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Iowa | I mostly raise crops under contract to one end user. The end user provides several options for pricing and setting basis, so I no longer feel the need to have a hedge account. I tend to forward price close to half the crop in small increments with various types of contracts by mid July and usually don't price the rest until after the following January. That usually works ok, but it not so much for the 2020 crop. I am far from being psychic or a genius when it comes to pricing commodities.
I was not really using the hedge account that I did have, just left some money in there to keep the possibility open. Then Corzine raided my account to finance his speculation (never did get all of it back). There were papers I could have signed to open a new hedge account with another company. They wanted to know all of my personal finance account information. That sort of rubbed me the wrong way. I think they should have been giving me access to all of their financial account information or maybe a lien on the CEO's house and personal retirement account would have been even better.
Mostly, I just try to keep things simple. It's not hard to get more complicated contracts floating around than one can easily keep track of, especially if you make too many deals over the phone while planting across a field and forget to record them when you get back home. I sleep better knowing and understanding what I have. Like Cling Eastwood said, "A man has got to know his limitations." | |
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