2016 Soybeans - $10.61
Soybeans responded in a way that were predictable. My biggest mistake with soybeans was being so conservative in trying to get sales made while my own analysis showed traders had not yet become optimistic. I made a couple recommendations to sell too early after prices had rallied a dollar off their contract lows. My final call was AT the top of the market when optimism had become excessively bullish. The average price for 2016 soybeans, had every recommendation been followed was $10.61, well above average which was around $9.88.
2016 Corn - $4.32
I prefer direct contracts with grain elevators as a primary marketing tool. Most years however, there will be "mistakes" where a brokerage account becomes necessary. Upon accepting the reality that the market had come and gone, but still modestly bullish, my next recommendation on June 24 was to add some revenue to the marketing year by selling puts on the remaining 75% of the corn you expected to grow. 80% of all options expire worthless, which is why I generally recommend not buying them. Selling puts is a bullish strategy you use if you believe prices will remain level or move higher. This strategy is not that risky most of the time, but this strategy turned out to be costly this time. Had you sold the puts when I recommended at .40 cents, you would have bought them back at expiration at .51. Instead of adding to the marketing results, it took 11 cents from the end results. This was mistake #3.
On August 30, I called the bottom in corn and recommended re-ownership on paper. This would turn out to be a day early, but within a penny of the bottom. Yes, I suppose this would be considered a Texas hedge. Although corn was at a bottom, the reality was there was going to be a very large corn crop, so the fundamentals were not there for corn to rally quickly. Because of this, I recommended a synthetic re-ownership of corn using oil. I recommended this synthetic re-ownership because to a greater or lesser extent, oil and corn tend to trend together. I recommended taking a long position in oil to mimic what would need to be done to gain .84 in corn..... enough to get the cash price back to $4.00. This would mean that oil would need to reach $50.50 which happened on October 10.
The average price for 216 corn, had every recommendation been followed was $4.32, again well above the average price which was around $3.67.
For those folks who have followed along this year, you know that my calls were made in real time. There have been no behind the back alterations or modifications made here. I prefer to be as transparent as I can be, pointing out my mistakes as I went. Its why I include links to posts I made at those times.
Those who know me know that I do not subscribe to other marketing agencies. My work is completely unique. I do not follow the herd on any recommendations, so I will not blame my failures and mistakes on consensus. (Well, everybody got that wrong.....Nobody saw that coming)
I have already sold 10% of the 2017 soybean crop with a 10% sale at $10.05 on June 8. Just Friday, the 2017 Nov soybean contract broke out above this level and is making new highs. Don't be left behind!