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Co-Ag Farm
Recently there have been many questions about wether or not an HTA contract is feasible right now....so let's find out. Starting today, I sold 1 (5000bu) September 2014 Chicago (ZWU14) futures contract at 6.14, cash today was at 6.85. That gives me a starting basis point of +71. Today's nearby basis is +1.18. If the Septemeber basis runs to anything close to that number it will be great, and will add to what would have been a 6.85 cash sale. However, if the basis goes the other way it will be taking away from what would have been a 6.85 cash sale, and if it goes negative it will really hurt!
I'll also do the same with a December 2014 Chicago contract (ZWZ14) sold at 6.29, cash at 6.95 with a +66 starting basis to see is the later months fare any better or turn out worse.
I LOCKED IN THE BASIS ON THE SEP HTA TODAY AT +1.33 GIVING ME A PRICED CONTRACT OF 7.47, WELL OVER THE ORIGINAL CASH PRICE OF 6.85 AND BEATING TODAYS CASH PRICE OF 7.14. SO THIS HTA WORKED OUT IN MY FAVOR, EVEN STARTING WITH A POSITIVE BASIS. I'M GOING TO CONTINUE TO HOLD OUT ON THE DEC HTA TO SEE HOW HIGH THE BASIS WILL GO!!
I'll update weekly to track how this HTA contract is working out.
Take a look at the Co-Ag Farms J.V. Link to find out more.
Chicago futures are currently up 2. Wheat importers from Egypt (the worlds top import) continues to throw a no hitter against US exporters. Instead of buying wheat from the US, Egypt continues to purchase wheat from Russia, Ukraine and Romania. Also adding pressure to the market is the fact corp estimates out of Russia are starting to move higher not lower. In return domestic Russian wheat prices are enduring another setback.
Pea & Lentil bids - 05/06/14 - Green/Yellow Peas and Pardina's are slightly up. Regular Lentils are limited. PL480 tenders - pricing continues on the low end.
