Beaks, Muzzles & Snouts

One year ago, I noted a couple private estimates for August 31 corn carryout at 560 million bushels. Currently, the broiler egg hatch is reduced by 6%, there are 5% fewer cattle on feed, the swine population is down 4%; the just completed January through March period evidenced a 120,000 head increase in dairy cow slaughter compared to the same period of 2008. The October-December 2008 calf slaughter was 46% higher. Carry out estimates approach 1.7 billion bushels. The ethanol industry appears defensive. A long time ago, a successful old timer on the floor of the CBOT advanced counsel to observe the price trends of both black pepper and corn as an indicator of future inflation. The intrinsic value of corn is the sum of corn products: cereals, syrups, alcohol, meat milk & eggs and now, ethanol. Cattle prices are not yet profitable. Hog prices have collapsed. The swine industry is a disaster. As of March 1st, ag producers on-farm inventories: corn +8%, Sorghum +23%, Oats -3% & Barley +55.8%. While a lot of observers caution inflation is just around the corner, I would personally prefer to own a tangible consumable commodity versus gold; it appears to me, time is yet a friend.