(West Lafayette, IN) - Sell last year’s grain now at a very good price or wait to see if rising prices go higher. That’s the dilemna corn and soybean growers with grain from 2020 still in storage could be struggling over.
“There could be a good pay off to hanging on until the end. If you choose to do that recognize you’ve chosen a strategy that’s pretty risky,” said Jim Mintert, Director of the Center for Commercial Agriculture at Purdue University. His advice was in response to USDA releasing its latest monthly corn and soybean outlook report, which contained little or no changes from previous month projections. End of the marketing year average price forecast by USDA remained at $4.30 per bushel for corn and $11.15 per bushel for soybeans.
Nathan Thompson, Assistant Professor with the Department of Agricultural Economics at the West Lafayette campus, said farmers should factor the increased cost for storage when deciding whether to keep their grain from last year a bit longer. As an example, he said the cash price for corn right now is about $5.37 per bushel. Thompson said the same corn kept on site until July would have to sell for $5.48 per bushel to cover the increased storage costs. The same corn kept in commercial storage until then would have to fetch $5.57 per bushel.
Farmers also face similar dilemmas for this year’s corn and soybean crop. Thompson said the expected harvest price for corn in December is expected to be $4.62, an amount he called very favorable with potential to go higher. He said corn producers might want to consider locking in a portion of their upcoming crop at that price just in case there’s a downturn in the market. “I certainly think it’s something you should be thinking about,” he said.