Many producers who need the forward protection the most do not have the financial support to face off margin calls waiting for the promised price levels. For many, forward contracts to deliver are necessary to set a position and those are reversable only as a gift from the purchaser. But even a position on the board is not one a new tennant is obligated to fill in the months after a health issue invades.
I struggle with the desire or promotion that older producers or leveraged young producers (or anyone for that matter) should take marketing actions 12-24 months out. It steals options and occasionally locks them into serious financial problems. I have seen a couple of older guys that suddenly needed to find retirement( and a tennant) deal with some struggles trying to lay off contract obligations that were $1 off the market. It sure limits the possibilities of helping a young farmer get started. Often It limits the tennant to a local big operator that can absorb the positions.
Difficult times come and go ----- it's part of the business -- or should be----- and Jim, I would be even more adament about the issue if the usda was projecting $7 corn for the next 5 years. Even bigger mistakes would be encouraged.
I don't see it as a huge market manipulation for profit as much as one more example of how much bureaucracy wants to be involved in the economy. Perhaps even has a egocentric feel that the economy needs government control. And why wouldn't they when ethanol is built on government grants and subsidies.( and a thousand other examples)
Their interjection into the economy is the primary reason many of our costs will not go down with the price of corn.
We have been the recepient of the benefits of big government's manipulation of the economy and we will be the victum at some point of too much government input.
