All commodities as a group trade in a three year cycles. We are past that mark now since our last 3 year cycle bottomed in June of 2012. Led by oil which is strongly influenced by the dollar, commodities have yet found their bottom, but they are near that mark now. You may also note that the level is stretched well below the 200 day moving average (green line). The point is, farmers need to exercise extreme patience when prices are at this level. The end of 3 year cycles are a blood bath phase, and can feel like there is no end to it. Now is not the time to be selling.
Like I had mentioned, commodities are led by oil. Oil looks to me to be in what is called a left translated cycle, which means it will probably test the summer lows. The shaded area on the chart below shows the timing band for the cycle. This is where I expect this blood bath phase of the commodity complex to end.
The strength of the dollar has really been the story with commodities. The dollar should stay strong until we get some sort of strong drop in the stock market to trigger money printing by the Fed. If stocks top after the Thanksgiving season or into Christmas, I think we will see a strong correction with the dollar which will be the catalyst for commodities to move out of their three year cycle low. From the chart below, you can see already that the price is near its spring high. I doubt it will be so easy to blow through this level on its first try without triggering some sort of correction.
Looking specifically at the corn chart, it looks to me to already be finding a bottom. This is not to say it could not go lower, but based on several factors, I find selling corn here to be a move which would have the odds stacked against you.
In the chart below, the CCI indicator shown in the small graph below the corn price chart is sending out a buy signal and prices are stretched way below the 200 day average. Prices could bounce around at this level for a few more weeks as oil moves lower, but I doubt we see corn push far below the trading range it has been in this month. In fact, this is probably an opportunity to sell some basis for your 2015 crop. When prices do rally, I would expect the basis to erode from these levels.
As of this morning, soybeans are breaking out to new lows. Barring a late day rally, it looks to me as though they would like to make one more move lower. Again, the price is at an extreme level below the 200 day moving average. Selling cash beans is not advisable. Take the opportunity to lock up basis at these levels.
Milk Futures have suffered all year. Again, as the dollar corrects, I think we will see a strong rally for milk. I would not be making any moves to lock in milk prices at these levels.