Posted 3/11/2019 20:41 (#7374462 - in reply to #7373961) Subject: RE: Race to the bottom.
I'm not as pessimistic. I'm ahead of most on low cost production. Tools for this type of trade.
Crop insurance. ARC/PLC. CCC.
2018 corn for example. Sold hta 4, rolled to pick up .1, sold 65% of production. Delivering now for minus 5. Net 4.05. 35% unsold. Here's where PLC came into play for me. I have 25000 bu of coverage after all adjustments including sequester. I had 10000 bu left unpriced. I ended up selling it at 3.70 cash. The PLC payment was .34 cents. Those 25k was 10k unpriced. 2.5 x .34 is .85. .85 + 3.7 is 4.55 per bu.
Also used a CCC loan for cheaper interest.
That's how I'm playing. Sitting now 4.2 65% sold. PLC is currently at .12. Times 2.5.
I'm not bragging. I figured this out in 2014. ARC money upfront or 3.70 price protection for 5 years. Net dollars Arc won. The money came in 14 and 15 and not in 17 and 18 when we needed it.