Harvest has come to a close in the Midwest, with corn being sold off the combine and stored in farmer bins. As year-end bills approach, farmers face the decision of whether to sell corn from the bin or hold onto it. Over the past month, corn futures prices have been relatively stable within a 20¢ range, supported by strong ethanol and export demand but constrained by the large carryout.

From a Marketing Perspective

With the end of the year in sight, farmers are now concentrating on their finances and planning for the 2025 crop year. The question remains: will corn prices break out of the modest trading range? Some farmers may be tempted to sell corn to pay their bills, while others hope for higher prices due to potential weather issues in South America. Here are three strategies to consider:

1. Basis Contract

If you plan to store corn at home, pay attention to your local basis levels. In some Midwest locations, the basis may be attractive as grain elevators try to secure as much corn as possible. Consider entering into a cash basis contract to protect the local basis level. By doing so, you commit to delivering a set number of bushels to the elevator with the basis locked in. However, the grain is not fully priced yet, and you need to determine the right time to finalize the contract based on your target futures price. Make sure to inquire about any associated fees.

For example, in a particular Midwest location, the basis might be 10¢ above the futures price. By entering into a basis contract, you can ensure that you receive a fair price when you sell the corn. This strategy provides stability and protection against price fluctuations.

2. Buy a Put Option

If you don't want to make a cash sale but still want to protect the current value of your corn, buying a put option is a viable option. A put option gives you a price floor, protecting the value of your corn futures prices.

For instance, March 2025 put options expire on Feb. 21, 2025, providing enough time to navigate through the holidays, the January USDA report, and any weather-related uncertainties in South America. One put option covers 5,000 bushels, and the cost varies between 10¢–20¢ per contract, depending on the strike price. This allows you to have peace of mind knowing that your grain is protected.

3. Make the Cash Sale and Re-Own with a Call Option

If you make a cash sale but worry about missing out on higher prices, buying a call option can be a solution. A call option allows you to participate in any upward price movement even after the grain has left your farm.

For example, March 2025 call options also expire on Feb. 21, 2025. One call option covers 5,000 bushels, and the cost varies between 10¢–20¢ per bushel, depending on the strike price and month. This gives you the flexibility to benefit from future price increases while still having the option to sell the corn at a later date.

The market volatility in the coming weeks and months is likely to be significant due to weather uncertainties and geopolitical factors. It's crucial to be strategic in your marketing decisions. Incorporating these strategies can help you navigate the market and make informed choices.

If you have any questions, you can reach Naomi at naomi@totalfarmmarketing.com or visit TotalFarmMarketing.com.

Disclaimer: The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Individuals acting on this information are responsible for their own actions. Commodity trading may not be suitable for all recipients of this report. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. No representation is being made that scenario planning, strategy or discipline will guarantee success or profits. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing. Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services, LLC is an insurance agency and an equal opportunity provider. Stewart-Peterson Inc. is a publishing company. A customer may have relationships with all three companies. SP Risk Services LLC and Stewart-Peterson Inc. are wholly owned by Stewart-Peterson Group Inc. unless otherwise noted, services referenced are services of Stewart-Peterson Group Inc. Presented for solicitation.

By Leah Douglas and Ted Hesson, this article delves into the concerns of the U.S. farm industry regarding President-elect Donald Trump's promise of mass deportations. The food supply chain heavily relies on immigrants in the country illegally, and the potential upheaval could have significant consequences.

"Farm Sector at Risk: Trump's Deportation Promise and Its Impact"

Immigration's Impact on the Farm Sector

In Washington, Nov 25 (Reuters), U.S. farm industry groups are anxiously awaiting President-elect Trump's stance on their sector. Nearly half of the nation's approximately 2 million farm workers lack legal status, along with many dairy and meatpacking workers. Trump, a Republican, vowed during his campaign to deport millions of illegal immigrants, a logistically challenging task that critics fear could disrupt U.S. businesses and split families.So far, Trump officials have not committed to any exemptions. Tom Homan, the incoming "border czar," has said immigration enforcement will focus on criminals and those with final deportation orders, but no immigrant will be exempt. This has left the farm industry in a state of uncertainty.David Ortega, a professor of food economics and policy at Michigan State University, warns that mass removal of farm workers would shock the food supply chain and drive up consumer grocery prices. "They're filling critical roles that many U.S.-born workers are either unable or unwilling to perform," he says.

Farm Groups' Concerns and Republican Allies

Farm groups and their Republican allies are encouraged by the incoming administration's focus on criminals. Dave Puglia, president and CEO of Western Growers, representing produce farmers, supports this approach but is concerned about the impacts on the farm sector if a deportation plan targets farmworkers.Trump transition spokesperson Karoline Leavitt did not directly address the farmer concerns. She stated that the American people re-elected Trump to implement his campaign promises, like deporting migrant criminals and restoring economic greatness.U.S. Representative John Duarte, a Republican and fourth-generation farmer in California's Central Valley, emphasizes the importance of immigrants in the area. Farms depend on them, and small towns would collapse if they were deported. He calls for the Trump administration to pledge that immigrant workers with no criminal record for five years or longer will not be targeted and explore avenues for permanent legal status.

Legal Options for Farm Labor

Farmers have the H-2A visa program as a legal option for hiring labor. It allows employers to bring in an unlimited number of seasonal workers if there are not enough U.S. workers willing, qualified, and available. The program has grown over time, with 378,000 H-2A positions certified by the Labor Department in 2023, three times more than in 2014. However, this only accounts for about 20% of the nation's farm workers. Many farmers find the visa's wage and housing requirements unaffordable, and others have year-round labor needs that rule out seasonal visas.John Walt Boatright, director of government affairs at the American Farm Bureau Federation, believes farmers and workers would benefit from expanded legal pathways for agricultural laborers. "We need the certainty, reliability, and affordability of a workforce program to continue delivering food from the farm to the table," he says.For decades, farm and worker groups have tried to pass immigration reform to enable more agricultural workers to stay in the U.S., but so far, the legislation has failed.Leon Fresco, an immigration attorney at Holland & Knight, notes that the risk of enforcement against farms is likely low due to the necessity of the workers. "There are significant business interests that want and need agricultural labor," he says.However, for farmworkers, the fear of enforcement creates chronic stress. Mary Jo Dudley, director of the Cornell Farmworker Program, is training workers to know their rights when confronted by immigration officials. Marc Perrone, international president of the United Food and Commercial Workers union representing some meatpacking workers, emphasizes that if there are raids on meatpacking plants, immigration enforcement should take precautions to avoid detaining legally present workers.Edgar Franks, a former farmworker and political director at Familias Unidas por la Justicia in Washington state, sees new energy among workers to organize. "The anxiety and fear are real, but together, we have a better chance to fight back," he says.