NEW CROP CORN & KC WHEAT

What we like doing:

Ideally, we like simply putting a floor in using short-dated options.

Whether that is a week, two weeks, three weeks or longer.

This gives you the ability to lock in a floor while keeping your upside open.

So you can give yourself a worst case scenario and ride it up, while the situation develops.

Because there is a scenario where the rally continues if this Iran situation continues to escalate and crude oil goes beyond $100, taking corn and wheat with it. So we want the ability to partake in that potential upside. Or there is a world where things get resolved and we give back the rally. It’s an unknown. Options let you hedge against the unknowns.

It feels like this rally should be rewarded in some sort of manner. Wheat is $1.00 off the lows and Dec corn is at 2-year highs.

If you don’t have a hedge account, this is why it’s a crucial tool to have, especially in new crop. Hedge accounts give you different options and flexibility.

If you don’t have a hedge account, then you could consider an incremental sale, whether that is 5% or 10%. But our preference is using options.

If you’d like to discuss different strategies or open a hedge account with us give us a call.

Office: 806-484-1214

Why the alert?

Dec corn hit our next target.

$4.84 gives back 61.8% of the contract highs.