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Ag economist: wait and see grain marketing approach can work

An extension ag economist says a wait-and-see approach to grain marketing isn’t always a bad thing.

“It really depends on the structure of the farm and the farmer.”

Chad Hart with Iowa State University says the strategy can work if farmers can store the crop into next winter or spring, waiting for a seasonal bump in prices. But if storage isn’t available “it is better to be more aggressive, but to give yourself opportunities to capture any price growth that could happen. Oftentimes that’s using stuff like options, that give you upside potential, but limit your downside risk.”

Hart says now is the time when some farmers are deciding whether to market some grain, because of the uncertainty with Trump administration’s early August trade tariff deadline.

If a farmer decides to sell, he says there are two things to keep in mind.

“If I’m making that move, I need to give myself an avenue for upside potential and farmers should also consider how much crop they can store,” he says.

Hart says that’s in case future trade news provides greater certainty to the markets and better prices next spring.