Farmers in the past few decades have had the luxury of (for the most part) being able to get "beared" up and crop revenue assurance insurance bailing them out to cover contracted bushels if they can`t deliver. But insurance washes their hands of you if prices rise above a couple bucks of the price guarantee. That $4 corn that you prudently lock in 100% of your APH on could look really ugly come October if corn is $8 and your yield is sub APH.
When corn is in a multi-year sub $4 trading range, there`s little concern that you won`t be able to deliver the contract and "worst case" there`s always a 2+billion bushel carryover hanging on the market.
I don`t know what 2021 will bring, perhaps acres will be there at expense of hay ground and cotton and the gas gauge will never get below 1.7 billion bushel carry and everyone`s yield monitor won`t dip below 250 and China will cancel shipments and good yields around the globe. Maybe January prices will be the top of the market?
This demand driven rally is a different animal though, perhaps "crackpots" will be right this time? A demand rally and if the ducks don`t line up in production has a higher risk in the new year. I guess if I was to commit unplanted bushels of Z21 corn and beans, I`d have a put in place, just in case 2021 is the year dogs and cats start shacking up.
