Investment ideas 2.0
On my travels to Mato Grosso and throughout Brazil, I am always looking for who the new
leaders in Ag and Ag business will be.
I am speaking of the 2nd generation Mato Grosso pioneers that want to stay and follow
in their fathers footsteps. The age of these new pioneers are 18 to 30 years old.
There are a handful of brilliant, passionate, globally educated males and females
that are back running the family business and looking for a way to take their ideas
to the next level- to go international.
I have found a handful that speak perfect English, traveled the world, and are what
I call dynamic business-minded people ready to take their family business to next level.
People like this are literally 1 in a million. The thing many foreigners do not grasp is that
well to do families send their kids abroad to then come back home and help the family
business grow.These young people are not looking for a job per sey. They are looking for
opportunities to put their knowledge, know how, and who they know to work.
In USA, for example, a well to do family will send their son or daughter off to a well known
college and then encourage them join a company or start their own business before they are
incorporated in the family business. We in the USA tend to learn how to fail. Learn how a business
is run and work with people.
In Brazil, a wealthy family tends to look at getting a job either during or after college as
demeaning to the family image. The family business has more than enough to go around.
Thus, we see a different dynamic unfold.
I have been approached by young dynamic Brazilian male and females to form partnerships
with foreign investors. This is a broad range of interests.
These range from:
A Brazilian partner to help buy land
Non- GMO seed sales rice and soy
Cattle feedlots
ethanol mills/value added processing
Tourism locals hotels and R&R locals/ environmental tourism
Transport and grain storage facilities and monitoring systems
There are many other possibilities ranging from restaurant chains, American
bar and grill themes, to sky diving in Brazil.
For those interested in thinking outside the box be it Brazilian or Gringo,
please drop me a note and we can chat about this and I can offer some
feedback as to what does and does not work in Brazil.
agturbobrazil@yahoo.com
We are in a phase now where dollars are leaving Brazil and Brazil has a
scarlet letter on her flag at the moment. This will pass.
I think we are within a year of Brazil recovering and regaining some growth again.
The point is that one needs boots on the ground and due diligence needs to be
done prior to the next wave starting. One needs to be ready.
There are a handful of very dynamic "20 somethings" that are itching to do
what their fathers have done again. But this time it will be Ag 2.0 and 3.0
Internet, robots, drones,What´s App, processing, value added, etc that will turbo
charge the next decade. When I first came in 2001, one was lucky to have
a cell phone much less a signal !!!!
The next phase is not linear growth, it is exponential.
Kory
Saturday, November 22, 2014
Wednesday, November 19, 2014
Brazil corn ethanol, soy germination, lower crop sizes
https://www.youtube.com/watch?v=64L7Tew6dlQ&feature=youtu.be
I am back at headquarters after a 10 day loop in Mato Grosso.
I have never seen such extremes in the soybean crop at this time of year.
One side of the road was just planted and the other side was 40 days old.
We will see average yields and also some great yields this season.
Two major concerns by producers this season. Below optimum germination and also
short soybeans. The bottom pods will likely be lying on the ground. It makes harvest difficult and
slow. With the 3-4 week delay in planting, many of the soybean totes were stored in sheds with
no ventilation. The temps inside these sheds rose to 120 deg F at times. Many producers blame
light stands on a drop in germination vigor because of this.
Abiove has lowered their crop size estimate for Brazil. I think IMEA will be next to drop
the size of the Mato Grosso crop. I think we are looking at a crop size the same as last year.
Talk of planting marginal land back in to pasture is picking up. Cattle are gold on 4 legs.
Soybeans are not gold at the moment. Back in the black yes, but not gold.
Above is a you tube video of the beginning phase of the Fiagril/USA joint venture
corn ethanol mill in Lucas do Rio Verde.
Clients and subscribers have been updated on almost a daily basis while I have been on
tour. Newsletters and VIP consult retainers are available on my site via Pay Pal or USA
bank wire upon request.
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
http://www.brazilintl.com/states/matogrosso/korymelby/kory-cs/km-cs.htm
Retainers and subscriptions will go up in 2015. 7-10% to compensate for inflation.
For anyone interested, I will hold the 2014 price for you for a few more weeks.
New subscribers only
Many tours being planned for early 2015. Crop tours, Ag biz and 2nd crop
corn will be high on the interest list. Limited space available.
Drop me a note for more info.
Rains for the most part are normalizing. Next 5 days look wet.
However, the last 5 days in Goiania were supposed to be wet, and
we have not received a drop.
Regards,
Kory
I am back at headquarters after a 10 day loop in Mato Grosso.
