Posted by: usset001 | July 5, 2010

2009 Baseline prices for corn, soybeans and spring wheat

How do you measure your performance in grain marketing? As an example, let’s say you received an average price of $9.00 per bushel for your soybeans produced in 2009. Did you do a good job of marketing soybeans?

I think your first measure should be profitability. For comparison purposes beyond profitability, I recommend tracking a baseline price over the course of a reasonable window for marketing a crop. For a baseline price on my mythical farms, I use an 18-month period starting in January of a new crop year and ending in June of the following year (my baseline prices for each year are posted on links next to my marketing plans here). In January of 2009, I started tracking a baseline price for the 2009 – the process ended in June of 2010 (Hey, haven’t you met Hank Holder? You should be done by the end of June too.). By the way, I see no need to make this difficult. There is no need to track prices in your local market every day. I simply use one quote per month, in my case the 2nd Friday of each month.

When you have completed the sales of your crop for that year, compare your weighted average selling price against the baseline. I think a good marketer should be able to beat the baseline average price more than every other year. I think your market advisor should be able to beat the market price more than every other year.

You track your yields every year to see if you are making progress as a grain producer. Why not track an average price to see if you are making progress as a grain marketer?


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