Grain Marketing Opportunities
Many times the best grain marketing opportunities for corn and soybeans in a given year come during or shortly after planting season (April, May and June). The latest USDA Supply and Demand Report, released May 12, projects a sharp increase in corn usage, less planted corn acres for 2006, and a significant drop in the estimated corn carryover for 2006-07, compared to current corn carryover levels. The result has been a sharp upturn in both cash corn and new crop corn prices.
Closing cash corn prices on May 12 were approximately $.25-.30/bu. higher than cash corn prices at local grain elevators in late March, and are now near $2/bu. There is a lot of 2005 corn in on-farm storage that is still not priced, so the coming weeks will be a good time to look at selling some or all of the remaining 2005 corn inventory. Many growers already claimed a loan deficiency payment (LDP) of $.40-.50/bu. on their 2005 corn last fall, so the addition of a $2/bu. market price results in a very favorable net price on their 2005 corn crop. There may also be some good opportunities in the coming weeks to price some of the 2006 corn production, and to even start pricing some of the 2007 corn crop.
There are a few deadlines coming up at county Farm Service Agency (FSA) offices that farm operators, and especially landowners in share-rent contracts, should be aware of:
June 1, 2006 is the final date to sign-up for the 2006 DCP Program, which is required in order to receive direct and counter-cyclical payments for the 2006 crop year.
May 31, 2006 is the final date to apply for CCC loans or to collect a LDP on the 2005 corn and soybean crop. After May 31, the PCP may still be used to release grain under loan.
July 15, 2006 is the final date to file 2006 crop acreage reports at the County FSA Office.
Check with local FSA Offices for details on all these deadlines and requirements.
Editors note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at [email protected].