A look at new crop futures and bids for both corn and soybeans shows that recent levels offer returns that deserve attention. Recent new crop markets offer returns much above ISU estimated costs of production. How much return is the new crop corn and soybean market offering your operation?
The first step in a new crop marketing plan is to buy revenue protection crop insurance. This can give you the confidence to sell a crop before harvest with the assurance that, if yield is low and price goes even higher, the revenue insurance will help to buffer the lost opportunity and help fulfill earlier sales.
New crop prices and the resulting revenue possibilities are the best they have been since 2014! With the unpredictable markets (certainly the last year proves that!), the crop farm's income needs protection. No one can outguess the market direction or magnitude and it is your family’s income that is impacted by the risk. And every farm operation is different (risk bearing ability, profit goals, production costs, etc.)
How can a farmer ignore price predictions, spread sales over time, use a variety of marketing tools and manage emotions? A pre-harvest marketing plan! A marketing plan that is based on that individual farm’s costs, revenue goals and risk bearing ability can solve many marketing challenges. Scaling in sales at pre-determined price levels with time deadlines can provide the discipline needed to execute a plan. A marketing plan can help to lock in at least a portion of the 2021 crop to minimize the risk of lower prices by fall.
For a look at how Revenue Assurance works and how it can be used in a new crop marketing plan, there is a webinar March 3 at 1:00 pm featuring Kasey Engel, Regional Crop Consultant for Farm Bureau Financial Services and Ed Kordick, Iowa Farm Bureau Farmer Education Program Manager. The webinar will also look at pre-harvest marketing from a revenue standpoint. For more information and to register, please click here.
For a quick 6-minute recording on new crop revenue and marketing tool selection, go to https://tinyurl.com/revtools