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Central Missouri | The string below got me thinking of this because it appears that so many look at price in the instant instead of the intermediate to long term. The near term focus that it is a presidents fault that soybean prices arent higher seems short sighted to me.
The world has had the same bean production no matter what the president has done
AND the world has had the same demand no matter what the president has done.
Do you really think that soybean prices would be a dollar or two higher knowing that the world supply and demand hasnt changed.
Now for you in the dakotas it has affected your basis no doubt!
So business tactics, on the chart in the blue area forward sales should be the montra because in commodity production price gravitates to variable cost of production over time and beans in the teens are way over variable cost. One should also set their business up for when price inevitably goes to variable cost so they can survive and thrive in it.
So what does a business do in the red area? Same as what china has been doing in the red area. Set your business up to be long or short bought instead of shortnor forward sold like in the blue area. Think forward in your marketing while managing your business risk and cash flow. just a few thoughts this morning. Dont get stuck in the here and now.
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Grain Production business tactics
