When Do You Price the Grain

When do you price the grain?

First remember that the date you price the grain is different than the date you deliver the grain. We have two years to price the grain. We can’t deliver it until it is harvested or taken out of a bin. The pricing date is critical to a good marketing plan. It must be a drop-dead date in order for us to use the discipline needed to successfully execute the plan. With this thought in mind, we must establish a deadline or drop dead date when the grain will be sold regardless of price. Country Hedging has established two very good dates for the first two marketing seasons. March 31 is the deadline for the planting season plan. This date is chosen because that is the date the planting intentions are published by USDA. Markets tend to drop when these intentions are a know quantity in the market. The growing season ends on June 30. By this time of year we know whether we are going to have a crop or not. The pre harvest date should probably be August 30. The storage season dates can be much more flexible but the delivery dates need to correspond with when the money is needed. Roach Ag Marketing suggests that the best time to price everything is during the months of March, April, May, and June. Roach says that if we priced our entire crop in those months, we would be right four out of five years. You might want to make your deadline dates the 30th of each of those 4 months. This would include both the old crop in the bins and the new crop you are planting and watching grow. His dates come from years of data collected at a local elevator. These four months yielded the highest prices of the year. Be alert to the market and you should be able to discover those one out of five years that this system doesn’t work and adjust the plan to compensate for the odd year. These two systems will work well. You can choose whichever one you are comfortable with. Page 14