‘Tis the season for…patience

Corn prices have gone down in the last few weeks, from $5.15 locally to $4.35. No reason to worry for AdFarm North Dakota shareholders, however.

Since August, corn (and soybean) prices had been soaring on news that U.S. grain yields were down and supplies around the world were tighter than anticipated. Yet during a few weeks in November, corn prices dropped dramatically. Why?

This year’s marketing committee takes guidance from Grain Marketing Advisor Mike Krueger of The Money Farm. He, and other proven grain marketers, believe that this drop in corn prices is a result of:

• Increases in the price of the dollar
• Funds
• Computer trading
• Rumors that China had less corn than expected due to early frosts in its main grain-growing region and was threatening to raise domestic interest rates or implement price controls

Most believe market will come back
The marketing committee met on November 23. With input from Cooperating Farmer Fred Lukens, the group continues its patience guidance, which includes:

• Predicted stocks-to-use ratio is about half what it was three years ago when corn hit $6.50 locally
• We sold 4,000 bu of our corn at average price of $3.35
• We have the balance of our corn scheduled for January delivery with a locked in basis of 75¢
• December is not a market-moving month
• Our breakeven at the 145 bu yield level is around $2.90/bu
• We’ll make our final sale decisions in January

Still in the bin

This year’s crop of about 10,100 bushels of AdFarm corn, Pioneer 39D97, remains in the bin. Fred says: “The grain is in good shape. With the cold weather, we’ll shut off the fans soon.”

Patience = profits

Meanwhile, remain patient, AdFarm shareholders. And have a lovely holiday season!

Farmers, how is your grain marketing going? What’s your take on the markets? We’d like to hear about your grain marketing moves.