How Do Producers Decide the “Right” Moment to Price Their Crop?

This research investigated the timing of marketing decisions in the Canadian wheat market. Cox proportional hazard models were estimated to explore how the timing of producers’ decisions were affected by market-based variable, which included an indicator showing whether current prices were above producers’ benchmark on a given day, 10-day average spread between current prices and producers’ benchmark, 10-day price trend and price volatility over 10 days. Marketing data for 17,338 producers who executed 59,184 transactions between 2003/04 and 2008/09 were used in the analysis. Overall results indicate that all variables affected timing decisions in producers’ marketing choices. However, the signs of the estimated coefficients tended to vary across contracts and years, suggesting that producers could change their pricing behavior over time and response to the covariates could also depend on characteristics of the contracts and how they relate to producers’ marketing strategies.