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Eastern Half of Ohio | I am not sure that I agree that higher volatility corresponds to positives returns to space on the farm. Just ask the "Commercial Grain Buyers" that went belly up as a result of not hedging during the 08-09. Returns to space in my mind are generally a result of carries in the cash markets less cost of carry.
How does your model below indicate a guaranteed return to space other than implying that higher volatility can be loosely linked to high prices? The speculator still has to pull the trigger at the right time in the range. Might as well buy the board at that point and not take on quality risk of the stored commodity. | |
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How much volatility will we get this year? Price range?
