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CEA Producer Meeting 1/20
5
GRAIN MARKETING
moving from risk
to opportunity
Risk or Opportunity
risk =
the possibility of loss
Risk
or
Opportunity
opportunity =
the possibility of gain
RISK
Tip the Scales
OPPORTUNITY
Reducing Grain Marketing Risk
> know your cost of production
> understand historical price movements and averages, leave the bad ones
> set goals
> consider upcoming capital needs
> make a plan, adjust plan
> compare apples to apples
> execute
> don't stop
Increasing Grain Marketing Opportunity
Increasing Grain Marketing Opportunity
> use cost of production to create targets
> understand historical price movements and averages, grab the good ones
> put goals in plan and find ways to achieve them
> use available tools
futures only, basis only, minimum price,
JSA Select, MAC, and target offers
> don't stop
Tools of the Trade
Tools of the Trade
Futures Only
Futures Only
> forward marketing tool
> futures established to eliminate downside futures risk
> basis left open for upside basis opportunity or downside basis risk
> target offers can be used to capture desired futures only contract
Basis Only
> can be used in current or forward market
> basis established to eliminate downside basis risk
> futures open for upside futures opportunity or downside futures risk
> if futures are not established by the end of the established period, the basis contract will be rolled and result in the spread difference being added to the basis
Basis
Only
Minimum Price
Minimum Price
> establishes a floor and provides potential for futures improvement opportunity
> can be used for forward marketing or after delivery
> eliminates futures and basis market risk
> able to receive payment for minimum price upon delivery
> can use target offers for execution
JSA SELECT
fall crops
JSA
Select
> establishes futures only contract
> futures are priced by a dedicated team of professionals utilizing their experience and knowledge
> email updates
> deadline January 31
> pricing period February 1- Aug 31
*wheat sign up for
2021 available in the fall
arket
M
A C
ontract
verage
MAC
> establishes futures only contract
> futures are mechanically priced during historically proven pricing period
> email updates
> deadline for '20 wheat, January 31
> deadline for '20 fall crops, March 31
> pricing period for '20 wheat, February 1 through March 31
> pricing period for '20 fall crops, April 1 through June 30
Target Offer
> establish futures only, cash price, or minimum price target with automatic execution if the market touches the offered target price
> can be used for forward marketing or after delivery
> eliminates risk of missing your target
> free
Target Offer
The Right
Partners
OPPORTUNITY
The Right Partners
COOP
Smith
Farms
CEA
Farm Advisement Team
Hillary Birtell
308.440.6788
Jeff Frazier
316.570.2239
Lacey Seibert
580.370.1133
Farmers Cooperative Association of Snyder