My "No NAFTA" Marketing Plan

[JimMeade]

Successful Farming has a story today that recommends we producers have a contingency plan in the event the U.S. exits NAFTA.

I have such a plan.  It is the same as if the U.S. does not exit NAFTA.  The plan involves my estimate of what prices will do if we exit NAFTA.  My guess is US farm prices will go down.  I doubt very much that prices will go up.  So, my exit plan is whenever I get the feeling the shoe is going to drop, I'll probably price most of my production.  Obviously, this involves timing, not always my strong suit.  But I don't see what else I can do.

Do you have a plan, other than hoping it doesn't happen or praying that farmers in Brazil go broke in a drought or hoping the Chinese starting having two babies per family?

[jec22]

I plan to continue winning awards with my subpar/average marketing plans.  So adjustments to be made are the easy ones. Don't let any middle man take any of my revenue if I can help it. (My marketing skills don't allow for more dependents).  Enjoy each day.  We have life so good. Most worries are a waste of time.  Control what you can control.

Of course, this works much better when you don't have debt payments. Though if the right opportunity presented, would take on debt for land. Grateful for those high price years to upgrade equipment/buildings with cash. Getting older is much more fun farming when the labor side is less stressful.

Still amused by all the spin. Before harvest...'we won't have room for this crop because of all the old crop sitting around", now, "the late, slow harvest is why some elevators didn't get full and/or fill piles."  

New GOP tax plan is revealing.  I had no idea how many ways ag was getting taken care of under the present code.  Most of the tax credits/crop insurance subsidies go directly to the landowner (i.e. rich).

[jec22]

Though Ag needs some help with spin.  So many think GMO's/ non organic in ag are bad. Yet when used in cancer treatment, CAR-T which alters white cells costs close to a million dollars for one treatment and is embraced as a great new treatment---and it is not a cure.

https://twitter.com/NovartisScience/status/940537292510330881

The science is interesting though. Some pretty brilliant minds in the world.  Of course these costs are just par for the course these days, which is why health care insurance prices are not coming down.  Pharma is the biggest drug pusher by far. Farmers are going to have to find ways to manage this cost, government has shown they will not even attempt to fix it--though seems so many patients/family think you spend whatever to live a couple more months anymore.

Jim, wasn't NAFTA terrible for the blue collar worker?

[BA Deere]

Notice Mexico isn`t threatening to stop sending oil filters and other products that they send us....oh no, we will be free to continue with a $63 Billion trade deficit with them.  It`s just the few ag products that they buy from us that they`re making a big hulabaloo about.  Supposedly building ports to import Argentinian corn that will cost them 70 cents a bushel MORE.   They must really think we`re brain dead if we`re going to fall for that.   🙂  

But until now, no one has ever stood up to them, after us being a willing doormat for 25 years, I suppose it is very disconcerting.  🙂

[jec22]

Seems dry dust (dirt) doesn't freeze.  Might be a story there.

[sw363535]

Jec22 it is the tech age ............. the level of ignorance is "Everest" high.

The american consumer talks out of 4 sides of its collective mouth.  Correct that ,,,,, the american consumer coaches and reporters talk out of several sides ....

One day it is white meat and healthy, the next day it is Tyson Chicken, the next day it is Chic-filet good for you.  The next day its animal cruelty.  The next day it is buffalo wings and Doritos for the big game.  

First its tofu good for you and wee need more soybeans, the health food of the future because it replaces red meat protein.  The next day its gmo corn killed the cows.... and Cargill sends me a letter to verify that our beans are not GMO because a cosmetics company wants them to not be GMO.....

We are sick........ and intellectually challenged.

[JimMeade]

You guys aren't answering Successful Farmings advice to develop a no-NAFTA marketing plan.  🙂

I thought dry dirt froze worse than wet - at least a lot deeper.  A dry year busts pipes while a wet hear has a film of ice on top that acts like an insulation layer and the ground stays warmer underneath.

I agree that Mexico will still find our ag products appealing.

[r3020]

My marketing plan is the same. When I need money I sell grain. I know I'm not going to out guess anyone anyway. Selling grain isn't nearly as depressing as selling Holsteins right now.

[elcheapo]

How am I going to write a marketing plan that includes actions of foreign governments, an
A capital were nobody can get along, I'm supposed to take the lowest price for wheat, beans and corn
In the world, because it's a "world market".
And lastly a marketplace where most trades are
Made by computers without a human in the loop
And the are look at "patterns", rather than weather,
Exports, crop conditions, etc

I would not even want to think what that formula
Would look like with that many variables.

And you think someone in middle America with
A simple computer that has things to do, is
Going to compete with the above

Impossible ((very very very very unlikely))

[BA Deere]

I think the subtext is "email your congressperson and say for the love of God, don`t change NAFTA!!".   I think a lot of the trade uncertainty is already priced in the market, however, yes if the headlines are "US pulls out of NAFTA" it`ll be a down day in the markets....just because they can.  Now, will a new bilateral deal be made that might be better for farmers and the manufacturing sector, that will be the focus immediately there after.  

So, if you`re worried you $3 corn will drop to $2.50?  Buy a put.   And if any changes happen, it might be after spring prices for crop insurance are set in March, so perhaps a lot of 85% RA coverage will be taken out?   🙂