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SE MN | My thoughts are that we have had chances to sell $5.00 CME Dec corn for 2026 and 2027. Will that work for every individual operation to be profitable? Probably not. But is that a good price historically? Absolutely. If a farm has had several years of losses and can't afford to have another large loss then that farm should have looked at what their risk is if corn goes back to $4.00 on the board and done something to reduce their risk. Unfortunately for me I am in that boat so I decided that $5.00 Dec 26 was a number I needed to protect and spent some $$ to do that. Feels a lot better right now because I did that. As you have stated, we are running a business and we need to protect ourselves against what might happen. There are tools to do this. Options spreads, HTAs, short the board, straight cash sales.
Odds are that we will grow more bushels than we really need. It works that way 80% of the time. I usually think to myself, how will I feel at harvest if I had a chance to sell $5 Dec corn and didn't and now I'm delivering $4 Dec corn? I am usually very happy that I did something to protect my equity and working capital and don't have to depend on another direct deposit from Uncle Sam to keep my business moving forward. | |
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Is the fat lady singing?
