Seasonal Average Pricing Contract:
April 12, 2018
Seasonal Charts on soybean and corn futures show the tendency for new crop contracts to put their Seasonal highs in June and early July. Therefore, that period is often the most advantageous time of the year for forward contracting harvest bushel.
Most people recognize that the summer is the height of uncertainty:
- Domestic supplies are dwindling
- Prices are rallying trying to pull remaining supplies into the pipeline
- Its hot and dry!!! Will crops survive?
At this time the 2 market emotions run wild.
- Fear ***** I can’t forward contract grain, it’s all burning up!!!!!!!
- Greed *****Oh, surely, I’ll get another dime higher next week!!!!!!!
Average Pricing contract are designed to take the emotion out of the marketing decision and by aligning the contract to price during the seasonal high period; odds are high that a favorable price will be locked in on the harvest bushels.
GFG will offer “Seasonal Average Pricing” contract for corn and soybeans this year. The pricing mechanism will be simple and clear cut. So simple that we will post the running averages on our website.
Starting June 8th for everyone who has signed prior to June 7th, 2018 we will price equal amounts of bushels over the next 6 Friday’s (including June 8th). From those 6 pricings we will derive a simply average price (rounding up to the nearest quarter of a cent). Those pricings will be used against your fall basis contract which is established when signing up for the contract which will complete the cash contract for the enrolled bushels on Friday July 13th, 2018 (the final pricing day).
We will accept any # of bushels in the program. Please consider this as another Price Marketing tool.
A 10 yr study of pricing results can be viewed in the following link:
- April 11, 2018 - Moore Research Soybean Seasonal
- April 11, 2018 - Moore Research Corn Seasonal
- May 31, 2017 - Weekly Crop Progress and Conditions Update Through 5/28/17
- May 25, 2017 - Weekly Export Sales Summary Through 5/18/17
- April 11, 2017 - Updated US Supply and Demand Spreadsheet for Corn and Soybeans
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