On a cautionary note, herd expansion continues.
A corn producer who sells his corn in the spot market after harvest, and believes prices may go higher, could purchase a call option for the chance to be long the market and retain ownership.
From a price support rationale, probably the most supportive variable is that corn is currently priced at a level where most producers are losing money.
A recent price recovery in both live cattle and lean hog futures contracts is offering an opportunity for producers to lock in better prices than existed just a few weeks ago.
Ample supplies of many commodities, both domestic and worldwide, suggest there’s no urgency for investors to shift dollars into commodity ownership, at least not now.
Unlike soybeans, which have experienced increased volatility, the corn market continues to consolidate.
A common trend is for prices to move lower into the fall, and then recover by the time December futures stops trading.
Strategy 1 is keeping corn in storage. Strategy 2 is selling your corn and buying futures. Strategy 3 deals with purchasing a call option.
Managed money has established net short positions in the ag commodities.
As summer winds down and harvest draws closer, expectations that corn prices will find a low, after sliding from midsummer highs, are likely correct.