Mother Nature has plenty of time to send a variety of weather conditions our way between now and fall. Still, we face what’s likely to be a harvest of wet, low-test-weight corn in many parts of the country. Along with that difficulty, how to best market this crop is weighing on many farmers’ minds.
Arlan Suderman, chief commodities economist for INTL FCStone, and Bob Utterback, president of Utterback Marketing, shared some of their concerns and recommendations with me. Here are brief excerpts from those conversations.
1. Consider Selling Corn as the Combine Rolls.
Farmers abhor selling corn at harvest, Utterback acknowledges. “But getting rid of 2019 corn sooner than later would be prudent — don’t hold onto it until next summer,” he says. This year, that could be a real mistake.”
Utterback anticipates some of the best price opportunities will occur in November and December, especially in the Central and Eastern Corn Belts where the basis will be strong. He contends we could be moving into a period of weaker prices where inflation will start pushing the cost curve out and causing margins to shrink.
2. If You Store Your Crop, Be Ready for Market Rallies.
“If this corn crop proves to be smaller than what the market's currently trading, which is what my view is, then there could be significant upside potential,” Suderman notes.
If you market your own grain but aren’t sure how to manage risk exposure, touch base with your local grain elevator. Most offer some over-the-counter tools that can help you lock-in a minimum price while leaving some upside potential.
Suderman also offers this bit of sage advice. “Don’t try to get the top of the market,” he says. “Remember, only one person gets the top.”
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