Market Update in Preparation for Planting

As the new year gets underway and preparation for planting season begins, having a trusted partner and resource is prudent in the development and execution of a 2018 marketing program for your operation.

According to Advance Trading Inc. (ATI), crop insurance is an integral part of a comprehensive production plan, but it should be incorporated in conjunction with a risk management strategy that provides market flexibility. Since February is the established price projection time period for 2018 corn and soybean crop insurance, be sure to consult with your Big River manager or merchandiser for the proper risk management strategy for your operation.

ATI has provided the initial insights into crop insurance price projections for the month of February with corn being forecasted to be the average of December 2017 corn futures, while the average of November 2017 soybean futures will generate the projected price for beans. December corn numbers could be near where they were in 2017, while November soybeans could be slightly lower. There could be much change, however, over the next several weeks considering the crops in South America are at a critical point and the weather is uncertain.

It’s also important to note that corn and soybean projected prices have been trending lower in recent years as yields recovered following the 2012 drought. Since 2013, the national U.S. corn average corn yield has increased 11.7 percent while the national average soybean yield has risen 11.2 percent.

Other current market news provided by ATI can be found below and is important to take into consideration when developing and executing your marketing plan.

  • USDA at its annual Agricultural Outlook Forum on Feb. 22–23 will release updated U.S. balance sheets for 2018/19.
  • A few well-respected sources think the USDA will need to lower its Brazilian corn forecast in the coming months.
  • Recently there has been selling pressure for soybeans from Brazilian producers.

To continue strategizing the proper market program for your operation and learning how Big River can service your needs, please contact your local Big River elevator.

 

SOURCE: ADVANCE TRADING INC., FEBRUARY 2018; www.advance-trading.com.

Holly Barthol

New Addition to the Management Trainee Team

Over the last year, Big River Rice & Grain has pioneered a year-long management training program with the intent of identifying and developing young talent into professionals that will be invested in the future leadership of Big River. During the program, management trainees are exposed to both the operational and commercial sides of the business, and at the conclusion they are evaluated and placed in a position that utilizes their strengths.

Two trainees, Romeo Stalling and Ben Gallant, have already successfully completed different segments of the program, including extensive merchandising content. In the beginning of January, Holly Barthol, the newest member of the management trainee team, was welcomed. Just like her fellow management trainees, she too has successfully completed the merchandising coursework.

Even though, Holly Barthol is the newest member of Big River’s management trainee team, she is not new to Big River agriculture. Barthol has been working for Big River for almost two years as a grain accountant in the Parkdale location. In addition to her experience at Big River, Barthol is married to a former agricultural producer on the Arkansas/Louisiana border. With an educational background in biology, Barthol has instinctively taken to the agriculture industry, which explains her natural fit into the management trainee program. The current executive leadership of Big River encouraged Barthol to join the program as they saw her demonstrate her ability to positively communicate with producers, passion to learn, and humility to take initiative within the workplace daily. Barthol has enjoyed the new experience so far, saying, “Big River wants you to be well-prepared and have a flexible skill set to fill a role where there is a need. The management trainee program is hard work, but enjoyable work.”

As Barthol continues in the management trainee program, she is committed to using her understanding to serve the needs of the Big River community. To learn more about the management trainee program and what Big River can do for you, visit our website and locations: http://bigriverriceandgrain.com.

Young soybeans growing in field

Upcoming Grower Engagement Meetings

Big River Rice & Grain will be hosting our annual Grower Engagement meetings this year on February 20 and 21. Advance Trading will be discussing the market environment, along with BRRG commercial personnel. Question and answer sessions will also take place after the presentations. A meal will be provided at each of the meetings.

Details on location and time are listed below:

When: February 20, 2018; 11 a.m.–1 p.m.
Where: Louisiana Cotton Museum, 7162 Hwy. 65 North, Lake Providence, LA 71254

When: February 20, 2018; 4 a.m.–6 p.m.
Where: Poverty Point State Park Conference Room, 1500 Poverty Point Pkwy., Delhi, LA 71232

When: February 21, 2018; 11 a.m.–1 p.m.
Where: Parkdale Facility, 2159 Hwy. 165 South, Parkdale, AR 71661

For more information, please contact your local Big River facility.

