As 2024 comes to a close, there is plenty to reflect on as it relates to the markets. Throughout the year we endured a fairly wet spring followed by phenomenal weather early in the growing season. Then things started to dry out toward the end of summer. Overall, most of the producers in my area were happy with the yields, but disappointed with prices. The old saying of “having your cake and eating it too” did not apply this year.

Although many were not pleased with the prices they received for their grain in 2024, I believe we can learn from how the market acted and try to be better in 2025.

Something I have been paying attention to is how the markets acted during this time last year (between Christmas and the New Year’s holiday).

For both corn and soybeans, the markets were relatively strong heading into the new year, then fell apart once the calendar flipped to 2024. Heading into 2024, soybeans lost over 43 cents from the close on Dec. 26 to the close on Jan. 2. Corn was much less dramatic, but still lost more than 10 cents in the same amount of time. Both contracts continued lower into the end of February before finding a bottom.

I point this out because I believe the rally we saw this year on the day following Christmas should be rewarded. March corn was able to close above its 200-day moving average for the first time since October of 2023. This is a positive sign for the markets and could be the spark we need to get out of this lull. However, I still believe that scaling into the rally is a much better option than sitting on your hands and doing nothing.

Related:Will soybean prices crash from a clash of fundamentals?

I encourage all my clients to be proactive in their marketing by using options to protect floors and cash sales. Some examples include:

Buy puts to protect the February crop insurance price. For those with crop insurance, prices will not be set until the month of February. Seeing how the market reacted last year, wouldn’t you want to put a floor under the prices we have now until you know what the insurance price will be? Buying a put option gives you that ability.

If the market trends lower, and insurance prices are below the current levels, you improve your guarantee with the put option.

On the other hand, if the market moves higher during February, your insurance price will be better. And, knowing your guarantee, you can get more aggressive with forward sales.

Buy calls to protect old crop sales. For those looking to make old crop sales, buy a call against your cash sales so if that market continues higher, you are still able to participate in the rally. And you will not suffer from FOMO (fear of missing out).

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These are just a few ways you can use options to improve your bottom line. I don’t want to continue being bearish. However, with the size of the Brazilian crop expected to be record large, and incoming tariffs on U.S. exported goods, it’s hard for me to get bullish.

With that in mind, let’s learn from what happened a year ago, and adjust our marketing plans where necessary.

If you would like help marketing your grain or want to discuss the ideas mentioned here, please give me a call at (309) 454-9270. You can also find us on our website at AgMarket.Net.

The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. AgMarket.Net is the Farm Division of John Stewart and Associates (JSA) based out of St Joe, MO and all futures and options trades are cleared through RJO’Brien in Chicago IL. This material has been prepared by an agent of JSA or a third party and is, or is in the nature of, a solicitation. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading information and advice is based on information taken from 3^rd party sources that are believed to be reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. The services provided by JSA may not be available in all jurisdictions. It is possible that the country in which you are a resident prohibits us from opening and maintaining an account for you.

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