Ask an Analyst: Taylor Pope

January 10, 2018 04:03 PM
 
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What is your commodity marketing philosophy?

Our primary goal is to limit producers’ risk and preserve their potential. It’s important to know you’re profitable and to preserve the upside from there.

What distinguishes your firm from others?

Taylor Pope

We’re a dedicated group with a heavy merchandising and trading background. We help producers market corn, wheat and soybeans, as well as some rice, cotton and livestock.

What really separates us is our effort to make it an individualized partnership. We make every marketing plan specific to each grower, and we also know their merchandizing story, their local elevators and basis, and build a plan around it.

What’s one action every producer should take to manage commodity marketing risk?

Don’t be afraid to pull the trigger when you are at profitable levels. Growers are always hesitant to overcommit early on. Look at your worst yields in the last 10 to 15 years and protect those levels when it is profitable to do so before harvest. If you are nervous about production, use the board to hedge. As you go forward into January, know that the carry is there and use that to your advantage. This is especially true if you have the capability to store grain on your farm operation.

What percentage sold should farmers be on their crops?

We try very hard not to have a cookie-cutter approach. Every producer is different: storage, debt, cash needs, etc. As of December, we’re 80% sold in soybeans, 60% sold in corn. We’ve got some sales on for next year.

Which marketing tool is most underappreciated?

Time—and using it to your advantage with short options and basis. Options make time your ally rather than your enemy. You can capture basis if you have storage capabilities. There can be such drastic price swings in this business, but timing basis is an often overlooked component to good marketing.

Who is one expert in our industry whose business advice you respect greatly?

I grew up in Champaign, Ill., so I follow Darrel Good and Scott Irwin and value their opinions. I went to Purdue University and have gotten to know and respect David Widmar. In terms of the business of commodity marketing, I respect my dad.

It’s a real treat to learn from him every day.

What activities do you enjoy outside of work?

Whatever I like to do is about to change because my wife and I have twins due in the spring. Until then, I like hiking and golf and am a college basketball fanatic.

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