I have never seen such extremes in the soybean crop at this time of year.
One side of the road was just planted and the other side was 40 days old.
Two major concerns by producers this season. Below optimum germination and also
short soybeans. The bottom pods will likely be lying on the ground. It makes harvest difficult and
slow. With the 3-4 week delay in planting, many of the soybean totes were stored in sheds with
no ventilation. The temps inside these sheds rose to 120 deg F at times. Many producers blame
light stands on a drop in germination vigor because of this.
Abiove has lowered their crop size estimate for Brazil. I think IMEA will be next to drop
the size of the Mato Grosso crop. I think we are looking at a crop size the same as last year.
Talk of planting marginal land back in to pasture is picking up. Cattle are gold on 4 legs.
Soybeans are not gold at the moment. Back in the black yes, but not gold.
Above is a you tube video of the beginning phase of the Fiagril/USA joint venture
corn ethanol mill in Lucas do Rio Verde.
Clients and subscribers have been updated on almost a daily basis while I have been on
tour. Newsletters and VIP consult retainers are available on my site via Pay Pal or USA
bank wire upon request.
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
http://www.brazilintl.com/states/matogrosso/korymelby/kory-cs/km-cs.htm
Retainers and subscriptions will go up in 2015. 7-10% to compensate for inflation.
For anyone interested, I will hold the 2014 price for you for a few more weeks.
New subscribers only
Many tours being planned for early 2015. Crop tours, Ag biz and 2nd crop
corn will be high on the interest list. Limited space available.
Drop me a note for more info.
Rains for the most part are normalizing. Next 5 days look wet.
However, the last 5 days in Goiania were supposed to be wet, and
we have not received a drop.
Regards,
Kory
Wednesday, November 5, 2014
2015 crop tours
I am headed to Mato Grosso Friday for 9 days.
I will be doing my own crop tour and updating clients
in my November newsletter due out Nov 17th time frame.
For those of you that have contacted me regarding a 2015
soybean harvest and corn planting tour, time is of the essence.
Harvest will be a bit later than normal this year.
The full push harvest will not get going until the end of January.
February will be complete chaos. Rains, harvest, drying, planting,
and lack of storage. Truck lines as far as you can see.
Carnival is Feb 13-17th. Arriving during this time can be
time consuming and costly. It is best to arrive well before or
after Carnival.
Early and late February will be the optimal times to get a real time
grasp of yields and planting potentials for 2nd crop corn.
Late planted corn combined with no rain in April 2015 would mean
a wipe out for the 2nd crop. There is no more "cushion" left for this
years crop cycle. Things must unfold normally from here on out to maintain
par.
What a difference a month makes. I told clients in September I would
remain conservative as to Brazil´s soybean crop potential. 93 million tons
has been my number.
Most everyone else was higher. Now with recent adjustments made by some,
I am now the optimistic one. For now I stand pat on my number until I see
differently.
With all the soybeans in the world, a 10 million ton drop does not really matter to
the markets. A 20 million ton drop would stop the decline and trade sideways
with an upward bias. It still would not be a bull market.
We are in a bear until events prove it otherwise.
Flash updates will be sent out to subscribers while I am on tour.
Drop me a note at agturbobrazil@yahoo.com for more info.
Kory
I will be doing my own crop tour and updating clients
in my November newsletter due out Nov 17th time frame.
For those of you that have contacted me regarding a 2015
soybean harvest and corn planting tour, time is of the essence.
Harvest will be a bit later than normal this year.
The full push harvest will not get going until the end of January.
February will be complete chaos. Rains, harvest, drying, planting,
and lack of storage. Truck lines as far as you can see.
Carnival is Feb 13-17th. Arriving during this time can be
time consuming and costly. It is best to arrive well before or
after Carnival.
Early and late February will be the optimal times to get a real time
grasp of yields and planting potentials for 2nd crop corn.
Late planted corn combined with no rain in April 2015 would mean
a wipe out for the 2nd crop. There is no more "cushion" left for this
years crop cycle. Things must unfold normally from here on out to maintain
par.
What a difference a month makes. I told clients in September I would
remain conservative as to Brazil´s soybean crop potential. 93 million tons
has been my number.
Most everyone else was higher. Now with recent adjustments made by some,
I am now the optimistic one. For now I stand pat on my number until I see
differently.
With all the soybeans in the world, a 10 million ton drop does not really matter to
the markets. A 20 million ton drop would stop the decline and trade sideways
with an upward bias. It still would not be a bull market.
We are in a bear until events prove it otherwise.
Flash updates will be sent out to subscribers while I am on tour.
