Issue 23
Marketing Guide
1999

Prairie Grains is the official publication of the Minnesota Association of Wheat Growers, North Dakota Grain Growers Association, South Dakota Wheat, Inc. and the Minnesota Barley Growers Assocation.

Copyright Prairie
Grains Marketing Guide
Summer 1999

Prairie Shortcuts

Marketing plan: 10% outlook, 90% strategy

The two major components of a marketing plan, and the amount of emphasis each component should receive when developing your marketing plan, are: 1) Outlook, 10%; 2) Strategy, 90%.  Weather, acreage, and demand are the predominant factors that determine price outlook, and all three can be variable.  Thus, 90% of your market planning should concentrate on strategy. 

Develop a marketing plan based on the assumption of a normal growing season, with a backup plan in case a short crop develops.  Here's what you need to know to put a plan together:

• Grain available to market
• Available on-farm storage
• When you need money
• Tax ramifications (if any)
• Realistic price objective
• Break-even price
• Stay in business price (covers all  out-of-pocket expenses)

The next step is to map out a plan.  Define your selling season, setting price and time objectives for selling percentages of your production, and have a default date and quantity if your price target was not achieved.  The goals of your marketing plan are profitability and risk control.  View your marketing plan like a coach's game plan.  How many coaches wait until the 4th quarter to implement their game plan?

Excerpted from the Country Hedging booklet, "Price Risk: Developing a Marketing Plan and Marketing Tools Basics." For more information about the booklet (which is being updated) and Country Hedging market education programs during the off-season, contact the company at 800-243-3432, or contact your local Cenex Harvest States representative.

Winter wheat a production hedge for some

There's an element of risk management in the production practices and crops that producers choose.  For some grain producers, their production hedge is planting different crops, including winter wheat.  You can find updated varietal performance data for winter wheat at the NDSU Small Grains Page: http://www.ag.ndsu.nodak.edu/aginfo/smgrains/
smgrains.htm

U of M to offer Master Marketer Program next winter

The University of Minnesota Extension Service is planning "Master Marketer" programs at several western Minnesota locations next winter.  The first such program was held last winter in Mankato, with six days of intensive marketing training for grain producers experienced in marketing commodities and having some knowledge of futures and options. A key objective of the program is to help producers learn to sell their grain for higher prices, thus increasing their total farm revenue.

Subjects covered will be basic and advanced marketing strategies, financial planning and farm budgeting, developing and implementing a marketing plan, fundamental and technical analysis and starting and supporting successful marketing clubs. Expert instructors will come from the U of M Extension Service, other universities and private industry.  For further information, contact Edward Usset, U of M grain marketing specialist, at (612) 681-7999.