Sell or not? Farmers weigh factors
Days after the government confirmed tight grain supplies and 2010 corn and soybean crop sizes smaller than earlier thought, that combination has farmers pondering how far to go with 2010 grain sales in a marketplace that many see as bullish for quite some time ahead.
Based on last week's USDA reports, analysts and farmers agree there's more room for upside in the grains than there has been since the summer of 2008, when weather pushed corn and soybean futures to record highs. So, now that a few days have passed, allowing those numbers to simmer in the grain markets, what's the outlook for prices and how are farmers responding?
Sixty percent responding to a recent Agriculture.com poll say they're planning on holding on to the rest of their 2010 grain at least in the short term. Another 25% say they're selling the rest of what they've got. The prior camp, for the most part, sees room for higher prices, while the latter looks to cash in sooner rather than later, with current prices locking in profits for many.
"I'm going to hold the other 40% for either $8/bushel or $4/bushel, whichever comes first," says Agriculture.com Marketing Talk member 4wd. "I've got plenty of operating cash for now. I think with $14/bushel soybeans and $6/bushel corn, there will be a pretty profit to be made as long as you grow it in 2011 for all."
4wd adds he's still got most of his 2010 soybeans in the bin, and is wary of that market being "a bit too jumpy right now to start pricing them."
Marketing Talk member winger667304 says he has all his 2010 crops still in the bin, as he suspected the January 12 reports would provide support to grain futures prices. But now, other factors like the weather in South America have him hesitating before selling just yet.
"I'm having trouble pulling the trigger. Trying to find out what the weather is in Argentina and what the forecast is for the next few days," winger667304 says. "Along with that, add in the rumor of China now buying corn and there should be ample feed for the bulls to chew on. On the other hand, I have been a victim of this market before, so there is always that feeling of 'this is too good to be true' lurking in the background."