Drop me a note at agturbobrazil@yahoo.com for more info.
Kory
Saturday, November 1, 2014
Rain, bugs, rust, crop size
Nov 1
It is November and only 40% of the soybeans are planted in Mato Grosso vs
75% normally.
We have been getting some rains. But rains are light. In recent years, rains
tend to set in and last all day by this time of year. It is fine for now, but sure
is weird. If rains would be like this in early January when crop needs lots of
water per day, we have a problem.
Vegetative index year over year shows an expansion of the drought.
The soybean crop size of 95 to 98 mmt is now gone.
Those who forecast a mega crop will soon be dropping their numbers.
The range is now 89-94 mmt. I am in this camp.
The crop will be planted in the next two weeks.
Insects and caterpillars are already being sprayed for 20 days after
planting.
The key to the 2015 soybean and corn crops now hinge on the harvest
window from Feb 20th through March 15th. The weather at this time will
determine everything.
If a wet weather scenario would set in during February, very little 2nd crop
corn will be planted. If it is planted, it will be for cover crop purposes and
not for harvest.
Some have said a 40% drop in Mato Grosso 2nd crop corn is possible.
I am not there yet.
The likely scenario will be a 20% drop in planted area and if the rains
shut off in April, another 20% whack to the yield. It might feel like
a 40% drop in a perfect storm.
Asian rust is showing up on re-growth soybeans. This drives agronomists
batty to see this so early. We know we need to spray 3 times.
There will be pressure on these soybeans from a very early stage.
Keep in mind the longest day of the year is Dec. 21. That is only
50 days away. Soybean growers know what this can mean.
This is a whacky year. Some say the Amazon is malfunctioning??
Maybe needs a new pump?
The pioneers of Mato Grosso have not experienced this in their young
history of 20 to 30 years from Cerrado/Forest to farmland.
It would not surprise me if we are talking about flooding by February.
Roads and bridges washed out and moldy soybeans.
The rally in Chicago and the Dollar/Real have been a godsend for many.
1.25 CME + 1 dollar forex feels like US$ 2.25/bu rally in Oct for many.
This gets many guys back in the black if we can produce an average yield.
This also means more expensive fertilizer and chemicals for 2016.
It is a catch 22. What saves you in the short run castrates you in the
longer term.
Brazil raised her interest rates to 11.25% this week. Some say 12% is next.
Here is another paradox. Brazil needs to stimulate growth with budget
deficit spending and yet slam the brakes on inflation at the same time.
In 2009/2010 Brazil lucked out with the Ben Bernanke helicopter of dollars
looking for a home or aka carry trade. Brazil had free money coming in.
No more free money. What will they do????
I will keep subscribers in the loop as I travel in Mato Grosso next week.
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
It is November and only 40% of the soybeans are planted in Mato Grosso vs
75% normally.
We have been getting some rains. But rains are light. In recent years, rains
tend to set in and last all day by this time of year. It is fine for now, but sure
is weird. If rains would be like this in early January when crop needs lots of
water per day, we have a problem.
Vegetative index year over year shows an expansion of the drought.
The soybean crop size of 95 to 98 mmt is now gone.
Those who forecast a mega crop will soon be dropping their numbers.
The range is now 89-94 mmt. I am in this camp.
The crop will be planted in the next two weeks.
Insects and caterpillars are already being sprayed for 20 days after
planting.
The key to the 2015 soybean and corn crops now hinge on the harvest
window from Feb 20th through March 15th. The weather at this time will
determine everything.
If a wet weather scenario would set in during February, very little 2nd crop
corn will be planted. If it is planted, it will be for cover crop purposes and
not for harvest.
Some have said a 40% drop in Mato Grosso 2nd crop corn is possible.
I am not there yet.
The likely scenario will be a 20% drop in planted area and if the rains
shut off in April, another 20% whack to the yield. It might feel like
a 40% drop in a perfect storm.
Asian rust is showing up on re-growth soybeans. This drives agronomists
batty to see this so early. We know we need to spray 3 times.
There will be pressure on these soybeans from a very early stage.
Keep in mind the longest day of the year is Dec. 21. That is only
50 days away. Soybean growers know what this can mean.
This is a whacky year. Some say the Amazon is malfunctioning??
Maybe needs a new pump?
The pioneers of Mato Grosso have not experienced this in their young
history of 20 to 30 years from Cerrado/Forest to farmland.
It would not surprise me if we are talking about flooding by February.
Roads and bridges washed out and moldy soybeans.
The rally in Chicago and the Dollar/Real have been a godsend for many.
