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New York, New York | Hi-
I'm new to the Ag space and just wanted to ask a few farm related questions if you guys are willing to help me out:
1) How do farmers sell their crops?
- To a grain elevator? Are there other buyers?
- I keep hearing about basis, which makes me think that all crops need to be sold through elevators...
- How does hedging with futures work? Do farmers generally deliver crops at expiry? Who generally receives delivery (elevators?) and what costs are associated with this? What is the delivery process like?
2) Are fertilizer prices too high?
- I've looked through some USDA estimates to farm costs and making some adjustments for fertilizer prices it looks like farm receipts look very good even if we assume crop prices from the lows of this year and current fertilizer prices. Is there a lot of push back from farmers at these fertilizer price levels?
- For corn in particular, it looks like even with current prices, if fertilizer prices went back to 2008 levels receipts would still be above the 10-year average.
- What are your general opinions on purchasing fertilizers at current prices, and what what were your opinions of 2008 levels?
Much appreciated in advance! | |
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Some questions from a newbie
