3 Tips to Become A Better Grain Marketer
After a chaotic period of market highs and lows, 2021 is on its way to being a profitable year for many corn and soybean sellers. As we get closer to the typically high-profit months in the grain marketing calendar, it’s important to keep your head on straight and not make rash decisions.
Partnering with someone you trust to build your plan and help you stay the course is a key tactic for success. The team at Granular is always available to offer support as you develop marketing plans and make data-based decisions. Here are a few tips to help you become a better grain marketer.
1. Stick to Your Plan
You built a solid grain marketing strategy at the beginning of the year. You made data-based decisions and mapped out a plan for maximum profit. You had a full operational mindset when developing the plan, so keep your wide-angle goals front and center.
It’s important to acknowledge where you’re at, from a revenue or return-on-investment standpoint, then feel comfortable and capable of adjusting your plan as things change throughout the year. Digital solutions like Granular Insights can help you track your cost of production and set marketing break-evens.
As tempting as it is to stray from your plan, don’t let emotions take over. Stay focused and don’t get swayed by what’s going on in the world, rumors at the co-op, weather events or market dynamics. Though it can be beneficial to maintain some flexibility to change as data is updated, a long-term strategy will produce more success in the end.
“Embrace the emotion that comes with selling,” says Setzer. “Keep track of how you’re feeling when the markets move a certain direction, and your reactions. Understanding where emotions come from and how they affect you gives you more control.”
Further, once you’ve made a decision, trust it. Be confident in your choice and move on. Dwelling on the “what ifs” does not reduce your risk because your success is dependent on what you haven’t sold.
Finally, as you execute your plan, focus on the data available on your operation and the local cash market to make the most impactful decisions.
2. Let Technology Help You
Take advantage of all your resources – your local elevator’s text message service, a grain marketing insights email newsletter, or data from Granular Insights – to make the most informed decisions. Using data over emotions will help you feel more confident that you’re making the best, most profitable decision.
“Find something that you’re comfortable with and stick with it,” said Setzer. “Many of the growers I work with benefit from joining virtual peer groups to get valuable grain marketing insight.”
Keep your finger on the pulse of what’s happening around the world that could impact market behavior.
“The May 2021 WASDE report is a reminder that things might look a certain way in the beginning, but changes are likely, and a lot is riding on China,” said Setzer. “Keep close tabs on those reports. We are likely at a fork in the road where a demand issue could send everything lower, and a production issue could send everything higher.”
The “don’t put all your eggs in one basket” saying rings true with grain marketing. Don’t rely on just one marketing method to make your profit. While managing different positions and strategies can be more time-intensive, it also spreads out your risk.
It’s a good time to consider investing in more on-farm storage, and don’t rule out specialty programs just because “that’s not how you’ve farmed in the past.” Look at what premiums are available from input suppliers and processors in your area and make an informed decision. Some of them could offer your farm the extra income potential to put up that new bin.
Practice and Patience
Just as with any business, the more you do it, the more skilled you will become. Be patient with yourself as you continue to build and execute marketing plans and, as always, utilize trusted advisers and data along the way.
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