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South Central Iowa | Why would a Chinese Buyer, who is purchasing physical beans, hedge it with a long contract?
Likewise, if the physical price has been set with the importer, like China, by the exporter, like Cargill, why would they hedge it with a long contract?
I could see it when the importer sets a basis contract with the exporter, sort of... But if the exporter, ABCD's, own the physical beans, they are short the board. If they sell those beans to an importer based on a set price, like how we all say China is buying our beans cheap, then why would the merchandiser ever have a long contract?
And why would the Chinese Crusher buy the board? They took their physical price.
Edited by Conan the Farmer 12/4/2018 12:34
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