The CME and Total Farm Marketing Offices will be closed Friday, June 19, in Observance of Juneteenth

Feed Buyers Take Notice

What’s Happened…

The recent sell–off in grain and oil seed prices is providing a long-term opportunity for end users to lock in feed needs. December corn futures peaked at over $5.06 on May 15 and has since lost 14% with the recent low established under $4.35. This percentage change is historically somewhat normal from a market high to a low during the spring/early summer window. This data has been collected over the last 20 years. Bearish traders will argue the trend is down and prices still have more room to lose, compared to the low last year established at $4.93 in August 2025. It is important to remember that it is only mid-June. The next 60 to 75 days are the most important of the year to determine this year’s crop size.

Why this is Important…

Highly–rated crops and adequate weather in early summer have allowed this year’s crop to get off to a good start. Timely rainfall in recent years has made for big crops and a relatively reliable comfort zone for end users to be patient on purchases. While that might be the case again this year, there’s no guarantee. A trade deal with China could suggest strong buying in early summer with prices at an attractive level. Farmer sales are likely to be minimal at current prices. In fact, many farmers likely sold ahead when corn breached $5. This probably means they will store what was not sold. Additionally, weather (the most dominant factor determining crop size and, therefore, price) can change mindsets quickly. Bears could go to bulls practically overnight. The bottom line is for buyers not to be too comfortable at current prices levels. Be prepared to take advantage of opportunities the market has recently presented.

What can you do about it?

Acknowledge the reality that prices, while they might work lower, likely have a limited downside. There is plenty of time for prices to rally. This means pre-planning and preparing in case weather during July and August is adversely impactful to crop production. Managed money (large speculators) tend to buy aggressively, especially if impactful weather conditions occur.  

Getting ahead of this by using fixed risk call options is a strategy that will quantify risk with a known premium. Cash is not locked in, meaning you can benefit if prices work lower. The calls establish a futures price ceiling. Other strategies include a stair-step cash buying program. With corn prices down 14%, consider beginning to buy. As an example, buy 15% of your yearly corn needs and an additional 10% each dime lower. You’ll begin building a long position, lowering your average price on each purchase. A combination of cash buying and call purchases may work well for many. If you prefer, you can use long futures strategies as well. Keep in mind, unless stop orders are used, long futures risk is considered unlimited.

Find out what works for you… 

Work with a professional to find the strategy or strategies that are best suited for your operation. Communication is important. Ask critical questions and garner a full comprehension of consequences and potential rewards before executing. The idea is to make good decisions for the operation and less emotionally–charged responses to market moves, which are always dynamic.   

About the Author: With the wisdom of over 36 years at Total Farm Marketing and following across the Grain Belt, Bryan Doherty is deeply passionate about his clients, their success, and long-term, fruitful relationships. As a senior market advisor and vice president of Brokerage Solutions, Doherty lives and breathes farm marketing. He has an in-depth understanding of the markets and marketing tools, an excellent listener, and communicates with intent and clarity to ensure clients are comfortable with their decisions. 

The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Individuals acting on this information are responsible for their own actions. Commodity trading may not be suitable for all recipients of this report. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Examples of seasonal price moves or extreme market conditions are not meant to imply that such moves or conditions are common occurrences or likely to occur. Futures prices have already factored in the seasonal aspects of supply and demand. No representation is being made that scenario planning, strategy or discipline will guarantee success or profits. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing. Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services, LLC is an insurance agency and an equal opportunity provider. Stewart-Peterson Inc. is a publishing company. A customer may have relationships with all three companies. SP Risk Services LLC and Stewart-Peterson Inc. are wholly owned by Stewart-Peterson Group Inc. unless otherwise noted, services referenced are services of Stewart-Peterson Group Inc. Presented for solicitation.

Author

Bryan Doherty