Building a Price with a Marketing Plan
We keep you posted on commodity prices on this segment, but most important is your commodity marketing plan. Part of that plan might include having to contract, at times, and less than ideal levels. Joe Vaclavik recently shared his approach of building a price over time on the “Grain Markets and Other Stuff” Podcast.
Vaclavik… “I think you should try to build a price throughout the year. And that is what I attempt to do. So I looked at the bean market this morning and I looked at really two things. I looked at the calendar, I said, okay, new crop beans haven't been this good since, well, we were up to these levels a couple of times, the last few days, but really your best level since late March. And the other thing that I looked at were previous sales that I had on the books. And I've made good marketing decisions, I've made bad marketing decisions over the years. But I did make some good marketing decisions when the soybeans were much, much higher back say last summer and even until last fall. So I have some existing 2020 sales on the books. So I decided that I would add some of this because we're at two month highs in the market or three month highs in the market. I looked at it this morning and I said, you know what? This is a place for me to continue the process of building my price.”
How will you approach your own marketing plan for the rest of 2020? We’ll be back with a market update tomorrow.