Plan Grain Sales, Estimate Expected Net Price

You can estimate expected net prices for wheat, corn, and soybeans for any given months in the future, helping to plan sales and estimate the profitability of storing grain, using the tables below. 

Wheat Sales in November - Futures as of 7/17/07, Bases 2006-07 Adjusted to Current

Calendar Month	Nearby Futures Month	Nearby MGE Futures	Hunter Nearby Basis	Hunter Expected Price	Storage Costs	Expected Net Price
		+	+	=	-	=
Aug	Sep	615	-57	558	--	558
Sep	Dec	629	-52	577	15.8	561
Oct	Dec	629	-51	578	20.2	558
Nov	Dec	629	-41	588	24.6	563
Dec	Mar	639	-46	593	29.0	564
Jan	Mar	639	-49	590	33.5	556
Feb	Mar	639	-42	597	38.0	559
Mar	May	637	-37	600	42.5	557
Apr	May	637	-37	600	47.1	553
May	Jul	600	-34	566	51.6	514

Futures as of 7/17/07, Bases 2006-07 Adjusted to Current - Consider using HTA for June Delivery when price objectives reached

Calendar Month	Nearby Futures Month	Nearby CBT Futures	Hunter Nearby Basis	Hunter Expected Price	Storage Costs	Expected Net Price
		+	+	=	-	=
Oct	Dec	871	-182	689	--	689
Nov	Dec	884	-180	704	21.1	683
Dec	Mar	884	-170	714	26.4	688
Jan	Mar	893	-160	733	31.8	701
Feb	Mar	893	-140	753	37.4	716
Mar	May	897	-120	777	43.1	734
Apr	May	897	-95	802	49.0	753
May	Jul	907	-75	832	55.1	777
Jun	Jul	907	-55	852	61.4	791

Soybean Storage Looks Profitable - Futures as of 7/17/07, Bases Current to Average by June Consider using HTA for June Delivery when price objectives reached

Calendar Month	Nearby Futures Month	Nearby CBT Futures	Hunter Nearby Basis	Hunter Expected Price	Storage Costs	Expected Net Price
		+	+	=	-	=
Oct	Dec	337	-75	262	--	262
Nov	Dec	337	-75	262	13.2	249
Dec	Mar	352	-70	282	15.4	267
Jan	Mar	352	-65	287	17.6	269
Feb	Mar	352	-64	288	20.0	268
Mar	May	362	-63	299	22.3	277
Apr	May	362	-49	313	24.7	288
May	Jul	372	-44	328	27.2	301
Jun	Jul	372	-35	337	29.9	307

Created by NDSU extension crops economist George Flaskerud, here’s how the charts work: In the first column, Calendar Month, pick months into the next year that are likely times in which you would sell grain, and thus would like to estimate the net price you might receive.

The Nearby Futures Month and the Nearby Futures price for each corresponding calendar month are entered in the next two columns.  In the Nearby Futures column, the settle price is entered using the closest futures month (Nearby Futures Month) to the Calendar Month in the first column. For August in the wheat example, that would be the Minneapolis September futures price on the day this chart was created, which was $6.15. Most daily newspapers publish the grain futures prices you would need to do your own sales planning charts.

In the fourth column is the Nearby Basis, which is the difference between the futures and your local cash price. Here, enter your local average basis for each calendar month listed in the first column. In the wheat example, the basis in August at Hunter, N.D. is 57 under. Your local elevator would know these numbers. You can use last year’s basis numbers, or averages from the last three or five years. (See more basis information, including links to online basis charts, on page 28).

The Nearby Futures number is added with the Nearby Basis number to calculate an Expected Price in the fifth column. Thus, for August in the wheat example, the Nearby Futures price of $6.15 plus the Nearby Basis of -57 equals an Expected Price of $5.58.

Next, subtract Storage Costs for each Calendar Month in the chart. There would be no storage cost if you sell off the combine. Use the Storage Cost estimates Flaskerud provides in these charts, estimates provided on page 30 your own storage cost estimates, or estimates from your local elevator, lender, or farm business management or extension educator.

The final calculations give the results in the final column of the chart, Expected Net Price.

Note that these are only estimates to help with sales planning. Other factors such as quality premiums/discounts and government support income are not included.