Producers have been asking when to sell their remaining 2012 harvested wheat. The wise crack answer is July 20, 2012. Getting serious, the answer is: “When do you want to have all of your wheat sold?” Once that date is set, sell the wheat in three increments between now and that specified date.

Hindsight is nearly always 20/20. If prices could have been know with certainty, Oklahoma and Texas Panhandle wheat would have been sold on July 20, 2012 for about $9 per bushel. Wheat prices had increased from $6 on June 1 to $9 on July 20, 2012.

Wheat producers had less than two market days to sell at $9. By August 2, wheat prices were near $8.25 and remained between $8.50 and $8.00 until mid-December. At this writing, cash wheat prices are near $7.15 in most of Oklahoma and below $7 in the Texas Panhandle.

If the wheat had been sold on February 28, 2013, the cash price would have been about $7.20. After subtracting nine months commercial storage ($0.36), the net price would be $6.84. The June 20, 2012, Oklahoma and Texas Panhandle cash wheat price was about $6.53. Selling wheat on February 28 was still better than having sold wheat on June 20.

Between June 1, 2012 and February 28, 2013, Oklahoma and Texas Panhandle wheat prices have averaged about $8. This implies that if one bushel of wheat had been sold every market day since June 1, the average price would have been $8. After subtracting commercial storage costs, the average price is about $7.82 ($8 – $18 cents; 4 cents/mo for 9 months storage divided by 2).

If 2012 harvested wheat had been sold one-third on June 20, one-third on October 15, and the final third on November 15, the average price after storage would have been about $7.56. If all the wheat had been sold any day between October 15 and December 15, the net price would have been about $8 (plus or minus about 25 cents).

To recap, the net prices after storage are: June 20 - $6.53; July 20 - $9; thirds - $7.56; October through December - $8; one bushel every day from June 1 through February 28 - $7.82: Late February - $6.84. These figures show a $2.47 range from the low price to the high price.

The impression that producers who still own 2012 harvested wheat tend to give is that they feel “stupid” for not having sold the wheat yet. If the hard red winter area had not recently received moisture, wheat prices could be in the $8.50 range and producers holding wheat would feel much better about prices.

The above evaluation of the marketing alternatives indicates that the current price ($6.84) is still better than the price of wheat sold at harvest. Also, many of these producers sold most of their wheat in the $8.50 range. Their average price is still relatively good.

Lessons to learn are that wheat prices cannot be predicted. Selling all wheat at one time nearly guarantees that you will not receive the highest price, and spreading sales over time tends to produce an average price. Average prices tend to smooth out the financial bumps.