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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 closed up 6 cents with KC and Mpls up 2 cents. First day of spring wheat tour is showing an average yield of 48.3 bpa which is 5 bpa higher than last year and 5.4 acres higher than the 5 year average. Wheat has lost 19% of its value during the last 12 months. Egypt filled their tenders with Russian and Romanian wheat. Reports showing Canadian yields down and Russian yields up.
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.
