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© Roach Ag Marketing, Ltd.
Grain Price Outlook and Market Strategies
South Dakota Corn Growers Association
by John Roach
January 10, 2009
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
There will not be enough money to raise crops this big next year
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
World coarse grain ending stocks tight
U.S. ending stocks are tight
Exports off to slow start
Ethanol demand slowing
We still need a big corn crop every year
Price peak due in Mar – June in 2009
Corn Situation and Price Outlook
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
World soybean ending stocks not as tight as corn or wheat, but demand is solid.
US stocks very tight
Look for shrinking 2009 crop in S. America
Prices trying to trend higher
Bean Situation and Price Outlook
© Roach Ag Marketing, Ltd.
How Should I Market My Crops?
© Roach Ag Marketing, Ltd.
Chicago December Corn Futures, 1990-2005 average1-
Jan
1-Fe
b 1-M
ar
1-Apr
1-M
ay
1-Ju
n
1-Ju
l
1-Aug
1-Se
p
1-O
ct
1-N
ov
1-D
ec
230
235
240
245
250
255
260
265
approximate dates
cents
per
bus
hel
© Roach Ag Marketing, Ltd.
Chicago November Soybean Futures, 1990-2005 average1-
Jan
1-Fe
b
1-M
ar
1-Apr 1-
May
1-Ju
n
1-Ju
l
1-Aug 1-
Sep
1-O
ct
1-N
ov
570
575
580
585
590
595
600
605
610
approximate dates
cent
s pe
r bu
shel
© Roach Ag Marketing, Ltd.
•Focus the majority of sales in the 1st half of the year
•March through June is usually best
Rule # 1
© Roach Ag Marketing, Ltd.
•Sell only when markets are giving a Roach Ag Sell Signal
Rule # 2
© Roach Ag Marketing, Ltd.
December 2007 Corn
Both Lines Over 75 = Roach Ag Sell Signal
© Roach Ag Marketing, Ltd.
Roach Ag Sell SignalsYour Digital Thermometer For Prices
© Roach Ag Marketing, Ltd.
Roach Ag Sell SignalsWhen Both Lines Are Above 75 = Sell Signal
© Roach Ag Marketing, Ltd.
Roach Ag 2007 Corn Sell Signals56 Days of Sell Signals ($3.91) and 272 Days Without ($3.71)
© Roach Ag Marketing, Ltd.
•Figure out the percentage of bushels you are comfortable selling each and every spring and tie that % to the your crop insurance policy coverage level
Rule # 3
© Roach Ag Marketing, Ltd.
•Make sure you take into consideration what your cash-flow needs will be from harvest through February
Rule # 4
© Roach Ag Marketing, Ltd.
•Make sure you have enough owned storage to hold the undelivered percentage of a record crop
Rule # 5
© Roach Ag Marketing, Ltd.
•Split your old crop bushels and new crop contracts into between 3 and 5 increments and sell one increment of each on each Sell Signal
Rule # 6
© Roach Ag Marketing, Ltd.
•Buy new crop puts on the bushels you do not want to sell on a contract. Decide if puts are insurance or investment
Rule # 7
© Roach Ag Marketing, Ltd.
•If you see reasons for getting bullish, add additional increments by splitting the bushels again, but don’t quit selling peaks
Rule # 8
© Roach Ag Marketing, Ltd.
Put Opportunity - Buy Buy Puts on some of the Crop Puts on some of the Crop You Do Not Want to Sell You Do Not Want to Sell on a Cash Contracton a Cash Contract
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
© Roach Ag Marketing, Ltd.
Roach Ag Marketing, Ltd.
7601 N. Federal HwySuite 265-B
Boca Raton, FL 33487
800-622-7628
[email protected] http://www.roachag.com