1.25 CME + 1 dollar forex feels like US$ 2.25/bu rally in Oct for many.
This gets many guys back in the black if we can produce an average yield.
This also means more expensive fertilizer and chemicals for 2016.
It is a catch 22. What saves you in the short run castrates you in the
longer term.
Brazil raised her interest rates to 11.25% this week. Some say 12% is next.
Here is another paradox. Brazil needs to stimulate growth with budget
deficit spending and yet slam the brakes on inflation at the same time.
In 2009/2010 Brazil lucked out with the Ben Bernanke helicopter of dollars
looking for a home or aka carry trade. Brazil had free money coming in.
No more free money. What will they do????
I will keep subscribers in the loop as I travel in Mato Grosso next week.
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
Monday, October 27, 2014
Moving forward
I must say that I had a good belly laugh when I saw this image today.
No much to say about election. I am speechless.
One person summed it up well last night. Brazil gets the government she deserves.
The Real will be weak which will help save the Brazilian soybean farmer in early 2015.
Planting progress will now kick into high gear. I hear about problems in Parana and Mato Grosso.
There are always some.
I will be in Mato Grosso in November.
As the Dollar/Real ratio widens, there will be opportunities for foreign
investors that are quick on their feet.
We have seen this before. We need to go through some convulsions but Brazil
will be Brazil. Protests, strikes, corruption, steal a little here and there, kick back to
a few friends and before you know it we will have a new railroad. It is all about
positioning and now we have the correct people in place to get that done. The previous
four years was prep for the next four years. It has taken me a long time to get that
into my Gringo skull. It was kinda thick, now, it is more pliable.
It is hard for a Northern Hemisphere person to grasp what goes on in the minds
of a Latin American country citizen. What one populous would impeach a President for, a
Latin American country may very well re-elect. One needs to live here to understand it.
And even then, it can stare you right in the face and you will miss it.
No much to say about election. I am speechless.
One person summed it up well last night. Brazil gets the government she deserves.
The Real will be weak which will help save the Brazilian soybean farmer in early 2015.
Planting progress will now kick into high gear. I hear about problems in Parana and Mato Grosso.
There are always some.
I will be in Mato Grosso in November.
As the Dollar/Real ratio widens, there will be opportunities for foreign
investors that are quick on their feet.
We have seen this before. We need to go through some convulsions but Brazil
will be Brazil. Protests, strikes, corruption, steal a little here and there, kick back to
a few friends and before you know it we will have a new railroad. It is all about
positioning and now we have the correct people in place to get that done. The previous
four years was prep for the next four years. It has taken me a long time to get that
into my Gringo skull. It was kinda thick, now, it is more pliable.
It is hard for a Northern Hemisphere person to grasp what goes on in the minds
of a Latin American country citizen. What one populous would impeach a President for, a
Latin American country may very well re-elect. One needs to live here to understand it.
And even then, it can stare you right in the face and you will miss it.
Friday, October 10, 2014
Hot and dry, 2nd round elections, and re-planting of soybeans on deck
What a week.
Brazil had its first round elections. The pro-business candidate Aecio Neves came from
a distant 3rd place to formidable 2nd place competitor.
It has the current power structure on high alert.
At this time, it is a 50/50 toss up who will win.
It reminds me of the George Bush II and Al Gore election.
A few votes will likely determine this one too.
The weather has gone bonkers here too. Normally the dry season
ends by now and we have daily rains.
It is normal for the Eastern states to remain dry a bit longer.
Planting soy in November as a single crop is the norm.
But Mato Grosso, what a shocker. Pop corn fart dry this week.
The forecast is for another 6 to 10 days dry then some rains.
Friends of mine have 3200 ha of soybeans planted of 14,000.
They have stopped planting waiting for more rains.
They are watching the development of recently planted soy.
They are worried that re-planting will be necessary.
Do it again !!!!!
Some say two more days dry, re-plant.
This is really screwing up the plans of producers that plan on
an early soy harvest in January and plant cotton and corn behind.
With the main soy areas being planted circa November in Mato Grosso,
it makes a 2nd crop almost impossible or at the very least very very high risk.
I have not seen this weather scenario manifest in the 13 years I have been
watching Mato Grosso. This one is different. We have seen dry spells,
but nothing quite like this one.
We are off to an erratic start. Too wet down South. Wheat scab hurting the
crops in Parana and RGDS. Too dry in North and way too hot.
Up to 120 deg F at times.
I will monitor the situation.
Subscribers and VIP clients are the first to know.
Brazil had its first round elections. The pro-business candidate Aecio Neves came from
a distant 3rd place to formidable 2nd place competitor.
