Being Prepared for the Unpredictable

As we look ahead to the 2024 crop year many decisions loom in the not-so-distant future. Federal Crop Insurance, especially MPCI policies, decisions must be made by September 30 for next seasons wheat crop. Coverage levels, unit structures, and whether to add SCO or ECO must be selected for the 2024 season prior to the September 30 deadline.

The projected price is currently in the discovery period, August 15th thru September 15th, and is averaging $7.37 as of Sept. 7th. Last season the projected price was a $8.79. Although the wheat price is not as favorable as last season, we have a great opportunity to provide good risk management solutions for the 2024 wheat crop.

With a 50-bushel APH at the current projected price an 80% RP policy would provide a revenue guarantee of $295 per acre. Adding SCO and/or ECO could add an additional $55 of coverage per acre. As with any risk management decision there are many factors that must be carefully considered. Producer Ag has highly trained Risk Management Specialist that can help navigate both your crop insurance and grain marketing as we begin the 2024 crop year.

Even though markets have had a pullback over the last few months, there are still opportunities to be had for 2024! With July 2024 wheat still hovering in the 7.20 futures range, combined with a significant drop in input prices. Profitability is still within range.

Producers have had many obstacles this year to overcome and planting next year’s wheat crop into dry conditions is one of them. However, we have planted into dry fields before and came out on the other side with a decent crop. Don’t let today keep you from success tomorrow! There is still a long road ahead for wheat with weather and geo-political issues overseas. Where we are at in the marketing year, wheat tends to be more of a follower unless we get more news on the Russia/Ukraine situation. We also have a quarterly stocks and small grains summary on September 30th that has historically been a market mover. Keep in sight where we are at historically profit and price wise and at least think about putting a floor in these markets at a level that works for your operation.

So, have a plan! Take some time to work with your Producer Ag Risk Management Specialist’s to review your APH, come up with a cost of production, and plug those numbers into a profit matrix to help you with your decision-making process. Stay flexible with your strategy but have a “worst case” built into your profit and set yourself up for success in 2024!