Business
Hello I’m a beginner farmer grain didn’t turn out like I wanted to I have about 5000 bushels that I’m not able to produce what is the process
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I would see If you can roll the contract or if you have to buy it out. Generally we only book around 60 percent of our anticipated crop to try to avoid those issues. This year was tough and with poor yields where we are and a lot of other areas it wasn’t hard to be oversold.
There could be a act of god clause in your contract to use if you are on the losing side of the price
I agree with iL guy. If you choose to get out of the contract. They will make you pay difference in cash that day. Don’t let them charge you a cancellation fee. If they owe you money don’t let them get out of that. Coops and some elevators will keep the money. They will tell you it’s illegal to pay you. It is not illegal. They are just dishonest. Cargil bungee Chs. Will all not keep any of...
Talk to your elevator but your Options would be Roll it, Cancel it, or buy grain to cover it.
It really depends on what it is you are selling and who you are dealing with. Every place is different we had a local issue that had farmers selling grain and higher prices and then rolling out the lower contracts. Their was a large lawsuit that ensued and found that the farmers were in the wrong based on their contracts, but by the time it was resolved the elevator went broke and the farmers got ...
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What is you futures month you sold in and what is you futures price and your basis?
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Did this a couple years ago in 19 when everything flooded. I ended up buying the difference. Luckily prices had dipped tremendously from the time I contracted so I was actually able to make money on the deal. Doubtful I’d get that lucky twice. But one thing I’ve learned is when you take on a new piece of ground you know nothing about it’s good not to contract grain dependent on those bushels for a...
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Can you explain more about your dads advice on contracting over your break even price?
Usually the roll to the next crop year will depend on the Dec to Dec spread plus a fee for rolling 5-10c usually. Right now corn is gonna cost you about .25 on the spread if its beans your looking at a dime before fees. If you sold higher than current market prices the elevator will usually let you out or as others have said you can buy some bushels off a neighbor. Either way you just need to penc...
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Had one Mill manager tell me if you push hard enough they will let you out. His exact word "What can we do it's not like we can come and get bushels out of your bin that are not there. They will require you to show us your Insurance so we know that your not lieing but nothing they can do about being short." Saw it in 2008 the boys in Montana Durum hit 20 dollars and all of a sudden they didn't ...
Luck you only have to deal with 5,000
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Another option is to explain to a neighbour that you did a whoops ask if they will sell to you at market price I can bet they’ve been in the same spot
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I have bought from a private grain elevator in the past to cover extra contracts and won on both ends. Collect insurance on bushels short and buy grain under my contract price to cover. I usually market directly to end users that pay above the elevator price. I do some drying and storage with the private elevator to cultivate the relationship.
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If it's at a decent price see if your neighbor wants to sell some to cover it win both ways.
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Talk to who you booked it with. They’ll either let you roll it to next year or buy it out. Varies by who and how you booked it.
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With market low will they help me?
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You have to buy them back or rebook them at a discounted rate( usually .06 to .08 cents per bushel) for next year. Buy back will depend on futures pricing. Probably best to check out buy back price now.
That is how it works around here anyway. Hope this is helpful.
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