How to Make Smart Soybean Price Rally Sales

March 28, 2016 12:00 PM
Soybeans Miss

In light of the recent rally in soybean prices, producers shouldn’t sit on their hands when prices rise above their breakeven, says Matt Bennett, Bennett Consulting. Instead, they should consider making sales at $9 and higher if it pencils out.

“We need to be very cautious as to getting too bullish once the rally that we were waiting on finally gets here,” Bennett tells “AgDay” host Tyne Morgan during a recent Agribusiness Update segment. “We’ve been telling guys, ‘If you’ve been waiting on $9 soybeans, don’t sit on your hands and do nothing, especially if you can break even or do better.’ Make your first incremental sale on the new crop, and probably move out a lot of the old-crop soybeans, too.”

It’s likely another rally is in the cards, but farmers need to be prepared to act quickly if it transpires.

“I definitely don’t want to be just banking on some sort of a weather issue,” Bennett cautions. “I want to know what my breakeven levels are. That way, I can pull the trigger when it’s time because like last summer, it might be a very short-lived rally. We need to be ready whenever it gets here.”

As for whether the recent price rally could shift some acres to additional soybeans, Bennett thinks it’s a possibility.

“On highly productive acres, it’s pretty tough to make the case for soybeans over corn,” he says. “But there are a lot of fringe areas over the U.S. that can still raise really good yields on soybeans. Bottom-line yields on soybeans in the last two years have been phenomenal for a lot of people. When you get to that psychological point of $9 and above, I think it definitely changes people’s mindsets.”

Click the play button below to watch the complete interview with Bennett on “AgDay.” 

Want more video news? Watch it on AgDay.
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Spell Check

Edgerton, MN
3/28/2016 12:36 PM

  Why should the Farmer sell his Produce at Breakeven prices. No one else does, Seed companies and Grocery Stores have Hundreds if not Thousands of Percent markups.

Mt. Pleasant, IA
3/28/2016 05:58 PM

  Jeff, I think they are encouraging sales that will either break even or result in small profit (this year) because the upside is more than likely very limited. If you break even or bank a small profit you will be in business another year (and hopefully prices will be better). If you hold out for hitting a home run and prices tank after a good planting season then you may not be in business another year. It's all about managing expectations!


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