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ECIL | When you say contract, is this crop you have forward sold or is it a production contract? As for the other half, do you plan on selling off the combine or storing for a later sale? If it is stored at the elevator you will have storage charges accrue or be billed for a minimum time frame, depending on the elevator. Stored on-farm will be cheaper most of the time compared to commercial storage. The price for either a cash sale, such as off the combine or sold on the spot market out of storage, is determined by the CBOT contract nearest the sale date, less basis. If you wanted to make a sale in March and thought the price for March was good the price would be taken from the March CBOT contract, less basis. This could be contracted anytime until March, when it becomes a spot cash sale. Grain sold off the combine is considered a spot cash sale. Basis can be contracted separately, but that is a different topic. | |
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Beginning Farmer ?
