Is 2023 when the shoe drops? Or will it provide some of the same profitable grain marketing opportunities as 2021 and 2022? Questionable corn demand and expected production highs in South America bring major questions to the corn and soybean outlooks. Yet positive factors are evident. Top Producer asked eight analysts to provide their best estimates on price direction and market strategies you can employ this year. Here is one of the eight.
Angie Setzer, Consus ROI
For 2023, key market factors are the same as 2022 — China demand and South American production. China reopening makes me optimistic on demand for the first half of 2023, but South American production will have a major influence on whether that demand is fulfilled by the U.S. or Brazil.
What happens in the Black Sea will continue to influence the market, though volatility will likely be reduced as the world end user grows accustomed to sourcing their needs from other suppliers.
Whether or not we manage to avoid a global recession will have a big influence on market values above all fundamental factors.
Many farmers will find they are already above breakeven when looking at current market values and production potential. There is a lot that could happen over the next year, so make sure you’re covering your fixed costs and looking to cover additional expenses, within in reason, as they arise.
Utilizing hedge-to-arrive grain contracts will help you capture strength in futures without having to overcommit at a potentially wide basis value on deferred sales.
I would also look at using options to manage your downside price risk between now and when spring crop insurance values are set.
Read More
Mark Gold: Protect Profitable Prices with Put Options
Alan Brugler: Consider Grain Holding Costs and Set Price Floors
Matthew Kruse: Avoid Market Noise and Stay Focused on Price Targets
Naomi Blohm: Use Seasonal Grain Tendencies to Your Advantage This Winter
Bill Biedermann: The World Needs Both North and South American Bin Busters
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