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Hedging Grain Price Risk

By: Craig Haymaker, Chief Operating Officer

Grain price risk continues to manifest itself in the marketplace as major grains – corn, soybeans and wheat – exhibit either marked volatility and/or downward trends in pricing. This presents meaningful hedging opportunities for consumers and producers. As corn prices continue a steady decline, consumers might consider locking-in near term prices with HTAs and fixed forward contracts, and locking-in long term prices with futures and swaps. Wheat producers should consider increasing their hedge ratios with puts and short futures. For soybeans, price volatility persists – near term call options for consumers may prove too expensive so organizations should consider costless collars, or a mix of collars and swaps for the longer term outlook. Why HedgeStar?

We offer hedging savvy and back-office expertise from advisors, CPAs and quantitative analysts who exemplify our core values every day. Let HedgeStar be your guide for cultivating a hedging program that meets your needs and aligns with your risk appetite. Call an expert today.


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