 In a world of electronic algorithm and high frequency traders, it is easy for us mouse clickers to feel left in the dust. Markets are able to respond to new information in milliseconds. “News” can be anything from a USDA report to a 280 character Tweet. Breaks and rallies on such news can last just seconds or less, and swings from one to the other can happen just as quickly. This makes having target orders in place in advance of these types of moves important to ensure that pricing objectives are met the instant the market can fulfill them.
The farmer’s time is invaluable. Especially as spring planting gets underway, a farmer’s attention is drawn in a variety of directions. Making sound marketing decisions in a volatile market place is just as important as choosing the right variety of seed, or fertilizer to apply. Being proactive in setting targets allows the farmer to set realistic pricing goals, and avoid emotional decisions in the heat of a rally, which may not last the length of a phone call.
This time of year often presents seasonal volatility, as trade will be sensitive to changes in weather as crops go in the ground. A “weather premium” is usually priced into the market to account for potential weather changes over the growing season. This often presents pricing opportunities for farmers.
MAC offers its customers the ability to place targets for cash contracts, forward cash contracts, hedge to arrive contracts, or pricing existing basis contracts. Contact your local MAC facility merchant today to implement a targeting strategy that fits the needs of your marketing plan.
|
Support is the contract low, 355. The market will be sensitive to USDA’s crop progress reports each Monday afternoon and weekend forecasts. No sales advised. Target 379.
