west central Ohio | BronsonA2150 - 12/1/2018 08:58
Wondering if this seems like a legitimate scenario or if it's a waste. Right now an August contract for feeder cattle is $5/cwt higher than May. Problem is, a feeding period I'm looking at would end up having calves go to market in June/July if I bought now. In order to get into August market, I'd have to wait until February to buy. Calves are going pretty cheap right now though, so I feel something should be put in place to capitalize on current price. Could a person hedge long right now and wait until February to buy and go ahead and short an August contract? I'm thinking that would roughly lock in current cost while being able to wait to buy and take advantage of higher August market. Would that make sense or am I off?
I’d just buy the cheap calves now. |