Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Mr. Stephen Byrne of Merrill Lynch. Please proceed.
Stephen Byrne - Merrill Lynch
Can you comment on what the pipeline of acquisition opportunities looks like for you right now, and more specifically if the owners of Agriliance were to choose to sell to a non-co-op, would you be interested?
L. Kenneth Cordell
Steve, I’d like to stick with the fact that we said in the release, that we expect to buy at least $300 million worth of acquisitions in the third or fourth quarter.
Yes, we would be interested in Agriliance and have stated that we would be early on, if the owners decide to sell to someone else. But it is our understanding that that deal is going to be completed.
Stephen Byrne - Merrill Lynch
Kenny, given where the new crop wheat prices are, what do you think winter wheat plantings are likely to be this fall? And are you expecting a higher application rate of fertilize on that crop?
L. Kenneth Cordell
We think that there will be a lot more wheat planning in the high plains, from Texas up through the Dakotas. And a lot of that is in wheat. We’ve had a lot of rainfall and have got a good moisture conditions, so we expect wheat acreage and fertilizer applications to be up in that area. But it remains to be seen how much of that will happen in the fall versus the spring and the weather conditions are all that will drive that.
Beyond that, it’s hard to tell. I mean, you’ve got $9 soybeans, corn price creeping back up, cotton price creeping back up. I mean, as I said last year, there’s a lot that’s going to happen between now and the spring and it’s just about impossible to predict acreage.
The Brazil crop is going to have a big bearing on the soybean price, as well as demand for corn offshore. From our standpoint, we don’t anticipate any volatility in crop plantings like we saw last year. I mean, a 14 million acre increase in corn at the expense of cotton and soybeans, that is a dramatic shift in acres that our entire industry had to deal with.
We don’t expect anything like that this year. There could be shifts of 2 million to 3 million acres between crops but that is normal. We’ve seen that over the last decade. It’s much more easy to plan for, much more easy to execute into.
- To read the full transcript on Seeking Alpha, click here »
