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Thinking outside their regional market led Kansas farmers Brett and Clint Reiss to find a much stronger corn basis. And by contracting to make 1,000-bushel corn sales every week, they will obtain orderly pricing on up to 30% of their 2014 crop, while having a $4.50 floor.
Even though signs don’t point to a new-corn futures price of $5 or more per bushel, shifts in basis make it a reasonable target for southwest Kansas brothers Brett and Clint Reiss.
The Reisses farm with their father, Stan, on a fifth generation farm near Plains. They grow irrigated corn and soybeans and dryland wheat and milo. And they’ve already forward contracted about 50% of their corn, thanks to sound basis opportunities. But they’re still waiting on the chance to get beans sold.
“Our soybean basis is usually $1 per bushel under futures, so we need some price movement before making any bean sales,” says Clint.
Growers across the Corn Belt need to monitor price, weather and planted acres movements and wait for a signal to pull the trigger on sales, says Dan O’Brien, Kansas State University Extension economist.
“Seasonal questions and uncertainty about 2014 U.S. corn and soybean planted acres and production prospects during the coming April-May-early June period are likely to provide new-crop forward pricing opportunities,” O’Brien says.