|
| I would look at dec 440 or 450 puts.
If Market is lower and you have a bigger crop, your indemnity payment may not be as big as you think however you have bushels to sell. Puts cover these bushels. If the market is lower and you do not have a bigger crop, then you have an indemnity plus you have the puts. If the market rallies and you have a shorter crop, you dont have additional sales and if we go back to $5.65 how much smaller crop do you need to receive an indemnity. If the nation has a much smaller crop (frost, other) and prices rally you have a substitute sale and can sell corn higher (that i if you produce enough to cover your first contracts) if prices are higher and short crop you will have a larger indemnity.
| |
|
Corn Hedge
