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| interesting to note that the big boys in the last two years have only delivered 7.5 Million bu vs licensed capacity of 160 million bu. Today there is 94+ million bushels of wheat in deliverable space...Seems to me the big boys are paying -1.00 taking a normal elevation and shipping wheat at severe discounts to delivery to create space for the producers fall harvest. If delivery is the market then whats the other 86.5 million bushels doing? delivering grain does not clear stox. Egypt bot 2 cargo's of wheat this week both of which were sold originating from Russia at a $20/MT DISCOUNT to USA. French wheat were the next closest to trading. Delivering wheat to a non consumptive user does not clear stox. Also, what is the taker doing with the delivery he accepts? That person or rather fund is owning the wheat vs full carry to the next deliverable month. So the stox sit in the facility. You cant run a business unless you can unload the producers truck. When the market exhausts the natural seller and the demand for futures contracts still exists then futures prices go higher.....Its not the cash markets job to control that. Nor is it the exchanges job to guarentee the long or taker a fixed rate of return. Gulf HRWW 12 protein today traded at option price and will load out of a deliverable facility....Thats -85 fob interior ks. Wheat is worth what its worth in the world if the market wants a 0 basis and a $4.70 board he still gets the market price for his grain and looses out on the CRC revenue calc that is based off futures values rather than cash price. | |
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What happened to the wheat basis
