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sw ontario | Even on the insurance leel you may want to choose who you are contracting with ---think 2008 wheat in March , record futures run up ,elevators/farmers running out of margin money , basis going minus big time , ADM wanted commodity delivered wether you had it or had too source it at your cost too fill contract......in our area anyways 2007 crop was kind of a failure so a bunch of contracts carried over to 2008 , CBOT locked in at say $4 and we had been dealing with crappy dollar so our basis was $1.50+ ,then our $CAD went to par or above USD , basis went too -$2-3 and wheat our of field became worth $2 or less ,some guys getting .80 cents bu. .....asked local Cargill manager what was going to happen as we had not locked in our basis but had rolled CBOT contracts that we could not fill in 2007 to 2008....his reply was "if the wheat is dry you probably won't have too pay us too take it" ...cash at Harvest was around $5.50 , old contract we got about $2 bu., our new contracts got $8.50 at same time.. was same at all elevators so after that they all wrote contracts that either you delivered or paid difference + penalty for default same yr., no rolling ahead.....so my experience is unless you can think like Maizing or Ray J you should be very conservative in sales and futures | |
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Maize or Ray
