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My Grain Marketing advice
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ruralHusker
Posted 6/26/2020 08:59 (#8337028 - in reply to #8336778)
Subject: RE: My Grain Marketing advice


West of Lincoln a little bit
I should do this to track basis better. I have trouble remembering what the typical patterns are without looking at my old sales.

During these tough years when marketing is hard, I do something similar during the spring to track CBOT. Every day I record the Dec Corn open/high/low/close. I play a little marketing game in my head with the co-op... I try to sell small amounts on days it closed higher than the previous day, and then see if I beat the contract type the co-op offers of averaging all the daily highs for grain sales during a set period (usually spans 2-3 months during the best seasonal time)... I do this in years when I know I need to force myself to make more sales (like this one!). I do end up beating the average of all the highs, and it helps me get sales on so I'm not selling everything in a panic at the wrong time. At the beginning of the time period I establish how many bushels I want to sell and assuming I will sell an average of every other day (choppy market). Of course it doesn't always happen like that, sometimes I sell several days in a row, other times I'll go a week without selling. But it tends to average out pretty close to my total volume goal over that timespan. This also helps take some of the emotion out of it since I'm trying to beat the opponent (daily high avg). In years when nothing makes sense and I'm having a hard time figuring out what to do before I run out of opportunity... this method works for me. I also include instructions to myself on how much to sell. So if it's under $3.50 sell x, sell a little more if $3.50-$3.75, etc. or if it's a big day that gained 5c or more, bump up the sales to reward the bump. That helps raise the avg also. My target ranges change depending on the year and what I think is reasonable to obtain. But in case it doesn't get there (like this year), then at least I sold something at what was possibly a good price for the year (even if I hated it). One of my grain buyers told me he had a guy who sold the same amount every Monday during the spring, and he tended to average the same or better than the guys who had fancy systems trying to time the market. I decided to adapt something similar to see if I could remove emotion and make logical sales to get a base hit or better result.

note: I do this for forward contract sales (harvest delivery or winter just after harvest), but could be done for catchup sales from last year's crop also.

A lot of variations are possible with this, but maybe it will help a guy make some sales when every decision feels wrong (like this year).

I also like target orders, but I often aim too high and then get stranded with no sales when they aren't hit. Combining these two methods means I at least got something sold. If a target order gets filled during my game then I can always adjust my sales target volume lower so I don't accidentally over sell.


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