OLD CROP & NEW CROP

Who is this alert for?

Old Crop Corn:

Must Move by May + Weak Basis

Protect the board first.

Those that need to move by May protect another increment of corn via buying April or May puts or selling futures if basis is weak and expected to firm before you have to move it.

Must Move by May + Strong Basis

Capture basis.

If basis is strong and expected to weaken, you could sell cash corn and re-own with April or May calls. Leaving your upside open in the event of a spring rally.

Do Not Need to Move by May

Those of you who are holding old crop corn until late spring early summer you can simply continue to hold and remain patient, but we like buying April or May puts to reduce some risk.

As the puts are cheap enough up to get 100% protection and it’s simply good risk management

New Crop Corn:

Behind on Normal Sales

This is just a starter hedge.

Sell futures, buy puts, sell calls, HTA or a combination.

We aren’t going overboard on new crop here.

But we like catching up with however much you normally have sold if you are behind your normal sales pace.

You could also consider buying short-dated new crop puts to get you to the seasonal time frame when you prefer to make sales.

Prefer to Wait

If you are not ready to commit to forward sales, then we like buying short dated new crop puts to bridge the risk gap until your preferred window of sales.

If you have questions or want specific information regarding your operation, give us a call or text

Office: 806-484-1214

Why the alert?

May corn has clawed back 61.8% of the November highs.

That retracement level comes in at $4.50

This is a common spot to find resistance.