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Selling Corn in the Wheat Pit
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Maizeing
Posted 7/31/2020 12:22 (#8407022)
Subject: Selling Corn in the Wheat Pit


Ontario's middle east
It is not a strategy for everyone but if you are in an area that can grow SRW, you should consider this. Sell anything you reasonably think you could produce for 22 harvest on the board in wn2. Wheat seems like it wants to remain very volatile. Wheat being wheat, so to speak. If wheat drops back down, you can lift that hedge, and are free to grow corn. Worst case scenario, wheat continues on up and you have to plant wheat. That's why you don't do more than you can possibly produce. This strategy has been very effective the last few years and I have yet to plant wheat. I don't think we have much time left on the 21 crop before planting decisions so I'm moving out a crop year. You also need to consider local basis and don't set yourself up with anything that is going to be a negative margin in the cash market. That shouldn't be a big problem for many with $5+ cash opportunities.
For our customers, we are again doing this in cash contract form with the option to roll contract equity over to a corn year of your choice. Maybe another(possibly last) opportunity to slap some lipstick on this pig of a 20 corn crop. Give a call if you want to discuss the details of such a strategy. The short side of the board is not your risk folks. Be careful out there and good luck.
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