To lock in price or wait

[Jonescattleco]

I have a group of 90 heifers that will weigh 550-575 in April and dont know whether i should lock them in now or wait and see what this crazy market does what would you do?

 

[inbredredneck]

I'b put them now, if you can make money now. Nothing to lose everything to gain by putting, if you do nothing you have everything to gain and everything to lose. A no brainer in my opinion.

 

[highgrit]

I would wait if it was me. Historically spring is the highest market. It's easy to gamble with other peoples money.

 

[jedstivers]

I'd get a floor under then, it will cost a little to do that but you know your bottom side and still have the top side to take if it goes up.

 

[inbredredneck]

I would wait if it was me. Historically spring is the highest market. It's easy to gamble with other peoples money.

Why would you gamble losing a gauranteed profit? Also you may want to look back into the history of feeder cattle prices as well, spring historically does not provide the highest markets.

 

[Jonescattleco]

Jed how exactly does that work. In the past i have always waited til a week or two before im ready to sell and contact my buyers but with the market as crazy as it is im not sure if thats the best route to take this year

 

[larryshoat]

I would wait if it was me. Historically spring is the highest market. It's easy to gamble with other peoples money.

Why would you gamble losing a gauranteed profit? Also you may want to look back into the history of feeder cattle prices as well, spring historically does not provide the highest markets.

You're kidding, right?

Larry

 

[larryshoat]

I'd get a floor under then, it will cost a little to do that but you know your bottom side and still have the top side to take if it goes up.

That's good advice Jed, it will cost a little but as crazy as everything has been will make sleeping at night a lot easier.

Larry

 

[inbredredneck]

I would wait if it was me. Historically spring is the highest market. It's easy to gamble with other peoples money.

Why would you gamble losing a gauranteed profit? Also you may want to look back into the history of feeder cattle prices as well, spring historically does not provide the highest markets.

You're kidding, right?

Larry

No I am not kidding at all.

 

[Massey135]

I'd get a floor under then, it will cost a little to do that but you know your bottom side and still have the top side to take if it goes up.

That's good advice Jed, it will cost a little but as crazy as everything has been will make sleeping at night a lot easier.

Larry

+1

 

[jedstivers]

Jed how exactly does that work. In the past i have always waited til a week or two before im ready to sell and contact my buyers but with the market as crazy as it is im not sure if thats the best route to take this year

I think it's a put that you will buy, ask a broker. I'm running someone else's calves now, if I ever buy my own I'll buy a floor under them when I buy them.

 

[inbredredneck]

Jed how exactly does that work. In the past i have always waited til a week or two before im ready to sell and contact my buyers but with the market as crazy as it is im not sure if thats the best route to take this year

I think it's a put that you will buy, ask a broker. I'm running someone else's calves now, if I ever buy my own I'll buy a floor under them when I buy them.

Thats right Jed. An April $156 will cost right at $3.37 cwt.

 

[Jalopy]

I haven't used puts for a while but if you have an April put won't it expire in mid March? Maybe look at a buying June put. That way it won't expire until after the calves are sold and maybe that there would be some cash value left in the put to realize also. Don't forget about the basis from his location and Chicago also. But it would allow for a floor if this market stays so unstable. JM2Cents

 

[inbredredneck]

I haven't used puts for a while but if you have an April put won't it expire in mid March?

Expires the last Thursday of the contract month.

Maybe look at a buying June put.

There isn't one.