 

Big River Management Change at Parkdale Location

Big River Rice and Grain is announcing a managerial change at the Parkdale location. Justin Johnson will now be the facility manager for the Parkdale site. Johnson formerly oversaw the Monticello facility but will now be transitioning into the day-to-day operations at Parkdale. Management trainee Romeo Stalling will be handling the Monticello facility as Johnson shifts into his new role at Parkdale.

Justin has served as an elevator manager in multiple locations since his original employment with Bayou Grain in 2003. He worked at Eudora, Arkansas, and then at Monticello, Louisiana. Justin has done an exceptional job of adapting to new situations and performing the duties required to be an effective manager. He is an asset to Big River, and we are looking forward to continued success as he adapts to this new challenge.

For the full list of Big River facility locations and their managers, visit http://bigriverriceandgrain.com/locations/.

Line graph

Market Update October 2017

The monthly October USDA report surprised the market with a 2.1 BPA higher yield for the U.S. national average than what analysts were estimating. According to Advance Trading Inc., there is an adage in the grain trading industry that a “big crop gets bigger.” The same however, did not ring true for soybeans as the yield came in less than expected at 49.5 BPA vs. 49.8 BPA estimated and 49.9 BPA in the September report — which rallied SX17 futures 27 cents and left the industry wondering what the USDA would do in the November report as harvest really has just begun to heavily progress across the Midwest.

ATI suggests that uncertainty within the market can be turned into opportunity by implementing a disciplined risk management strategy. Other current market news provided by ATI can be found below and is important to take into consideration when strategizing to combat an uncertain market.

  • Trust the market: prices are cheap right now during harvest relatively speaking and the CME is paying farmers to carry most commodities to a later date. For example, CZ17/CN18 spread is at a 29c carry and SX17/SN18 is at a 37c carry — futures are telling us they want the commodity “tomorrow” but that doesn’t mean prices can’t go lower yet! Use storage, but don’t forget that the USDA and even world balance sheets are telling us there are plenty of corn, beans, and wheat to go around this year.
  • Rice harvest in the U.S. is 91 percent complete.
  • Rice futures prices are expected to remain sensitive to potential developments that surface from the ongoing NAFTA discussions in Washington, D.C.
  • Through Oct. 13, the 2017 crop insurance harvest price for December 2017 corn futures has averaged $3.4953.
  • Through Oct. 13, the 2017 crop insurance harvest price for November 2017 soybean futures has averaged $9.7015.
  • Mid-October corn export sales are coming in strong, but many experts believe the USDA is overshooting exports as the U.S. continues to remain uncompetitive compared to South America and the large corn crop we saw grown down there this past year.
  • Mid-October soybean export sales show increasing demand with China being the biggest buyer, and hopefully this demand continues to ramp up into winter.
  • Weather indicates that mid-October will be a huge harvest week for the Midwest region in corn & soybeans as we are currently 28 percent harvested on corn (47 percent average at this time) and 49 percent harvested on soybeans (60 percent average).
  • Barge freight was high due to hurricane issues, soybean harvest, and low water levels but has since become stable with plenty of barges in the system. This is what drove basis down early this marketing year and again has since stabilized.
  • Soybean market strength is timely for producers with peak harvest expected. South America is expected to grow another large soybean and potentially corn crop that they are planting now, so despite lower prices, continue to take advantage of rallies and low volatility (options are cheaper than most year) to manage your portfolio.

ATI further explains with the market continuing to shift and with a larger 2017-18 corn/bean crop, this type of uncertainty could make it very challenging for producers to succeed without a risk management plan in place.

Having a trusted partner and resource can help you create and implement your strategy for your operation. Be sure to stay in touch with your Big River manager or merchandiser as the market continues to unfold.

 

SOURCE: ADVANCE TRADING INC., October 2017; www.advance-trading.com.

