September 2017

New grain bid comparison tool

The 2016-17 crop marketing year ended on August 31 with U.S. corn ending stocks at the largest in nearly 30 years and soybean stocks at levels not seen in 10 years. The 2016 U.S. corn and soybean crops were record large as Iowa averaged 203 bushels/acre for corn and 60.5 bushels/acre for soybeans. Despite the less than ideal 2017 growing conditions, the crops look close to average statewide and many old crop bushels remain unpriced in storage.

Storing corn and soybeans without a crop marketing plan has proven challenging once again. Most farmers already ran out of cash trying to store the 2016 crop, so they’ve already made their cash sales and are preparing for the 2017 harvest. Others took the risk with their extra 2016 bushels thinking that a late summer futures price rally would allow them to at least breakeven on bushels stored for nearly 10 months.

However, the selloff in futures prices in August combined with widening basis (local cash minus nearby futures) as harvest approaches provides limited opportunities for farmers with unpriced old crop bushels. This is especially true with bushels stored commercially with wider than normal basis likely to persist prior to and during the 2017 harvest. In addition, storage and interest costs could approach 50 cents per bushel over the past 10 months for unpriced old crop. That amount will still need to be subtracted to determine the final cash price received. Thus, a likely negative return to storage for those 2016 bushels that were finally marketed.

Very few cash sale strategies remain for old crop bushels without adding additional storage costs or futures price risk. Even co-mingling old and new crop corn bushels on-farm could be risky as quality issues have emerged with some of the 2016 crop. In addition, a crop insurance adjuster should measure grain bins for crop insurance purposes containing old crop bushels stored on-farm before adding new crop bushels. Procrastination in contacting your crop insurance agent to request a grain bin measurement could delay the adjuster and your start to the 2017 harvest.

However, with the 2017 yield variability across Iowa - and perhaps a harvest that might begin later than normal - regional basis differences have emerged. Some processors have narrowed old crop basis to assure a flow of bushels out of farmers’ hands before harvest. Once harvest gets underway, expect that basis to widen for much of October barring weather delays. Think about checking various processor cash bids in your region, especially if you have a semi-tractor available to deliver those bushels.

ISU Extension and Outreach has developed an easy way to compare various cash grain bids while reflecting your transportation costs. The "Grain Bid Price Comparison Tool", can be found on the ISU Ag Decision Maker website.

Simply collect up to eight cash grain bids from various locations and input these cash prices into the spreadsheet along with your own estimates of operating costs and distance to haul the grain or charges for commercial hauling. For new crop corn bushels, adjustments should be made for higher moisture content to adjust for drying and shrink discounts. This decision tool allows for comparing a variety of “what if” scenarios for selling grain at various cash prices while considering transportation costs. For more information on storage and marketing, visit the Ag Decision Maker website.

grain bid price comparison screenshot

Steven D. Johnson, farm and ag business management specialist, 515-957-5790,


Steven D. Johnson

farm & ag business management field specialist
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Use this decision tool to compare grain delivery to multiple buyer locations based on transportation costs, cash grain bids, and adjustments for moisture by delivery location