Adopt a 'Three-speed' Marketing Plan for 2008 Wheat

摘要

Now that it's becoming more and more certain that the bull market in wheat may have peaked, it's time to look at beginning sales for 2008 because it's virtually certain there will be a significant increase in global acreage and it's highly unlikely we'll see another year where almost every major wheat exporting country encountered some yield-reducing weather problems in the same year! Last March we offered some three-speed marketing plans for corn and soybeans based on three possible weather scenarios for the 2007 growing season. Here is a similar approach to sizing up price potential for 2008-crop wheat under three different weather scenarios: Scenario 1: We have "normal" weather and a national average yield right in line with the "trendline" in national yields. Scenario 2: Weather is virtually ideal and the national average yield is above trendline yields (by about 3%). Scenario 3: Weather is adverse enough to pull the national average yields significantly below trend (by about 7%). Trouble is, that gives us three different forecasts for average prices, too. The purpose of this FOCUS report is to offer some guidance on how and when to "shift gears" in your marketing as the 2008-crop weather/yield/price outlook unfolds. We call it the "three-speed marketing plan."