November 1 is an important date for two reasons. It is the date when farmers who have purchased crop insurance learn what the harvest time price guarantee will be for those bushels under their level of yield guarantee. Secondly, it is the date when most purchasers and processors of soybeans change their cash bids from being based on November futures to being bid based on January futures.

• Read more: RMA releases crop insurance fall prices

The crop insurance price guarantee is important because if the individual farmer has a yield loss that exceeds the yield level he or she is guaranteed, the settlement for the loss will be based on the October average price. This year the October price will be $7.50 for corn compared to $5.68 guaranteed this spring.

That is an improvement of $1.82 per bushel. For the bushels actually produced the farmer is still at risk of lower price unless those bushels were sold at the October price. The price for soybeans is $15.39 compared to a spring price of $12.55. That is an improvement of $2.84. If you are one of those individuals who has a yield loss this year you need to discuss with your crop insurance agent the exact details of how the indemnity is calculated.

The switch of cash bids from November futures to January futures is important because futures are typically lower for November than for January. Purchasers of soybeans usually adjust the basis to reflect the higher futures price. However, the basis is not always adjusted that way. Here in Eastern Nebraska the cash bid on November 1 was $.37 under November futures. The bid for November 2 is $.33 under January futures.

The result is that the cash bid was $15.10 after the close of trade on Wednesday and $15.27 after the close of trade on Thursday. Futures went up 11 cents but cash bids went up $.17. This kind of price movement usually indicates very good demand. The outlook for prices continues to be positive.

Basis of -$.10 for cash corn is also a positive indicator. It is just not as positive as the current outlook for soybeans. With nearly two months left in the calendar year, there is a lot of time for excitement in the market for both grains.