As the calendar flips to December, farmers may be working on year-end bookwork and making financial plans for the approaching 2025 crop season. Farmers may also be contemplating their next move regarding their grain marketing plan.
With harvest wrapped up, many producers likely have grain stored in the bin at home. Should they sell some of that binned up grain soon or wait and hope for some sort of price rally?
When looking at grain market fundamentals, the November 2024 U.S. Department of Agriculture’s World Agricultural Supply and Demand Estimates report had supportive underlying tones to it, due to lower-than-expected corn and soybean yields and strong demand. Yet, overall, prices for corn futures have been trading in a modest 20-cent range for nearly one month, and March 2025 soybean futures prices sit near $10 a bushel price support, as of this writing.
“Now what?” A client recently asked me. The question posed sarcasm, philosophical tones and genuine curiosity regarding how grain prices might trade into year end and early 2025. “I’m not totally sure,” I responded. “We need to be ready for anything.”
From a marketing perspective
As we head into year end, be mindful and ready to manage your grain marketing consistently in the coming weeks and early months of 2025.
U.S. grain ending stocks are viewed as adequate. Because of this, grain futures prices may struggle to find reason to rally triumphantly in the months ahead (barring some Black Swan supply or demand event).
Yet, there will be plenty of newsworthy items to offer market movement, either higher or lower.
Traders will constantly be monitoring global economic jitters, a new United States administration, South American weather, fund trading activity, the December USDA WASDE report and the potential competition for planted acres in the U.S. this spring.
Which way will the pieces of news ultimately fall and tip the price scale?
My advice is to make a strategy that allows your farm to be prepared for any scenario. Don’t wait and see. Be ready to act on opportunity.
Prepare yourself…
Start looking at technical charts for corn, soybean and wheat markets. Know where support and resistance levels are on those charts, as they may help create pricing opportunities for your cash sales. Decide where and when you want to pull the trigger on those cash sales. Get those orders working with your grain elevator now.
Good marketers also have contingency plans in place so they can act when they see an opportunity or protect themselves against tumbling prices. It takes a well-balanced blend of fundamental analysis, knowing your local cash market, weighing both U.S. and global economic news, watching geo-political drama, understanding technical charts and having discipline.
Scenario planning is the process of creating possible future outcomes: sharply higher markets, markets that stay low for two years at a time or markets that stay consistent. Scenario planning is forward thinking. It’s preparing your farm for anything the markets may throw your way.
Be ready for anything; there is plenty of uncertainty ahead.
If you have questions, you can reach Naomi at [email protected] or find her on twitter @naomiblohm.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Carefully consider whether such trading is suitable for you in light of your financial condition. Examples of seasonal price moves or extreme market conditions are not meant to imply that such moves or conditions are common occurrences or likely to occur. Futures prices have already factored in the seasonal aspects of supply and demand. Total Farm Marketing refers to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency and an equal opportunity provider. A customer may have relationships with any of the three companies.
