Here is a look at the average cash prices for Corn and Soybeans in Northern South Dakota. Interesting to note that it only has paid to carry Corn from harvest to the July timeframe 2 out of the last 5 years. For Soybeans it was worth holding onto beans 3 out of the last 5 years.
As we approach corn harvest with increased U.S and South Dakota production it is important to be aware of cash carries the board and basis are willing to give the producer. Corn spreads on the board are already showing carries of 13 cents for the Dec-Mar and 27 cents for the Dec-July. If everybody holds grain until the December-February timeframe, expect these carries to narrow. As we roll into corn harvest and get a better handle of production be sure to be aware where your production falls in line with your APH. With high guaranteed insurance prices ($5.65) be sure to give good thought of locking in excellent carries with some of your excess production.
From the looks of the questionable U.S. Soybean production and another year with a tight carry-in number, inverses look to be a common theme for yet another crop year. In general, the market is telling producers to sell their grain now not tomorrow. As of today, Wheat Growers is showing a slight cash carry to hold beans until December, but other than that we are steadily inverted cash wise into next year. Opportunities to lock in firmer basis fixed contracts off of deferred months might prove to be a solid marketing strategy. For example, the Nov-March soybean spread is trading at a 13 cent inverse and NC beans into most of our shuttle loaders are at -72 SX13. With the current spread you could lock in a -59 SH13 for the NC delivery timeframe. With this option you must deliver during the NC timeframe, but you have option of waiting to price the futures component of your Basis fixed contract until February 27, 2014.
Contact your local Grain Marketing Specialist today to discuss any of the above information or to discuss contracts and marketing strategies for what looks to be another exciting marketing year!