Contributed by Steve Johnson, Extension Farm Management Field Specialist,firstname.lastname@example.org.
By harvesting some of their corn early and delivering directly in to local corn users, such as processors, livestock feeders and ethanol plants; farmers could potentially earn a premium of 50 cents per bushel of more over cash prices offered in October. That premium price is likely to disappear quickly in early October, when the 2013 fall harvest begins to pick up more momentum.
It’s really going to be a win-win situation for grain users and farmers. Corn users are looking for corn now after last year’s short crop and farmers could use this to earn premium prices and help their fall cash flow situation.
There could also be a few marketing opportunities on early-harvested soybeans. Like corn, processors and river terminals are looking to secure a local supply of soybeans after last year’s drought-reduced harvest.
Iowa farmers are fortunate because there is a strong demand for corn and soybeans in the state. That can create marketing opportunities that are not available in all states.
A good strategy for Iowa farmers this month is to keep a very close eye on the moisture content and quality of corn in their fields during September as well as bids from local buyers. If the moisture content of the corn drops down toward 15 percent, or if there are signs of stalk rot or other problems that could trim yields, it may make sense to harvest some of the driest fields early and try to take advantage of a cash bid premium, he said. Even if the grain is still above the target moisture level of 15 percent, the premium for early delivery may more than make up for the dockage.
In years when the crop is less than ideal, there is a tendency for Iowa farmers to store corn and wait for higher bids later in the marketing year. However, those higher bids may not materialize in the upcoming marketing year because other parts of the Corn Belt have experienced better growing weather and may have more corn to market. I think it will be good to take an aggressive marketing approach this year and to look for early opportunities.
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