Wheat Corn spread in the Cash and CME from a U.S domestic point of view Part I

Sell richness, Buy cheapness like a Merchant of Cargill does. Continue reading

Cargill: A Glimpse into the History of Hedging

The most recent accounts of “hedging” occurred in the mid-1800s, even though there is historical evidence that attempts to “hedge” happened well before. In the mid-1800s, Chicago became a commercial center of industry, a focal point where people from across the Midwest came together from a network of rail lines. Farmers were selling grain to buyers who would then ship their grain all over the U.S.

Farmers would produce grain during the spring and summer, and come to the center of trade (Chicago) at the end of the summer to sell it. More often than not, a number of dealers would then offer a price to secure those purchases for a limited amount of grain.

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Gulf-Brazil Soybeans & the CME price feedback loop Part I

The Soybean market is trying to tell us something Continue reading