Lake Providence Operations

Two Management Trainees Join the Big River Team

Earlier this year, Big River Rice & Grain took new steps to invest in the future leadership of the company by hiring two management trainees. This program is designed to identify and capture young talent with the intent that they will be developed into professionals with long-term positions in the marketplace. Big River Vice President of Merchandising Justin Towery states, “The goal of this program is to expose a trainee to the operational and commercial side of the business. After one year of training, they will be evaluated and offered a job where their strengths are.” During that one year of on-the-job experience, a trainee will gain personalized training in our Agspring corporate office located in Leawood, Kansas. Also, they will gain exposure to logistics, trading, futures, options, contracts, creating markets for producers, the day-to-day management operations at several elevators and producer interaction.

In April 2017, the first management trainee, Romeo Stalling, joined the Big River team. Stalling is homegrown Oak Grove native who has obtained a bachelor’s degree in business administration from Louisiana Tech University. Stalling began his experience gaining exposure to the operational side of the business by working at several locations including Pioneer, Lake Providence and Eudora.

In July 2017, Ben Gallant joined Stalling in the program to become Big River’s second management trainee. Gallant graduated from the University of South Florida with a bachelor’s degree in physics and most recently has had experience in teaching. Gallant began by gaining exposure to the commercial side of the business in the Pioneer corporate office. Stalling and Gallant will eventually trade places to learn the skills the other has already gained.

Big River is committed to equipping young leaders with the skills necessary to continue to grow valued relationships, provide efficient operations and serve the community. To learn more about the management trainee program and what Big River can do for you, visit our website and locations: http://bigriverriceandgrain.com.

Grain barges in a shallow river

Minimal Rainfall Impacts River Dynamics During Big River Harvest Season

During the last three weeks, the Big River Rice & Grain service area has experienced minimal rainfall forcing the dynamics on the Mississippi River to slow down. Normally, barges can travel throughout the river with a load size and speed that are both efficient and cost-effective. Due to the low water levels, barges have been forced to reduce the amount of grain they transport by one-third. The smaller load sizes combined with slower travel times and a reduced number of total barges transporting grain have forced the price of transportation to quadruple.

This unexpected circumstance increases the risk for producers due to the potential for higher expenses, lost time out in the field harvesting, and not being able to store or sell product that is harvested. Big River used this as an opportunity to provide service to producers by creating merchandising strategies that minimized the pricing risk, by keeping wait times short and dump times fast, and by storing and piling extra grain so that it could get out of the fields and into a marketable positon. Justin Towery, Vice President of Merchandising, said, “We were willing to take on the risk for producers and to provide a way for them to get their crop out of the field. Because of our unique network of facilities, we were able to accommodate producers where some competitors were not, and we hope that brings value to our relationships.”

Towery forecasts the river levels to return to their normal state within the next seven to ten days, although it is possible that Big River and its area producers will be feeling the effects of the river dynamics until the end of the year. During this time, Big River will continue to provide risk-minimizing, cost-effective and efficient service to our producers.

To learn more about the service Big River provides and what we can do for you, visit our website and locations: http://bigriverriceandgrain.com.

Close up of soybean plants in field

Price Volatility and Harvest Preparation

Preparing for Price Volatility. Corn increases as there is still uncertainty about near-term weather patterns. According to Advance Trading Inc. (ATI), an effective risk management plan will only execute in this environment if a plan is mapped out well in advance. The company provides a recent analysis of the market and how this can create a challenge for producers without a plan in place:

  • December 2017 corn futures fell sharply to $3.74 on June 23 (its lowest price since September 30) and have since climbed back above $4.00.
  • Strength in corn comes as surprise with reports by the USDA Gran Stocks indicating inventories were 100 million bushels above the average trade estimate as of June 1.
  • November 2017 soybean futures have experienced an even stronger recovery, sliding to $9.07 on June 23 (the lowest price since Aug. 2) before rebounding to trade above $10.00 this week.
  • Soybean plantings of 89.5 million were below the average trade estimate of 89.9.
  • Forecasters are suggesting a warmer and drier pattern may soon affect more of the Midwest just as the critical pollination period for corn gains momentum.
  • Widespread rainfall projected for Midwest growing areas over the next week helped fuel selling interest.
  • A slight shift in the weather could result in a several bushel swing in the national average yield of corn and soybeans.

