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producers that are hedged
What going to happen to the producers that are hedged fro this crop and now will not have the bushells to cover these hedges. How many producers and how big of a risk is it to the market and how many grain buyers have performed this in contracting crop for this year. If this crop has abandonment and poor yields some are predicting are we coming to trading bubble crisis in America. There won't be enough liquidity of supply to cover these hedges coming this fall and coming year. I guess i don't know what happens when supply is short in past you always could buy inventory but what happens when there isn't grain to purchase. I know i am talking worst case scenario and shouldn't happen but i guess were also talking about drought that appears could be worst ever for the grain mariket been doing business.
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Re: producers that are hedged
I have some sold ahead but I've been scouting and I'm sure I can easily cover mine. I'll just not make as much money as the the rest of you.
I don't know how many people are so aggressively hedged that they won't be able to cover. I was talking to my buyer recently and he said that the processors were expe cing the physical grain. I have no idea what affect that will have around here.
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Question and answer I should know but, I don't
I know that a producer can't meet the requirements to deliver to and enforce the face value of a futures contract should it be in his favor to do so. Can a big entity force producers to deliver to satisfy contracts? This is laregely a theoretical question - I think. But the discussion brought it to mind.