Posted 3/26/2020 14:53 (#8140719 - in reply to #8140658) Subject: RE: Ethanol plant managers
Centuryfarm - 3/26/2020 14:27 When futures prices are at 3.32 you are at the bottom percentile of the range and your risk exposure is very limited. It seems like the ethanol management is the ones showing their lack of knowledge. What is your risk going into the spring down .20? I would take those risk reward ratios anyway. It is hedging BTW not speculating. These are the same people that chastised farmers last May June July for not selling 4 dollar cash corn. You can’t have it both ways.
Any plant manager that buys feedstock without locking in margin by selling Ethanol and DDG’s is speculating with other people’s money. Any plant manager that speculates with other people’s money should be fired. Sure corn seems cheap. Is CF going to stand the other side if Ethanol and DDG’s don’t rebound enough to turn a positive margin when crush time comes?