What is in this article?:
- When should wheat be sold?
- Ending stocks
When to sell wheat may depend on the amount of price risks a producer can take.
In 1992, my wife and I bought a lot to build our dream home on. The lot had several pecan trees that needed shaped and trimmed. I called Dr. Glenn 'Cat' Taylor, (pecan tree specialist) and asked, “Cat, when should I cut the limbs off these trees?”
It was August, hot and dry. Cat said, “What are you doing this afternoon? Now is as good a time as any.”
Wheat producers are asking, “Kim, when should I sell my wheat?” My answer is: “Now is about as good a time as any.” Or you may sell wheat like I pruned the pecan tree. The limbs were removed when I had the time, and it took several months. Those trees now are tall and majestic. If I made any mistakes, nature covered them up. The markets should do the same for you.
For Oklahoma and the Texas Panhandle, the six-year average (June 2008 through May 2013) price is $6.48. The six-year average June price is $6.48. For the last six years, August, September, October, and November prices have averaged (after adjusting for storage and interest) $6.50. The six-year price spread for the monthly average August through November prices is six cents. This implies that, on the average, selling anytime in June, August, September, October, or November would have netted about the same average price.
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The U.S. supply and demand situation is nearly the same as in 2013/14. Hard red winter wheat stocks are projected to be about 45 percent, and U.S. wheat ending stocks are projected to be 24 percent below the six-year average. During the 2014/15 marketing year, U.S. ending stocks are not projected to change much from the 2013/14 situation.