The prize is likely on the minds of producers who will make history by meeting virtually this year because of COVID-19 – at their factory district meetings, lender meetings, and even their annual meeting. company, according to company officials.
The stock selling “season” usually begins in early fall and ends in March or April. The shares offer rights and obligations to market the beets through the closed cooperative.
This year, FNC Ag Stock LLC of Grand Forks made the first sale of the season on August 28 – a record 25 shares at $ 3,950 per share. The brokerage had 50 shares listed for sale at $ 3,900 per share and 100 shares listed at $ 4,100. Individuals willing to buy shares were offering up to $ 3,750 for 50 shares.
Jayson Menke, broker for Acres & Shares, a brokerage firm in Grand Forks, said that to date there have been four sales of shares traded.
“Brokerage sales are off to a good start, based on an almost perfect harvest, higher sugar content and optimism about sugar prices,” he said.
Chris Griffin, president of Red River Land Co. of Grand Forks, said his first sale was on September 17 at $ 3,850 and the company’s most recent was $ 3,900.
This compares to a previous record high in October 2012 of $ 4,400 per share, but at that time, farmers were allowed to plant more acres per share.
“On an acre planted basis, we’re near a record, if not a record,” Griffin said.
Given that today’s shareholders are only allowed to cultivate 74-79% of their shares, this translates to an effective price of $ 5,064 per acre planted. The price hit a record $ 4,400 per acre in October 2012, which would have been an effective price of $ 4,944 per planted acre.
Andy Gudajtes, of FNC Ag Stock, said farmland in the Red River Valley costs around $ 2,500 to $ 5,000, with the highest prices being the land where non-irrigated potatoes are grown.
“This shows that there is optimism in the sugar beet industry,” he said.
The cooperative has 500,000 shares outstanding. According to American Crystal Records, shareholders harvested an average of 426,000 acres of beets in the 2010, 2011 and 2012 crop years. By comparison, they harvested 398,000 acres in 2017, 385,000 in 2018 and expect to harvest 405,000 acres in 2020.
The high selling price is likely related to high expectations for payment per tonne of sugar beet and a good harvest, Griffin said.
“There is some variability due to the rain, but overall a strong harvest,” he said.
Favorable trade policies of recent years are other encouraging issues. It’s too early to predict the volume of stocks that will change hands, Griffin said.