Home News Michigan Ag News Managing Risk in Soybeans, Grabbing Opportunities in Wheat

Managing Risk in Soybeans, Grabbing Opportunities in Wheat

wheat field

There has been a lot of volatility in the wheat market this week, and according to Rick Hollister of The Andersons, there hasn’t been a lot of big news to push the market either way.

“We’ve got the speculative crowd taking a swing at each other every other day between the winners and losers and trying to chop this thing—it’s been pretty violent in a short range,” he said.

With this turbulence, Hollister said this gives growers an opportunity to take advantage of some positive action.

“[This gives an opportunity] to grab those higher days like Monday and continue to lay that risk off to those speculators,” he said. “On those up days, know we’re going to get that turnaround Tuesday along the way too.”

On the soybean side, prices have been struggling against the $9 level for months. That ceiling was finally broken. It’s been since March 4 to see November soybeans with a better trade than they were on Wednesday.

“It looks like we’re trying to attack the highs that we traded in February—this was before the Planting Intentions report and the onset of COVID-19,” said Hollister. “The highs we traded November beans was between 925 and 930.”

This is presenting growers with an opportunity to think about how much risk they need to manage.

“This is as good as we’ve been able to do for many months in soybeans, so we’re encouraging guys to do an assessment of their bean crop and bring it back to their own business and see if this prices fits to the profit side or keeps them in the black,” he said. “We’ve got to do a little something to keep managing that risk.”

Hollister talks about the reported ranges of crop destruction in Iowa as well as a hot, dry weather forecast impacting the markets in his full comments in the player above.