Canola Marketing Idol

[crusher]

Texas hedge: will $300 Nov hold or will farmer selling start to kick the legs out? Texas hedge at $270 would have been better (or do you have 100 tonnes of that too!)
Those that have to price out July contracts this week might be a little stressed.

[IAMTHEMOLE]

UNTIL NOV 05 SOYBEANS ARE SOLIDLY CLOSED UNDER $7/BU FOR A COUPLE OF SESSIONS, $300/MT NOV05 CANOLA WILL HOLD ON A CLOSING BASIS. THATS MY STORY AND I'M STICKING TO IT.

[IAMTHEMOLE]

BLAME IT ON TEXAS. COVERED SHORT AT CLOSE . 285/MT. -$1650

[crusher]

I figure it is cheaper to buy canola than to spray Rovral so I bought in at $291 today. Once you get past today, there is not any rain in the US eastern corn belt for another week.

[charliep]

Time to lick my wounds/sell some more.

Sold 20 tonnes @ $299/tonne or a sale return of $5,980.

Results

June 20 - Sold 30 tonnes for $9654

July 6 - Sold 20 tonnes for $5,950

Total sales - $15,634 or an average price of $312.68/tonne.

[JD4ME]

50 percent sold huh?? are you wondering about those tropical storms/hurricanes pathes too? as I am. They could flip this market down quick if they hit on the louisiana coast and head straight north .
Always interesting.
http://wxmaps.org/pix/prec1.html

[JD4ME]

That said and looking at the overnight with beans up close to 10 cents again,it may be alittle to far south. Maybe this will be the thing that gets rust happening in the gulf states.

[charliep]

Am away for two weeks so need to do something. I am going to put in some grain pricing orders for while I am away.

Sell 20 tonnes at $299/tonne.

Sell additional 20 tonnes at $310/tonne.

Futures must close above to trigger sales. Will be back to review on July 25.

Farmers_son - you have good potential to be right on your strategy. What is always interesting to me is to look at the results/review what should have been done differently realizing you only had some of the information at the time of the sale.

[farmers_son]

Just curious...What would I have done differently if I had more information?

Seems to me I had all the information I needed to make the decision.

[charliep]

GPO hit. - Sold 20 tonnes @ $299/tonne or a sale return of $5,980 on July 13. Going to leave the last 30 tonnes unpriced the moment (pulling the other GPO).

Results

June 20 - Sold 30 tonnes for $9654

July 6 - Sold 20 tonnes for $5,980

July 13 - Sold 20 tonnes for $5,980

Total sales - $21,614 or an average price of $308.77/tonne.

Farmers_son - I agree with what you are saying. What is interesting to me is looking at how people approach a marketing decision like this and learning from them. This is the most interesting part of Lee in particular and me sometimes in the work with marketing clubs and marketing courses.

[TOM4CWB]

Charlie,

RISK.

Is pricing canola going to put my farm at a larger financial risk... than going unpriced if production doesn't come through.

Simply amazing... east central AB, frost the 25th of July 2005 was the farmers complaint... in the JD store when I weas picking up swather parts today.

Provost got quite a bit, from rumors I heard.

Now... what is the production risk... with a possible US iffy bean harvest... smoked canola by either being burnt up (34deg.C yest.) or frosted?

Who bought calls to cover the risk? At what cost? Our 320 calls cost $6.80/t.

Now the cost of the hedge goes up.

So does the guy who does nothing do better or worse?

No doubt a plan will give a more consistant income level.... smooth out the humps and bumps... (Bad for CASIP?)

but what is the 10 year average pre-hedger gain over a cash seller?