Large crops often result in low prices and a weak basis at harvest time. Low prices also occur in the summer when growing conditions are favorable for the new crop and old crop supplies are abundant. It is important to avoid getting trapped into selling during these low price periods just because cash is needed. Market strategies and cash flow needs should be planned to avoid these low price periods, so that sales can be made when rallies occur. Don't store too long.
Prices often recover, from harvest time lows, into winter.
In 1998, both corn and soybean prices increased rapidly from September into late November and early December. This rally offered significant storage returns, but it quickly faded at year-end. Storing into January was storing too long and resulted in losses, as prices never recovered significantly after that. For 1999 crops, storing corn until March produced the highest net returns over storage cost. The soybeans could then have been re-owned with futures or options with less risk and still captured the price gain.