Roach: We love making June sales. We pay close attention to our sell signal indicator. When we get a sell signal in the latter part of June we jump up and down for joy. And we don't really question so much where the price is, we just know it's a good sale, that you're likely to make a peak during this timeframe. When the traders from Chicago go out and drive around over the Fourth of July if the crop looks good in general it's awful hard to get them to be very optimistic. They know that they have made money in most years selling a crop that looks good on the Fourth of July. So, we're pretty much guaranteed almost regardless of the weather that the crop is going to look good on the Fourth of July in 2010 and so we think it's really important that farmers do not get caught up in the bullishness of, well they didn't get it planted in Canada, well the Chinese are buying our corn or all the other potential bullish things out there. Instead it's time to do their job. We have sell signals on wheat, sell signals on soybeans today, they are two days old, they normally last four to six days. We think we'll have a sell signal on corn either Monday or Tuesday. So, we think it's time for producers to get the job done and while they are getting grain sales made, not only do they sell the grain that's in the bin, they sell also the bushels that are currently in the field and they also sell some bushels for 2011 and 2012. We have $4.15 corn today at one point for 2011 December delivery. We had $4.25 for 2012. So, we're seeing price levels out there that make very good sense and producers need to make sure they don't miss it.
Pearson: All right. So, this is an opportunity to make sales and not hold back. You mentioned old crop. You mentioned both corn and soybeans. There seems to be a lot of holding of soybeans. You mentioned South America but also here in the U.S. people were pretty aggressive sellers earlier and we have decent cash values now so it's even more reason maybe to take advantage of the soybean market today.
Roach: I think in reality most farmers have very few soybeans left. A lot of farmers took advantage of those higher prices last fall and said, what am I putting these in the bin for. They had a drought in South America, it's the end of their drought year, they are out, we're getting high bids, I'm talking last fall, the fall of 2009 and a lot of farmers sold their beans and a lot of farmers sold them right after the first of the year and then we had some other selling opportunities earlier in the spring. So, I think soybeans are in relatively tight hands, those that are left in this country, but I don't think it's very many. What is surprising is that South America with a monster crop has decided they want to hold the beans and so South American farmers have been really pretty tough on the market. When the market falls off they quit selling and they are holding a greater inventory now than what they normally do at this time of the year.
Pearson: You mentioned some of the bullish aspects to the corn market. You mentioned the potential issues in China. We had the disappointment about the renewable fuels mandate and the EPA being delayed. How big of a factor is that? Ethanol is chewing up a big percentage of our corn crop.
Roach: Well, in the last USDA report we saw ethanol usage, primarily ethanol usage increase the demand by as much as that negative report in January increased the supplies. That report caused prices to stumble pretty hard. If farmers remember when they gave us the final yield estimates in January they were big, about 250 million bushels bigger than we thought, killed the market. Well, on the last USDA report the estimate for the carryout a year from now, the fall of 2011 was cut by 250 million bushels primarily because of increased ethanol usage. So, it's a real big deal. And farmers need to, in this environment where we no longer feel comfortable drilling for oil in the Gulf of Mexico, in this environment we need to lobby hard for people to represent us in Washington who will mandate increased percentages of ethanol
Pearson: Well, certainly page one and leading off our segments today with the situation in the Gulf and that has to be a plus for ethanol I can say down the road. We'll see what happens with the EPA. As usual, John Roach, our senior market analyst joins us here this week on Market Plus. Thanks so much for being with us. Tell your friends and neighbors to join us here as well. For all of us here on Market to Market, I'm Mark Pearson. Have a great week.