Markets Now: Stick To Your Plan, Ignore The Noise

September 28, 2018 01:59 PM
 
 

Right now, the markets are dealing with new trade news coming at them every day. While that can create an overwhelming feeling of uncertainty, these analysts say ignore the noise and focus on implementing your marketing plan.

“This is the talk of the day, but the strategy is still the same. You've got to make a forward sales count,” says Mike North of Commodity Risk Management Group. “We have near $4 corn for next year and we've got a soybean price that's still pushing north of $9 for next year. We've got options available so that we can get lines of defense, put options create a great floor for us. I think you make proven sales and you protect the market and you don't get wrapped up in all the noise because there's going to be a lot of it.”

According to Andy Shissler of S & W Trading, the trade situation is like a game of dominos. A deal with Mexico was worked out first because we have a lot of economic interests there he says. The same can be said for our trading relationships with Canada and Japan.

“The one place where we don't have even flow of money is China, so it’s last [in the line of dominos],” he explained. “So, they they're going to set their dominoes up first and these will all go down. The last big one is China.”

He says the only way we will work out a deal with China is if everybody else is in agreement but them and it becomes difficult for them.

“I'm positive, it just takes time,” he says. “You think that we're going to fix 10 years of trade with China in three months, it's never going to happen. But you can start the process and we can make changes as it goes.”

He says he agrees that the U.S. and China don’t have a trading relationship that is free or fair and that President Trump needed to bring the problem to light. However, it’s causing brutal pain for farmers and that bothers him.

“I hate it, but I understand what they're trying to do,” he says.

According to North, there’s no question this process is painful, but it’s one that was overdue.  The best thing a farmer can do is get some targets out there, North says. Put your marketing plan into practice.

“There's still volatility in this market and we're dancing right at $4. If you could take a farmer back and ask him right now, ‘would you sell all of your corn today at $4 for 2018? What would his answer be?’ He’d say, ‘Absolutely, yes,’” North says. “Keep your eyes on the prize. Don't let go of the fact that there's still opportunity out there even in the midst of all the noise.”

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