Large parts of the Australian grain belt have received significant rainfall in the past month. How handy that would have been for crops two or three months ago!
Alas grain growers can't control the weather; nonetheless Australian growers have become very good at maximising their crop production on the weather they receive.
Grain prices should be thought of in much the same way as the weather.
There is generally some seasonality to them, however prices are largely uncertain from one year to the next and within a season, just like rainfall.
The aim should be to maximise the grain prices available by focusing on what you can control in the same way that you maximise your total production from your rainfall.
There is not much point achieving a 6 tonne to the hectare crop if your average across the farm is 1.5 tonnes to the hectare. The aim is to get your average yield up across your operation.
There are plenty of controllables growers can use to influence their average price across their farming operation.
This includes selling principles such as understanding what your grain is worth in international markets and considering price spreads when selling.
Traditionally premiums for better grades, and discounts for lower grades, of both wheat and barley, are widest around the harvest months and narrow through the grain selling year.
These trends can assist with your approach to selling and help to achieve a better average price across your entire crop.
For example, if you have higher protein milling wheat or malt barley, it may be worth engaging the market and offering these grades for sale.
That way all buyers can see your grain and try to buy it when in demand, and you may find it trades at prices higher than bids.
If you have feed or off-spec grades that you're thinking of holding, you could offer these at smaller discounts to the premium grades.
There are so many grades of grain in Australia this year. A dryer growing season, a harsh finish, and now a wet harvest in many areas is impacting grain quality.
It can make determining the value of these grades more difficult. Growers can't find prices and buyers are trying to determine how they fit into their accumulation strategy.
One of the simplest controllables for growers to implement is to offer their grain for sale at a price rather than accepting published bids as the market.
How do you know what your grain is worth if you don't ask every buyer? Offer!
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