ATI further explains with the market continuing to shift, this type of price volatility could make it very challenging for producers to succeed without a risk management plan in place. The solution? Every decision should be made before marketing volatility takes place and put in place efforts to create a risk management plan.

Having a trusted partner and resource can help implement your strategy for your operation. Be sure to stay in touch with your Big River manager or merchandiser as this market year unfolds.

Harvest Preparation. Big River continues to provide producers with reliable services they depend on to succeed. Senior VP of Operations Steve Henderson states, “This starts with our intensive preventative maintenance program at all facilities with actions such as turning or replacing spouting, reworking transitions and improving safety.”

In addition, Henderson mentions Big River uses thermal imaging to diagnose issues in advance and enhance the quality and safety of the environment. This ensures delivering efficient operations and services for growers.

To learn more about the preventative maintenance program, Big River and what we can do for you, visit our website and locations: http://bigriverriceandgrain.com.

 

* PRICE VOLATILITY SOURCE: ADVANCE TRADING INC., July 2017 www.advance-trading.com 

Big River Rice & Grain Welcome New Lake Providence Manager

Matt Muse

Matt Muse, Lake Providence Facility Manager, Big River Rice and Grain

Big River Rice and Grain welcomes Matt Muse to the team as the new Lake Providence facility manager. Muse will use his deep understanding of the industry as a former producer to serve the needs of the Lake Providence community.

In 2012, Muse graduated from the University of Louisiana at Monroe with a degree in aviation management. Muse soon discovered that the airplane world wasn’t for him, so he returned to his roots, the Lake Providence community, where his family has farmed for two generations. Big River recognized Muse as someone who understands the business and respects the people who know the region best. He’s a valuable asset to the team and community.

“Matt is well-known, well-liked and well-trusted in the community. He just has a great, outgoing personality,” said Steve Henderson, Big River Rice and Grain’s VP of operations. Henderson also has a strong confidence in Muse’s decision-making skills. “He has been a producer himself and that experience has forced him to know how to make tough decisions.”

For the full list of Big River facility locations and their managers, visit http://bigriverriceandgrain.com/locations.

 

Soybean Export Warning

As many of our producers have no doubt heard or read in trade news, the country’s largest grain handlers have declared they will reject deliveries of Monsanto’s Roundup Ready 2 Xtend soybeans due to a lack of approval from the European Union.

While Monsanto has stated that it expects EU approval very soon, Big River Rice & Grain will not accept Xtend soybeans at this time since the majority of our region’s crop is sent overseas.

The U.S. Soybean Export Council and American Soybean Association have both publicly indicated that Monsanto is working on a plan for domestic use of this crop, so we advise you work with your local seed vendor for the latest information if you have chosen to grow Xtend soybeans this season.

 

Big River Rice & Grain Hosts Community 5K Race to Donate to the JDRF

5K_LogoOn Saturday, May 7, more than 120 runners gathered at Poverty Point State Park in Delhi, Louisina, to participate in the second annual Big River Rice & Grain 5K Race. The event, which also included a one-mile fun run, raised $5,000 for the Juvenile Diabetes Research Foundation (JDRF).

“Hosting events like the 5K race that involve the community are important because our producers and our customers are also our friends,”  said Jeremy Raley, Big River Rice & Grain’s director of merchandising. “The majority of Big River employees were born and raised in northeast Louisiana, and now continue to live here. Therefore, it is Big River’s responsibility to help our community and give back to a cause that personally affects our customers and friends.”

Raley and the rest of the Big River team decided to donate this year’s proceeds to the Juvenile Diabetes Research Foundation (JDRF) because of the personal connection the juvenile diabetes cause has to the community: one of Big River’s customers’ son is a seven-year-old boy with diabetes who is heavily involved with JDRF.

“There are so many people in the Big River community who have diabetes or know someone that has it,” said Raley. “Big River is honored to have helped raise awareness for a good cause.”