With over 14 years of grain marketing experience behind us, the Grainwise grain marketing team have seen it all. We’ve been in the industry through the highest of highs, particularly the recent high grain prices, following years of drought, and we’ve also experienced together with our clients the lowest of lows.
Nobody, not a grain grower, a grain buyer, or a grain marketing expert wants to see or experience bad times. So, we have put together a list of the most common grain marketing mistakes to avoid, in order to reap the most from your grain, and operate efficiently and profitably within todays grain market.
Why are successful grain marketing strategies paramount?
Effective grain marketing, which includes grain market strategies and planning are essential to grain growers. As grain marketing is the process of converting grain into money, without an effective and realistic plan to make this happen, new crops can’t be sewn, and grain growers are left without any cash flow to maintain their farming operations.
For some, the concept of grain marketing can be complex, as involves a series of decisions, and the development of strategies, in order to achieve the successful outcome of a strong grain price. The grain marketing process is something that is learned, and something that required the ability to accurately read data, trends and analyse multiple variants in order to make sound decisions based upon facts, rather than just jumping in on a whim.
Grain marketing is a tough skill to master, which is why in more recent times it has become even more common for grain growers to engage the services of experienced and dedicated grain marketing teams, such as the team at Grainwise, to assist with the process, and thus freeing up time to concentrate on what grain growers do best… grow grain!
Top 4 grain marketing mistakes to avoid
Whilst many grain growers are enlisting the help of experts, with the right advice, it is possible to avoid some of the more common grain marketing mistakes, such as the 4 mentioned below.
The first mistake that we see all too often is grain growers not selling their grain, when the market is fluctuating, rising, and falling, because the rise and fall nature of the market unsettles them. Whilst it is always great to sell in a stable market, it is possible to conquer fears and emotions and sell in a market that is fluctuating, selling at a price that the grower is comfortable with and leaves them with a profit.
Not taking advantage of futures contracts
The second most common mistake we see in terms of grain marketing is not taking advantage of futures contracts.
As is suggested by the title, a futures contract in terms of grain marketing is a contract that looks to the future and enables a grain grower to sell to a buyer before it has been harvested. Futures contracts have many positives that should not be discounted such as, grain growers having the ability to lock in a solid price when the market is operating at a high, rather than risking it and waiting until the harvest season to see what the price is at that time.
Whilst it is always important to exercise caution when considering futures contracts, particularly in the harsh Australian climate where drought is common, futures contracts can be a fantastic grain marketing tool for your business and are certainly something that growers should not be afraid to utilise to increase their profitability. See how Grainwise can help with contract management.
Selling due to financial need
Selling when funds are tight, and money is needed for operational and other costs is another huge mistake when it comes to grain marketing. A lot of growers are tempted to sell on a cash needs basis, so generally in the periods of the off-season, in February or march, where cash flow is reduced. This however is also where grain prices tend to be at their lowest, so growers are losing out, selling quality product at a price that is certainly not the best possible.
Part of an effective grain marketing strategy is planning. Planning for the times where cash flow is needed and having an effective strategy in place to ensure cash is there without selling grain not at an optimal price is essential.
Selling due to inadequate storage
Not having adequate storage is a certainly an issue when it comes to grain marketing, however this is a common mistake that can be easily alleviated by increasing storage facilities or engaging the services of an experienced grain marketing team, such as the team at Grainwise who can assist with all grain logistics, making the grain harvest process easy and far less stressful, enabling you to focus on what you do best, grow grain!
How Grainwise can help
The team at Grainwise have over 14 years’ experience in Grain marketing. We have provided our list of common grain marketing mistakes to avoid in order to raise awareness of common issues and assist our growers to navigate through the grain marketing process, achieving the best results possible.
Growing quality grain takes a lot of work and we understand that time is precious, particularly for grain producers, which is why we offer a comprehensive grain marketing service, assisting grain producers to obtain the best rates and maintain high levels of profitability for their grain harvest.
Avoiding grain marketing mistakes, such as those described above will ensure that you are well equipped to make sound and positive grain marketing decisions, that ensure the longevity of your grain operations, and farming future.
If you would like to hear more about our grain marketing services, please contact us today!