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Tidbits, Re-owning Corn, SAF, Markets & Rain Days Update 9/11/23

Market Comment

Brian near Alta in Buena Vista County, Northwest Iowa has chopped silage for six different farmers. Yields corrected to grain yield were all in the 150 to 185 range. All these farms yielded 210 to 240 bushels per acre the past two years. Brian has heard some silage appraisal yields southwest of him in the 35 to 100 bushel range.

For those of you considering “re-owning on paper” cash grain previously sold (meaning buying futures or call options or writing puts), just because you sold corn does not mean you necessarily have to re-own corn. If there is a different commodity that has a better prospect of making money, by all means, invest in that one.

In early March three years ago when corn was headed to a 14 year low, a prospective client was long a lot of corn and he was down more than $110,000. He was looking for help. At the time, Roger did not expect corn to rally and recommended he liquidate his long corn position and spreading beans and wheat (meaning buy beans and sell wheat). It took half as much margin money to spread and the bean seasonal trend was up and down on wheat. It was very painful and difficult for him to give-up on the corn, but after two more weeks of lower corn prices, he liquidated the long corn and spread the beans and wheat. Less than three months later, he had more than recovered his loss.

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