Your PreHarvest Marketing Checklist

Here are five steps to ensure a proactive, profitable plan. ( AgWeb )

As harvest nears, it’s time to revisit, update and tweak your grain marketing plan. “Most of your production costs are well-known at this point, and you should have a good estimate of expected yields,” says Richard Jelinek, vice president global education at INTL FCStone Financial. Plug those production numbers into your preplanting marketing plan. Spend the next few weeks considering a variety of marketing tools that fit today’s challenges, and employ these marketing strategies. 


Determine your “must-move” bushels that are beyond your on-farm storage capabilities, says Carrie Johnson, product line leader for Cargill Ag Marketing Services. Visit with your buyers, so they have an idea of what to expect from you.

Know your post-harvest sales tools. “If you are expecting prices to rally after harvest, storage shouldn’t be the only consideration,” says INTL FCStone Financial’s Jelinek. 

Estimate all of your costs of carrying grain. Then you can determine if you should store grain or use a marketing tool. “If you know you’ll need some cash flow this fall, you may want to consider selling the necessary amount of grain and then buy call options,” Jelinek says. “This alternative provides you with a gain should the market rally, just like storage, without the hassle and costs associated with storing that crop.”

For example, you sell 10,000 bu. of corn at $3.80 to your elevator at harvest, while at the same time buying a $4 March Corn Call option for 10,000 bu. for a premium of 15¢ per bushel. This locks in a floor price of $3.65 ($3.80 - 15¢ call premium). You capture any price increase above $4. If prices don’t top $4, your call will only cost the 15¢ premium, which was already paid and built into your floor price of $3.65. 


With a 24/7 news cycle, grain market chatter can fill every minute of your day. Reduce some of that clutter and step away from the daily market swings, Johnson coaches.

“There’s a fine line between being aware and educated versus obsessed with it,” she says. Don’t be paralyzed by information overload. Instead, always go back to your profit margins and marketing goals.


“In the grain world, the most important thing is basis, basis, basis,” Jelinek says. “You need to stay on top of how basis is reacting in your local area.”

Collect basis for your delivery locations at least once a week to create a historical record to see how current basis is behaving compared to normal levels, he says. Watch for patterns to indicate marketing opportunities. 


“All the different strategies have different risk-reward profiles,” Johnson says. “You need to know your willingness and ability to take on risk.” 

Sleepless nights because a strategy might not be profitable is a big price to pay. “You don’t want to get into a strategy you don’t fully understand,” she advises.

Your ability to take risk is mostly inhibited by your cash flow, as some marketing tools have expensive fees. Work with an advisor who can help you identify the best options for your farm. 


Your farming team and partners will question your marketing decisions. No matter what, you will not make perfect moves every time, says Katie Hancock, a marketing consultant with Brock & Associates and Kentucky producer.

“Marketers have to be decisive and thick-skinned,” she says. “If you make peace with imperfection, you will be able to make tough choices. Without this acceptance, emotions will interfere. In my opinion, the worst decision is not making one.”

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