Corn was exprected to dip down to $4.00 this fall way back last January.... At that time corn was in the $5-6 range.
With the drought it is hovering at the $8.00 price right now.
Most feed companies buy/order/cpntract their corn ahead of time, at prices that appear to be a good buy at the time. They try to hit good bargins as best they can....
I fear many feed companies were waiting for the 'low prices' we all were expecting this fall, and did not buy much $5-6 corn ahead of time.
Now they are being hit with $8 corn prices, and fears it may go a bit higher.
If any of your feed stores bought a lot ahead at $5, they will either be able to sell you cheaper feed; or they will be selling at the same price as the feed stores that haven't bought anything ahead of time and will be making money hand over fist this fall!
The drought isn't making a terrible shortage of feed, but it has really, really messed up typical buying patterns and price patterns of buy low at harvest, sell high in mid spring. It has really messed up some feed stores that guessed wrong.
As a farmer, I sold some corn last winter for $5, it is yet to be harvested. But it's already sold. Looking back, that sure was a mistake. But, I only sold 10% that way. I have some more I sold for $7.75 a little while ago - again I have yet to harvest that corn, but it is already 'sold'. I'm waiting to see if we go higher, or drop down a bit - I think we may drop down a little bit, but should stay over $7 anyhow.
All together, I should average a pretty good price for my corn, even with the $5 contract thrown in there. With the record amount of corn planted this spring, that looked like a good price at the time, corn coulda falled a lot lower from there....
So, whomever bought that $5 corn from me is sitting good now. Hopefully it was your feed store, and thay are passing the savings on to you.
--->Paul