Corn marketing strategy for new crop 2021
Sell 1 December 2021 HTA @ 4.30
Buy 1 December 2021 4.20 call @ .40
Sell 1 December 2021 5.20 call @ .14
Net cost of option spread is .26, with potential upside of .74 (figured as the difference between 5.20-4.20 of 1.00, less the spread cost of .26. So, 1.00 – .26 = .74.) Adding this to the 4.30 HTA puts a ceiling at 5.04, less basis.
The floor price is 4.04, figured as 4.30 less the spread cost of .26.
Note that all of these are figured before basis is set. Basis @ GPC is currently -.17 for October 2021 delivery.
