Very few places wouldn't benefit from storage. Unless your one of the lucky ones that live close enough to fill a ship or have a good end user. For the rest of us,we have to use all the tools to get a decent price.. Storage is just one of them. It is usually the best one since once you have it your options increase All you have to do if your undecided is drive around the country side. Every time you see a grain bin or set-up,ask yourself why he doesn't just use calls or options instead of storage. Most of these farmers have been down the options and futures market. Have found that physical grain in the bin can get you more dollars with less risk. many are better farmers than myself out there. Watch how and why and follow along. That said there is nothing wrong with using options when the time is right. Have used options many times. sell the grain and buy options. Works best later in the year so you can capture this so-called carry. The downside of course is taking care of the grain until it's sold.. Do it right it's not so tough.
Edited by sri 9/2/2010 11:34
|