Illinois grower/grain market analyst Jason Moss is always looking for marketing opportunities. He strives to make early marketing decisions based on early USDA and foreign-crop reports. Unlike recent years, where 25¢ price shifts were the normal, he pays more attention to 5¢ market moves, knowing that profit margins will likely be tighter than ever.
“In August 2012, I used December 2014 corn futures to market about 20% of my ’14 crop. I marketed another 20% in May of 2013. The contracts are at $5.80-$6.10," says Jason Moss, west-central Illinois farmer.
Considering where corn was not that long ago, Jason Moss frowns at prices on the futures market and at his local elevator. And he’s thankful he got about 40% of his expected crop booked early at near $5.50 per bushel when demand was still high, supply was low and markets were hot.
Moss, a Quincy, Ill., grower/grain market analyst, is among few who are very excited about corn or soybean prices in early 2014. Gone are $7 corn and $15 beans. Taking time to revisit pricing programs offered by your local elevator, ethanol plant or other grain user may yield a positive return.
“If you can get some priced, you might want to take advantage of the market,” says Perry Broders, a grain merchandiser for AGP in Lincoln, Neb. “With the large corn carryover, if we have any sign of decent crop, there will definitely be pressure on the cash price.”
Kyle Lehman, grain merchandiser for Farmers Cooperative Co. in Ames, Iowa, adds that farmers will likely look closer at marketing tools available from grain handling co-ops and private companies. “We offer various types of contracts on our website and at regional offices,” he says. “We give farmers a market rundown and list marketing possibilities they may consider, such at hedge-to-arrive, basis, minimum price or other contracts they may consider.”
Moss is looking at potential marketing opportunities for his 2,000 acres of corn in west-central Illinois. He was 100% corn in 2013 and plans on continuous corn again this year. “I’m 40% sold already,” he says, adding that he figured pricing at near $6 would generate a solid profit, even if price one-two years ahead.
“In August 2012, I used December 2014 corn futures to market about 20% of my ’14 crop. I marketed another 20% in May of 2013. The contracts are at $5.80-$6.10.”
He admits that profit from the remaining portion of his unsold crop won’t be as easy. “In the past two years we’ve debated on 25¢ moves in the market,” he says. “Now we fighting for nickel moves.”
Moss’ second role is that of a market analyst for Brock Associates. He often offers farmers the same advice he uses to make sales. And with about 60% of his anticipated crop still unsold, he is looking for upward price shifts to market more.
“Based on cost of production numbers, selling corn anywhere in the upper half of the $4s should be profitable with an average yield,” he says. “We can’t just wait on $5 corn again.