When Will Commodity Prices Increase Is a Big Farmer Question
By Theresa Seiler—National Farmers Grain Marketing Plus
In Colwich, Kansas, spring planting has begun on my family farm. Next to harvest, it’s the best time of year. It’s a time full of anticipation and promise of what is to come. There is a lot of hard work and long hours between planting and harvest, but that’s the life we live and love.
It goes without saying that when farmers plant their crops, they plan to sell them or feed them to their livestock. Either way, the goal is to make a profit and provide for our families.
When the plan is to sell the crop, having a marketing plan is a must. A good marketing plan includes knowing your farm’s cost of production, estimating realistic yields, determining when and how much to sell, and following through with your plan.
In addition to documenting your marketing plan, it is equally important to re-evaluate and adjust your plan as the year progresses. Both will help you not to lose focus while planting and caring for your crops.
Commodity prices over the last three years have been at record highs. This should have made it easier to sell and make a profit. However, with those high prices in our recent memory, it can make it harder to sell this year’s crops at lower prices. Most producers are familiar with the idea that the cure for high prices is high prices. So, it should not be a surprise that markets have moved lower.
The current question is, ‘How low will the commodity prices go before turning up again’? If I had priced this year’s crop when prices were first posted at my local co-op on 11/2/23 for 2024 harvest, I could have secured 30 cents for corn and milo, to 88 cents for soybeans and wheat more than the posted market prices on April 3.
Whether those early prices will be the highs for this year’s crops is yet to be determined. In the meantime, my job is to price our crops at profitable levels.
Although I have not contracted all our expected production for 2024, I have already started looking for pricing opportunities for our 2025 crops. If you plan to farm in 2025, you should too.
