Those of us who are busy with harvest at the moment are probably dealing with quite active grain markets. Whilst prices are high in comparison to previous years, they appear to be on the way down, at least for the commonly held grades this year.
Personally, I find the grain marketing part of farming really hard. I often joke that I could offer a subscription marketing service for $10 a month where I let everyone know what I have done, so they can do the opposite.
This is what I keep telling myself (often several times a day), and really it applies to livestock and wool marketing just as well as grain.
1. Perfection is unattainable
You are never going to sell 100% of your crop at the top price for the season. Face facts, it's impossible. If you keep comparing every single trade to the top price for the season you will go mad. Kate Burke, in her excellent book Crops People Money and You , quotes Ron Storey, a grain marketing veteran who estimates that even the best grain sellers only achieve $20-$30/t more than their less skilled peers, but they won't do that every year.
2. Don't look back
Trades that today look bad may in a month's time be excellent. A trade you made last month that you felt was dreadful may have little impact on your overall averages at the end of the year. Either way you cannot turn back the clock. Whilst reviewing your strategy might have merit (eg how much you forward sell each year) revisiting individual trades does not. Calculating the money individual bad trades lost and then assigning the money to something you now can't afford is a high level exercise in self torture. It won't improve your grain trading skills and it won't change the situation. The same goes with looking at prices for downgraded wheat, if it downgrades were not so widespread the price may not have reached the current levels, so don’t bother running the numbers on this hypothetical situation either. Don't look back.
3. When cash flow is king, wave goodbye to price regret
If you need to sell for cash flow reasons, time of sale and therefore price is essentially a variable out of your control. The extra fert or chem you needed, or the unexpected breakdown that got you into this spot had to be dealt with at that time. Suck it up, sell the grain, pay your bills and move on.
Have a Merry Christmas and I wish you a great 2022, which will no doubt be full of it’s own unique challenges and opportunities.
Words by Carmen Quade, AgriFocused