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Should 2013 be a “Do-Nothing” Marketing Year?

April 6, 2013
By: Sara Schafer, Farm Journal Media Business and Crops Editor
Financial Glasses

Selling out of the field has paid off the last few years. "Last year, nobody sold anything, then we got a drought and the price of corn went up $3 in five or six weeks," says Jerry Gulke, president of the Gulke Group. "If anybody had cash contracting, they wish they hadn’t done that."

FarmJournalPulseA recent Farm Journal Pulse asked: How much of your 2013 corn production is sold or priced?

Here are the results:

2013 Corn Production sold or priced

  • None: 53%
  • 1-25%: 24%
  • 26-50%: 11%
  • 51-75%: 4%
  • 76-99%: 3%
  • 100%: 4%

(1,600 respondents -- see the results on an interactive map)

We asked the same question at this time last year. Here are those results:

2012 Corn Production sold or priced

  • None: 45%
  • 1-25%: 30%
  • 26-50%: 14%
  • 51-75%: 7%
  • 76-99%: 2%
  • 100%: 2%

(1,400 respondents -- see the 2012 results on an interactive map)

"In all honesty, farmers have been right to not forward sell much of their crop," Gulke says. "If you don’t want to learn futures and options, you do nothing. And the last couple of years, the best thing to do was ignore everybody’s advice and sell out of the field."

But, this year is already different from 2012.

"Last year we had to take prices higher to curb demand," Gulke says. "And, this year we’re going into a crop where we’ve already terribly curbed demand. Exports are less than half. Feed usage is down. Ethanol is down. You’re starting out with a low expectation of demand."

He says that if a reasonably sized crop is produced this year, we will have an oversupply.

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