Grain markets since the beginning of the year have been on a tear. Opportunity has been abundant to retain profits, forward contract new crop for profitable values, and to manage risk. The recent planting intentions report from March 31st paints the picture of continued tight stocks for the 21/22 growing season. Both domestic and export demand continues to be strong for corn and soybeans as we enter the planting season. All signs point to steady/ firmer markets. But also keep in mind a good growing season should bring quality yields. With the recent rally we may see the planting report on June 30th show larger planted acres of corn and soybeans than were noted on the March 31st report which might bring pressure to markets come late June into July.
The next big wild card is weather. A lot of conversation of drought pressure and warmer temps throughout the summer which could put pressure on pollination. As we can’t predict the future, one thing we can do is protect profits. There are certainly contracts available to protect profitable values as well as leave room for further improvement. Our Compass programs can bring added value like the foundation, price builder, and daily price contracts. Min price contracts could be used to open up participation in any rally to come. Min/max offers a floor to protect profitability today, but allows room for further participation in any rally. Bullish markets are exciting and fun. Don’t let the party end and be left without a way home. Sales in the next 60 days should be considered as we begin to finalize some unknowns like planting progress, export demand strength, feed usage, and early growing season moisture levels.
You can contact our grain team to help you decide what contracts would fit best for you!
Written by Brady Beyer, Grain Originator