Market for Profits, Not Trophies

November 11, 2015 11:48 AM
Market for Profits, Not Trophies

With the current volatility of the grain markets, farmers must have a marketing plan in order to maximize profitable opportunities. The days when no plan was the best plan are over.

Randy Weber, who has been growing food grade corn and soybeans for almost 40 years, says many farmers today don’t have a marketing plan and that will hurt them in tough times.

“Some people don’t have a marketing plan because it’s been too easy to make money without doing anything,” he says.

Those days are gone according to Angie Setzer vice president of Grain for Citizens LLC. She says some producers developed bad habits over the last seven years.

“From 2008 to 2012 the market paid guys to not have a plan,” she told “AgDay” host Clinton Griffiths. “That’s not the case anymore.”

Weber says older farmers who have farmed through downturns like the 80s and early 2000s understand the need for a solid marketing strategy.

“You have to have an effective margin,” he says.

Setzer agrees and she encourages farmers to stop trying to sell grain at the highest point of the year.

“I love to know that I sold my grain at the highest price of the year,” she says, “but guess what, it doesn’t work that way.”

The first step to developing a marketing plan is to determine what your breakeven price is according to Setzer.  

“You really need to figure out what your cost of production is,” she says. “Once you know what that is, then you know when you can make sales and when opportunities present themselves.”

She says when it comes down to it, farmers need to start marketing their grain for profit, not trying to capture the high because the high is allusive.

“You really need to be aware of the risks that are at hand and stop trying to sell at the high,” she says. “Sell into rallies, know when you need to move grain and what your cash flow need is.”

Seeking a profit is the best plan she says, “You can’t go broke if you’re making money.”


Watch the full “AgDay” segment with Setzer below:

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Spell Check

Chappell, NE
11/12/2015 10:14 PM

  Interesting you folks are always so worried about what my cost of production is but you never ask about production costs of fertilizer, fuel or equipment.

Jordan, MN
11/12/2015 11:17 AM

  Wayne, I agree with you. Too many farmers have been sloppy with their true numbers over the past few years - high prices allowed them to do that. Now, financial planning weakness has come home to roost. If one can't budget for a profit in the spring, there surely won't be one in the fall.

Kearney, NE
11/12/2015 07:15 AM

  "The first thing you need to know is your cost of production" This is something you only know after harvest is completed. This is when you find out what your actual production was, and it's also when any unexpected expenses can be accounted for. Anyone who claims to know their actual cost of production before that is deceiving themselves. What a sophomoric article.


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