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Southern MN | If you choose an HTA, you can lock in basis anytime before the delivery is supposed to start. The other benefit of an HTA is that you can choose to roll the contract forward to a future month if there is a carry in the market. Most places will allow you to carry forward once and within the same marketing year for a small fee, 1 to 2 cents per bushel. Those are the pros to HTA's, the con is that the HTA contract will cost you something, perhaps 5 to 10 cents per bushel depending on how far out you contract, and if the basis stays the same or gets worse, you're out that money. Basis would have to improve by at least the cost of the HTA to make it worth while. | |
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Hedge to arrive
