Markets will continue to trade even though planters are rolling. As I visit with many farmers and hear their frustrations in marketing over the years, the number one reason why some are not satisfied with their own marketing is “I didn’t have time to do it!”
Seems a little silly, but it is true. It is human nature to focus on the projects and activities we enjoy. Marketing does not seem to be one of those activities because it is hard to do something and discover within a few moments that your decision might have been wrong.
Even this week, the market was unforgiving to those who didn’t take time to complete the marketing task they wanted accomplished. They had goals and knew they wanted a product sold if it got to a certain price – yet, instead of leaving an offer, they said they would “watch it.”
That is lack of commitment.
How to market while you are busy
With all of that in mind, following are a few tips to help you market while you are busy because what turns out to be “I didn’t have time” is really more “I don’t want to commit to a price in case it goes higher!”
- Write down your marketing plan. This should include old crop and how soon you need to move it.
- If you know you will need to be moving old crop bushels out of the bin in the next 45 days, have a reasonable offer working in case there is a run up in the market while you are not looking
(example- Bean market gave a good effort on recovery Thursday, but if you weren’t watching and didn’t have an offer working, the price was fleeting).
- Leave a hard offer working with the elevator. Don’t ask them to call you “if it gets close.” Unfortunately they are also busy multi-tasking this time of the year as well. The market moves so fast, sometimes it is not possible to let you know in time and sometimes the price hits in the overnight trading session.
- Make sure you are reviewing your new crop offers. May is approaching fast and you may need to make adjustments to offers to get to another level of new crop sales or protection.
- Check local basis levels for fall delivery regularly. In some markets there are opportunities on fall delivered values that are better than historical values. If you won’t have enough storage, consider at least getting basis locked in on some bushels for out-of-the field delivery.
- With a trend line yield and a reduction in use on corn, storage may cost higher than normal given certain market conditions. Consider a basis contract for fall delivery on bushels you will be short on farm storage.
Bottom line? Now is not a time to ignore marketing. Volatility will likely continue. This is fully a time to embrace that volatility and be prepared for those fleeting marketing opportunities by having a plan and implementing it.
It is easier to defend a cash sale with a call option than to wish you had the sale in place and watch the market move lower wondering what to do. Make marketing a priority this spring by setting yourself up to succeed! Safe and successful planting, All!