After you have harvested your grain, you need to know how to maximize your grain profits. Do you store your grain or contract a trucking company that provides hopper bottom jobs to take it to market? These are a few tips for getting the most out of your harvest.
Using a forward contract, you may sell your grain at an agreed price before it has been harvested. These are beneficial tools if you do not believe the price will go higher than the contract price. Otherwise, you lose some of the money you could have made if you sold it after harvest. Because supply is higher during the harvest season, the contract price is typically higher than the harvest price, so losses are uncommon.
Droughts that diminish your crops can make it challenging to fulfill your forward contract, however, so many farmers only contract a portion of their crops.
If you have grain elevators or other storage capabilities on your land, you may not be as concerned with storing your grain until the price rises. However, if you have to rent storage from local elevators, your cost reduce your profits. Consider creating a storage and sales plan that outlines the absolute longest you want to store your grain and the amount per bushel you will sell at. You may also forward contract a portion of your grain and sell the rest at the highest price you find as long as your profits are not impacted too greatly by storage costs.
Your emotions should be under control at all times. The grain and commodities markets fluctuate significantly. You don’t want to let this fluctuation affect your mood and happiness. In addition, you don’t want to be greedy, waiting too long for the market to recover and losing even more money on either storage costs or a market that did not recover.
Developing a comprehensive marketing plan and controlling your emotions will ensure you get the profits you desire from your harvest.