Heil Harvesting, Ulysses KS/Limon CO | It sounds to me like that deal is a little fishy and mismanaged.
But
There are a lot of big good elevators in trouble, there banks put them on a line of credit and when they are out of credit they could be done even though they only have the ability cover the price difference with a cash product at harvest. Bottom line some of these banks can't cover them any more.
Figure that you had a million bushels contracted in on you at 6 bucks and have rode this deal up to eleven on your short hedges that if 5 mil in margin calls. Bank won't/can't loan it to you anymore, KCBT sues you, you are done. It is a legitimate hedge, not being hedged would be speculation-- |
Is Wheat Deserving of this move?
