Market to Farmers: “Hold That Corn”

 
Pulse_Corn_Production

The price of corn has been volatile the past three years, but one thing has remained fairly steady – most farmers are content with holding onto the majority of their grain, at least for now.

Farm Journal Pulse has polled farmers in mid-August for the past three years on how much of their grain they had priced or sold by that time of year, and the results have been more or less steady.

The amount of farmers who haven’t sold or priced any of the 2015 crop hit 42%, up slightly from 2014 (37%) but down slightly from 2013 (47%). Each subsequent tier drops steadily. Only 17% of respondents say they have priced or sold at least half of the 2015 crop. Only 4% say they have priced or sold all of the crop.

Those amounts are not identical, but are consistent with 2013 and 2014. In 2013, 15% of Pulse respondents say they had sold or priced more than half their crop as of mid-August. In 2014, that amount was slightly higher, at 22%.

It’s as if the markets are telling farmers, “Hold your grain” – and farmers are listening, according to Tommy Grisafi with Advanced Trading. He says with the massive grain bin expansion that has occurred over the past five years, farmers have opened up their options.

“We’ve built an incredible amount of storage, so we’re more in control of our grain than ever before,” he says.

Grisafi says with an abundance of grain stocks on hand, farmers simply aren’t being incentivized to sell right now. Hopefully, many still have the ability to wait, he says – he’s confident they will act quickly if circumstances change.

“If it was $7 corn, it would be flying off the shelf,” he says.

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Comments

 
Spell Check

Mark Fick
Lake Ciy, MN
9/14/2015 09:12 PM
 

  I agree with the $6.00 price holdout. Unfortunately, cash flow needs end up winning out. We all have expenses to meet and the banker will only wait so long. That's the biggest problem for many of us.

 
 
itradertv
NEW YORK, NY
9/15/2015 04:25 AM
 

  Yes maybe it works on 2014 because August price was $3,75 then end of year was $4.15 but August 2013 corn price was $5 end of year it was $4.20. So holding stocks is not work all the time, it has own risk plus, all farmers has expenses why they are producing ? to hold in their stock? I don't think so... There is no need to be worry 3 years falling trend has been broken also we have new trend which started on $3.18 touched $3.45 and $3.60 now it is $3,92. Will it be continue, who knows? but at least vision is more possitive then 2013 or 2014

 
 
Stanton
Oblong, IL
9/15/2015 11:26 AM
 

  http://www.extension.iastate.edu/agdm/crops/pdf/a2-11.pdf Corn has averaged over $6 twice:2011 and 2012(worst drought in history) once over $5: 2010. Poor Mark C. Daggy lives in the dream world of the old NFO!

 
 

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