MARKET DATA, INC. – SUMMARY OF MARKETING ADVICE FOR 2004

 

FROM GREG’S GOSSIP – WEEKLY ADVICE – ON SOYBEANS:

 

JANUARY 15, 2004: We are looking to begin making sizable sales or taking profit on call or futures positions with MAR soybeans in the $8.30 area. Move to at least 85% of your 2003 OC price protected or sold. Remember that IT NEVER HURTS TO SELL AT A PROFIT so check your target prices carefully and enter orders accordingly. If you had replaced any OC cash sales with futures or options positions, it may be a good time to finish taking profits on these positions. Begin NC pricing with NOV 04 futures in the $6.70 area on 10% and move to 30% priced with $7.00 NOV futures. NOV futures traded around the $7.00 level 42.3% of the time in our similar years.

 

March 25, 2004 GOSSIP HEADLINE: PROFIT ALERT ON CORN AND SOYBEANS - GET 50% TO 70% PRICE PROTECTED NOW!

 

Our similar years show that NOV soybeans traded above $8.18 just 3.5% of the time and are currently at $7.84 after hitting $7.99 this past week. Look to get 40% cash sold when NOV 04 futures are in the $7.80 area and 50% priced with $8.00 NOV 04 futures.

 

April 8, 2004 GOSSIP: PROFIT ALERT on CORN and SOYBEANS - Get 50% to 70% PRICE PROTECTED NOW!

 

Move NC pricing to 40% with NOV 04 futures in the $7.60 area and add 10% more with $7.80 and 10% more at $8.00 NOV futures. Our review shows that NOV futures trade above $8.39 just 3% of the time in our similar years by the end of October. You could look to at a MIN/MAX plan of "BUYing a $7.60 NOV bean put and SELLing a $8.80 NOV bean call for a net cost of $.30 to the BUY side" on up to 60% to 80% of your irrigated production or crop insurance bushels and 40% to 70% of your dryland insurance bushels.

 

RESULTS:  NOV futures had a high price in early April, 2004 of over $7.95 a bushel, which hit our target where producers should have been at least 40% price protected.  This compares to an October 1, futures price of around $5.37.  This means that those that did 40% of their crop pricing under our plan should have been at least $1.75 higher (10% priced at $6.70, 20% at $7.00 and 10% at $7.80 = $7.12 avg.) than the October 1 price or $21.00 per acre better assuming a 30 bushel per acre soybean yield.

 

If a producer followed our advice on 40% of their crop, they should have netted a $20.00 per acre higher return than the price available October 1, 2004.  Assuming their cost for our service is $.50 an acre ($400 base cost for one commodity divided by 800 acres planted to this commodity) then they had a 40 to 1 overall return on the cost of their service.  Added return of $20.00 per acre, divided by a $.50 cost = a 40 to 1 return. This does not include any profits they may have had on the MIN/MAX program or from buying put options on any part of the crop over 40% as we encouraged them to do.

 

For more information look us up at www.marketdatainc.com or call 1-800-867-8289.