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How do you price/protect 'unknown' production?
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dpilot83
Posted 1/11/2010 09:00 (#1016494 - in reply to #1016486)
Subject: Re: How do you price/protect 'unknown' production?



First of all, the probability of a commodity going to $0 is much lower than a commodity doubling or tripling in value. Secondly, you have to make sure that you're in a financial position to write those checks, even if the value of your crop is increasing in the field at the same time that you have to write the checks. Finally, you have to make sure you get your crop planted and that it will actually yield the 40% more than what you contracted for at the elevator.
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