Blake Lauritsen Is 2014 Marketer of the Year
January 30, 2015 From Cotton Grower Magazine – February 2015
Cotton Grower, IntercontinentalExchange and the Certified FiberMax program of Bayer CropScience are pleased to honor Blake Lauritsen of El Campo, TX, as the 2014 Marketer of the Year.
“For 24 years, this award has been given to U.S. cotton growers who demonstrate excellence in a marketing program,” explained Dr. O. A. Cleveland, professor emeritus of agricultural economics at Mississippi State University, who makes the annual presentation.
The award is presented each year during the National Cotton Council’s Beltwide Cotton Conferences, held this year in San Antonio.
If some type of mystical marketing program exists that can accurately flag the highs and point out the lows of the cotton market, Blake Lauritsen sure doesn’t know about it.
But then, he seems to be doing just fine on his own.
His attention to commodity markets, the global cotton industry, good business sense – and a bit of luck, he’ll admit – allowed Lauritsen to make the most out of marketing his 2014 cotton crop. It also earned him the 2014 Marketer of the Year award, presented during the recent Beltwide Cotton Conferences in San Antonio.
Lauritsen is a fourth-generation farmer, working land that’s been in his family since the late 1800s. Located in the Danevang area, a small Danish community near El Campo, TX, the farm now covers a total of 3,200 acres – almost solely planted to cotton – which he farms with a cousin and one employee.
“Like my dad, I basically started farming when I was a kid,” said Lauritsen. “I remember tromping cotton trailers, but really started helping out driving tractors and doing other things when I was nine years old.”
He’s been “officially” farming since 2004, and assumed full responsibility when his father retired after the 2012 crop. Marketing came as part of that responsibility.
So what’s his secret? Lauritsen swears it’s nothing more than paying attention to the markets, understanding their cycles, and trusting your gut.
“I review the market reports we get from Jeremy Speis and the staff at Calcot,” he explained. “Then, using historical logic – and knowing that high prices can’t stay around forever – I attempt to find myself a spot where I believe I can be profitable and be happy with the price.
“Depending on the reports, I’ll determine if I want to sell or hold out. Sometimes, I should have sold when I held out,” he laughed. “And vice versa.”
Lauritsen admits to watching all commodity markets closely, with a keen eye on his prime bellwether market – Midwest corn.
“Everything seems to follow corn,” he said. “When I starting hearing talk about corn prices backing down, I knew cotton was going to eventually follow. So I felt like that would be a good time to sell some cotton I was holding. I was fortunate enough to hit a good market point after harvest.”
Lauritsen diversifies his marketing efforts to help spread his risk and potential for success. He contracted part of his 2014 crop early while cotton was in the 80 to 84 cent range, and contracted a bit more after planting. Then, cotton followed corn downward. So he decided to hold the rest of his crop and wait for something to happen.
“The price really wasn’t moving up or down. It was staying within a five cent window,” he recalled. “I didn’t feel like I had anything to lose, so I just held out. We pretty much stayed sideways all the way through. After harvest, I fixed the last of the crop in the 65 cent range.
“That was as good as it was going to get.”
As a Calcot member, Lauritsen does utilize the cooperative’s pool program from time to time, in addition to his own self-marketing efforts. He generally focuses on a mix of personal sales and the pool, but admits the pool may be the better option in a down market.
“Things are changing so fast in this market, especially with it being as volatile as it’s been since cotton fell from $2.00,” he said. “Each year is different.”
That’s experience talking. He’s learned that trends can be helpful, but often don’t mean much.
“One year I tried to hold out on some cotton and take advantage of a three-year pattern of high prices at harvest,” he continued. “I always sold and got beat on that. I would watch this high point come, and I wouldn’t have anything to sell. So, when I decided to hold a bit, the market was the complete opposite and fooled me.”
In spite of current market conditions, Lauritsen remains bullish on cotton’s future. His 2015 cropping plans call for 100 percent cotton. “It has always been a better crop in our area and for our operation,” he stated.
He does well growing it, too. Lauritsen’s farm includes both irrigated and dryland cotton acres. In 2014, his irrigated fields averaged more than 1,300 pounds per acre, and his dryland acres made more than 1,000 pounds on average. He’s proven that good yields can help overcome lower prices.
“I think cotton has a chance to come back and that history will come back into play at planting time,” stated Lauritsen. “I believe cotton acres will be down overall. I communicate regularly with a cotton farmer in Australia, and it sounds like they’re going to see a lot of acres diminish there. I would assume the rest of the world will probably follow. That seems to be the precedent that’s been set. And there are still attractive commodity options to farm that require less input and less labor than cotton.”
Lauritsen plans to examine as many acreage predictions for the world as he can while plotting his 2015 marketing plan. He’s also keeping an eye on key foreign markets for indications of any actions that could impact the market.
“We have to pay attention to the world,” he said. “We ship cotton to China and other countries, and we need to focus on what those countries are doing to use up the product we have. Otherwise, we may end up sitting on a lot of cotton that no one is using. Then we won’t have a price anymore.”
And when you’re holding the reins of a four generation family farm, that’s an option Lauritsen refuses to consider. That’s just the family way.
“Dad always told me I needed to be on the farm to make sure things are being done properly,” he said. “He taught me everything I know, and I’ve tried to do the best I can and grow upon it. That’s the goal, especially in a farming operation like this that’s been handed to me to maintain.”
As for the future, look no further than the fifth generation – two lovely young ladies that are the pride of Lauritsen, his wife Jessica, and the rest of the extended family.
“It’s nice to have family around and working with me,” mused Lauritsen. “I’d like to keep it a family operation if I can.”
GET THE NEWSLETTER TODAY!