It has the current power structure on high alert.
At this time, it is a 50/50 toss up who will win.
It reminds me of the George Bush II and Al Gore election.
A few votes will likely determine this one too.
The weather has gone bonkers here too. Normally the dry season
ends by now and we have daily rains.
It is normal for the Eastern states to remain dry a bit longer.
Planting soy in November as a single crop is the norm.
But Mato Grosso, what a shocker. Pop corn fart dry this week.
The forecast is for another 6 to 10 days dry then some rains.
Friends of mine have 3200 ha of soybeans planted of 14,000.
They have stopped planting waiting for more rains.
They are watching the development of recently planted soy.
They are worried that re-planting will be necessary.
Do it again !!!!!
Some say two more days dry, re-plant.
This is really screwing up the plans of producers that plan on
an early soy harvest in January and plant cotton and corn behind.
With the main soy areas being planted circa November in Mato Grosso,
it makes a 2nd crop almost impossible or at the very least very very high risk.
I have not seen this weather scenario manifest in the 13 years I have been
watching Mato Grosso. This one is different. We have seen dry spells,
but nothing quite like this one.
We are off to an erratic start. Too wet down South. Wheat scab hurting the
crops in Parana and RGDS. Too dry in North and way too hot.
Up to 120 deg F at times.
I will monitor the situation.
Subscribers and VIP clients are the first to know.
Saturday, October 4, 2014
Dollar, elections, weather
Sunday is the big day. Elections
The latest polls show President Dilma winning in a runoff on Oct 26th.
When I see the amount of contra Dilma propaganda on Facebook, on car bumper
stickers, and comments from friends, I wonder who is voting for her? No one
admits they will and yet she is the leader?
The lower classes and population centers must love her? Keep things the same.
It made me chuckle this week when she was asked about corruption again.
Her response, " I believe that there is corruption in all parts of the world".
I guess that makes it OK??? Normal operating procedure.
The dollar rallied to 2.52 Friday before selling off to 2.46 on the close.
The last three weeks a lot of volatility.
From my perspective 2.50:1 is about right. It is the max exchange rate
that investors and markets allow a country to have and yet remain viable.
We start talking 3:1, everyone knows you eat Bananas for breakfast.
Or at the very least, you are coo-coo for cocoa puffs.
Weather has been erratic. Heavy rains in Southern Brazil. Foz do Iguacu
is running at full force.
http://www.gazetadopovo.com.br/vidaecidadania/chuvas/conteudo.phtml?tl=1&id=1502896&tit=Vazao-das-Cataratas-alcanca-nivel-seis-vezes-maior-do-que-a-media
The Northeast is running behind. And the forecast that it is to remain below normal rainfall
for the next couple weeks. Coffee, Cane, and water reservoirs are of concern.
I will update clients Sunday night or Monday morning as per election results.
Conab will be out Thursday Oct 9th with their first 2015 crop size forecast.
I will send out special report.
Newsletter purchase link as at:
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
The latest polls show President Dilma winning in a runoff on Oct 26th.
When I see the amount of contra Dilma propaganda on Facebook, on car bumper
stickers, and comments from friends, I wonder who is voting for her? No one
admits they will and yet she is the leader?
The lower classes and population centers must love her? Keep things the same.
It made me chuckle this week when she was asked about corruption again.
Her response, " I believe that there is corruption in all parts of the world".
I guess that makes it OK??? Normal operating procedure.
The dollar rallied to 2.52 Friday before selling off to 2.46 on the close.
The last three weeks a lot of volatility.
From my perspective 2.50:1 is about right. It is the max exchange rate
that investors and markets allow a country to have and yet remain viable.
We start talking 3:1, everyone knows you eat Bananas for breakfast.
Or at the very least, you are coo-coo for cocoa puffs.
Weather has been erratic. Heavy rains in Southern Brazil. Foz do Iguacu
is running at full force.
http://www.gazetadopovo.com.br/vidaecidadania/chuvas/conteudo.phtml?tl=1&id=1502896&tit=Vazao-das-Cataratas-alcanca-nivel-seis-vezes-maior-do-que-a-media
The Northeast is running behind. And the forecast that it is to remain below normal rainfall
for the next couple weeks. Coffee, Cane, and water reservoirs are of concern.
I will update clients Sunday night or Monday morning as per election results.
Conab will be out Thursday Oct 9th with their first 2015 crop size forecast.
I will send out special report.
Newsletter purchase link as at:
http://www.brazilintl.com/states/matogrosso/korymelby/kory_newsletter/km_newletter.htm
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