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Ontario's middle east | I tend to agree that bins are for capturing carry. You have it backwards though. You want your short position in July so you need to sell July and buy the Dec. I do like your target levels. Getting rid of the short July is easy, just exchange futures with the buyer when you sell cash. Getting rid of the long Dec is the tough part. You are asking when to sell corn. That is an age old question that we beat on each other here on a daily basis to know avail . I would suggest you focus on revenue per acre, not price, and come up with some incremental sales targets and enter those as open market orders. That takes the emotion out of pulling the trigger. The situation that gets you that carry and that price are diametrically opposed. To get the bear spreading, the market has to get comfortable with the new crop supply. The situations that brings that is not price friendly, it's one that will discount the front end. Prespreading is a great idea but I hope it doesn't work. I hope you get the opportunity to price the Dec corn on a spring rally. Maybe Roy Smith's "always sell corn May 1st" rule will pull through and give us the opportunity to get short dec first and then the spread order will just move the short out to July later and cancel the short dec, if the crop is doing well in the summer. My guess is if that spread order executes before you are short Dec, this will be the most vile page on the internet. | |
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Storage Hedging
