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Take the stress out of cash sales

Agriculture.com Staff 07/06/2010 @ 5:05pm

One of our discussion group participants summarized in a nutshell what many of you might be feeling about marketing right now. "When I study the market and book at a good time for a good price I LOVE IT, when I sell and the price goes up I HATE IT, and it is just another job for the grain farmer. But if you don't do it right, you will be in trouble. We gamble every day with the market, I wish we had a crystal ball."

This is the time of year when corn and soybean prices seasonally begin to consider working lower. As was true this year, and in years past, prices have a tendency to work higher into April, then begin to consolidate sideways (neither up nor down on the chart), waiting for weather to justify the next price mover higher or lower.

As you know, predicting the weather is as impossible as outguessing the market. So why not just stop trying to predict the weather? Your seasonal window of cash selling opportunity is now, in this current time frame.

Talking to many producers, $4.00 cash sales was the price target they were looking for all winter long, because it would yield a profit. Yet, now that cash prices have achieved near these levels, there is hesitation to pull the trigger. Why? "Because it could go to $4.25," is what I'm told by many reluctant producers, plagued by second-guessing. Sound familiar?

Whether you are responsible for the marketing on your operation or not, there is probably stress in your household because of these decisions. But balancing fact with emotion can help you put structure into your marketing decisions. Think through your strategies in advance, then have the discipline to pull the trigger. That way, you can eliminate the pains that were so eloquently expressed by our discussion group participant.

One of our discussion group participants summarized in a nutshell what many of you might be feeling about marketing right now. "When I study the market and book at a good time for a good price I LOVE IT, when I sell and the price goes up I HATE IT, and it is just another job for the grain farmer. But if you don't do it right, you will be in trouble. We gamble every day with the market, I wish we had a crystal ball."

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