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Get ready to lock and load, ladies!

Agriculture.com Staff 07/06/2010 @ 5:18pm

The grain and livestock markets have really been moving around in the last two months.

In case you haven't had a chance to notice:

  • Corn prices have dropped 65 cents
  • Soybean prices have dropped $1.25
  • Wheat prices have dropped 80 cents
  • Cattle prices have rallied $5.00
  • Hog prices have rallied $7.00

Despite this movement, the grain and livestock markets have and are currently offering potential returns on your investment. Do you know where a profitable and realistic return on investment is for your farm?

What's more, if you have a profit right now, do you know how to lock it in? Do you have the confidence or discipline to lock it in? Marketing is how you get paid for your hard work. Lack of knowledge and lack of confidence/discipline are some of the most common reasons why producers let profits slip away. If you know how to use marketing tools, you can lock in a price for yourself, and even leave yourself open to opportunity if prices rally.

Many business models set a goal of 15 to 20% return. For most businesses, that is realistic. Farm businesses, however, have so many variables--many of them, like the weather, uncontrollable. Some years a farm business is able to capture more, some years less. Knowing what is historically a good return for your farm is essential, so you can lock it in when you see it.

Yes, lock it in, Ladies! Don't let market predictions (outlook) or hopes or greed for higher prices blind you from a potential profit that is right before your eyes. In my experience, women are less likely to let things like greed or ego get in the way of making good decisions. It has to do with how we women are wired, I believe.

Women are more likely to make good and disciplined marketing decisions, or at least work with their husbands on marketing, because of these qualities:

  • Women are natural scenario planners -- we do it every day. Market scenario planning is a key to success because it prepares you for whatever market situation may arise, giving you the confidence to act no matter what the market does. (See my earlier column on the subject.)
  • Women are considerably less ego-centric about their actions (i.e., talking about their latest decisions at the coffee shop or elevator).
  • Women tend to not be so emotionally tied to the crop, making it easier to sell it. Armed with knowledge about what is a good return, women are more likely to actually make the marketing moves and lock in profit opportunities when they are there.
  • Women are able to discern that hitting the market high is not the most important thing. They are more committed to building consistency over time than hitting a home run.

Successful marketing ultimately requires less ego and more market scenario planning, knowledge and discipline. Women have these qualities, though perhaps few people have pointed them out for you because marketing has traditionally been a man's world. With markets moving as they are these days, good marketing is a critical part of the farm's success, and women can play a key role. May I suggest that you help your husbands with the concept of locking in value when you see it? Use those natural female qualities, and make it a great year for your family, as well as your farm operation!

If you have questions, you can e-mail Naomi or post a marketing question here:

The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Neither the information presented, nor any opinions expressed constitute a solicitation of the purchase or sale of any commodity. Those individuals acting on this information are responsible for their own actions. Commodity trading may not be suitable for all recipients of this report. Futures trading involves risk of loss and should be carefully considered before investing. Past performance may not be indicative of future results. Any reproduction, republication or other use of the information and thoughts expressed herein, without the express written permission of Stewart-Peterson Inc., is strictly prohibited. Copyright 2010 Stewart-Peterson Inc. All rights reserved.

The grain and livestock markets have really been moving around in the last two months.

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