coarse grains this year will be a
burdensome 151.5 million metric tons,
according to USDA analysts. But by the
end of the 1984 marketing year, carryover
will be clipped to 116.4 million metric
tons, given normal weather.
SOYBEANS: A BEARISH MAIN
COURSE: The recipe for lower prices
included a stronger U.S. dollar, and
bland world demand. Mixed in came
higher than expected acreage in the U.S.
Add to the concoction a bailing out of
"long" speculators in early June. The
result was a rather unsavory price dip.
Finally, on June 13 the U.S. government
served up a bearish platter ... reporting
that carryover in this marketing year will
be a record 440 million bushels, and next
fall's carryover could be a burdensome
355 million bu. of soyas. It's hoped this
last report will put a summer bottom in
the market and that we can enjoy a more
palatable summer rally for dessert. One
analyst, Jim Gill, said in a recent
interview there's a chance for strong
rallies in 1984, given the demand base
that's building from these consistently
cheap prices.
DAIRY: IMPROVEMENT SEEN BY MILK
BOARD CHAIRMAN. "There are a few
producers writing to us (about financial