What prices do we want?

Jun 04, 2021


By: Zack Gardner, Grain Marketing and Origination Specialist
 
This past month there’s been an exceptional amount of volatility in the market. In just the past week, we have seen three limit moves ($.40) on corn. On May 25th, we were limit lower on corn and just two days later, we were limit higher. This tells me that the market doesn’t necessarily know what it wants to do, but whenever it decides, it will go that direction in a hurry.

There are both bullish and bearish scenarios out there that could play out. To me, this screams offers. If you have a price target in mind, utilize the market volatility with these wild swings and have offers out there ready to capture your price targets. If you are on the fence about forward marketing, two things to keep in mind are that we have revenue insurance that covers our forward sales and that we are closer to our highs from back in 2012 than we are to our lows from just a year ago.
 
Potentially bullish news:
  • China could take delivery on the majority of their corn purchases (shipments have been strong so far)
  • We are dry and this past months rains haven’t fully replenished subsoil moisture for most producers
  • How is your stand looking? If we don’t get weekly rains from here on out is there a chance that we don’t hit the USDA’s trend line yield?
  • We might not see the increase in corn/bean acres that some are predicting on the June 30th report
 
Potentially bearish scenarios:
  • China could cancel or roll a substantial portion of their 702 million unshipped old crop corn purchases
  • Soybean exports are behind pace and could be added back into our carryout (there is ~150 million bushels of unshipped soybean export sales, which could double our carryout)
  • We might not run out of old crop grain (basis is currently weakening and we currently have a 1.3 billion bushel corn surplus right now)
  • Politics with Russia or China might hurt our long term grain demand from China
  • The USDA could find a whole bunch of acres this month for the June 30th report

Read More News

Nov 21,2022
It's hard to believe we're nearing the end of another crop year. Looking back on the 2022 season, we recall how we were met with challenges and obstacles. A cool, damp spring led to some delays in planting. Those conditions were followed by an abnormally dry summer.
Nov 14,2022
Bushels for Ag rewards FFA chapters with the gift of grain. 
Nov 07,2022
Winter is upon us! That means it's time to start thinking about implementing changes that will ensure our livestock have the proper nutrition to fuel both them and the production of their offspring when the temperature drops.