5 Tips for Marketers to Capitalize on Bullish Grain Market Prices

It’s been a long nine or so years for a lot of U.S. grain farmers. But grain market prices have finally turned around. Corn prices with a five in front of them and $13/bushel-plus soybean prices have a lot of farmers breathing sighs of relief they’ve held in since about 2012. There’s renewed optimism in farm country.

Along with that optimism comes a lot of pent-up spending power and demand that’s been kept under wraps as farmers worked to just break even for years. Corn prices closer to $3/bushel had a lot of farmers holding off on buying things like new machinery as a way to contain costs and offset the grain bears. Now that they’re bulls, that’s changing. But if you’re an agriculture company, don’t start counting your chickens quite yet.

Farmers who have been around — those most likely to have the greatest purchasing power in agriculture — have seen this movie, and they know how it can end. The farm crisis of the 1980s led to a lot of disappearing liquidity and lost farms. Memories like that don’t fade quickly, and rebounding prices don’t mean checkbooks will be flying open just yet.

Farmers have to buy equipment, machinery, crop inputs and more to keep their farms operating. You have to spend money to make money in agriculture. Not every ag company will be the benefactor of $5 – $6 corn. Even with continued news of fundamental strength to the market, farmers are still generally cautious and spending prudently and selectively in 2021. If grain market prices stay where they are or move higher later in the year, that will likely remain the case.

If your company or brand is competing for a piece of that farm spending pie, here are a few ways to market your products or services to generate real sales this year and beyond.

1. Identify with your customers

A lot of agriculture companies have shared in their farmer customers’ struggles in recent years. Fewer farmers buying tractors, planters, tillage equipment, sprayers and combines was felt by manufacturers. Many of whom had to make adjustments of their own to stay in business.

Whether you’ve experienced those troubles or not, show that you understand the ups and downs farmers have faced and why they may still feel cautious about making new purchases, large or small. Identify with your farmer customers.

2. Offer tangible solutions

An old boss of mine would lecture me regularly, warning me to not “create a solution looking for a problem.” Even as farmers start to feel more confident to spend money in 2021, that doesn’t mean they won’t be as practical as ever.

Position what you sell as a solution to a problem your customers already face. Through things like thought leadership and overall campaign messaging, demonstrate that your solution has real utility at the farm level. The more frequently you make that connection, the more confidence farmers will have in you and the solutions you can offer them. In the end, farmers will only become customers if they see that what you’re selling will help them be successful.

3. Be realistic

Corn prices are in the $5/bushel range. Not the $8/bushel range like they were in the flood year of 2008. Today’s grain market prices are a major improvement over prices in the last few years. But, that won’t create a lot of new millionaires in farm country.

Recognize that farmers will likely approach new spending cautiously. They will be searching for things that will make incremental improvements to their bottom lines. Now is a time to demonstrate how a fertility product, for example, can improve yields incrementally without adding much to production costs.

Set the bar in a realistic place and you’ll not only be more likely to achieve your goal but you’ll also prevent the reaction most farmers have to “pie in the sky” promises (hint: Not one that’s going to sell a lot of product).

4. Become a partner

For about the last decade, experts in the farm management sector have encouraged farmers to assemble their “farm teams.” That group comprises trusted advisers (another big buzzword in agriculture right now) like agronomists, accountants, attorneys and farm managers who work with high-value information and data. Trust in that group is very important.

Demonstrate to your customers that you understand their business. Offer them realistic, tangible solutions to existing problems in revenue-generating ways. That will go a long way to building that trust. That will contribute directly to sales as long as you can maintain that trust over time.

5. Listen and be ready for change

Like any grain farmer knows, what goes up must come down. New expectations for a massive corn crop in 2021, for example, could send grain market prices lower. On the contrary, the outlook for lower soybean output could send those market prices higher. Either way, the grain market prices will change in the future.

Make sure you’re attentive to marketplace changes like these and what they mean to your customers. Be ready to adjust things like product pricing to prove you’re paying attention. The more proactive you can be on this front, the stronger the trust you’ll build with your customers.

Final thoughts

One piece of advice I’ve heard repeated several times since the grain markets began their rebound: Don’t always go it alone. The most skilled grain marketers out there, for example, often employ the help of professional analysts or brokers. This maximizes the returns of their marketing strategies. I hear a lot of complaints from farm country about the expense of such services. But when the grain markets present opportunities like they are today, it’s usually worth the cost to capitalize on the rally while it lasts.

As many farmers know, it doesn’t take much for things to turn around, so if working with a broker — or for ag companies, a marketing agency — helps you “make hay while the sun is shining,” it’s a good call.

If you’re interested in having that conversation to help better connect with farmers to generate new sales, let’s talk.

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