An analysis of preharvest soybean marketing strategies in louisiana using forward and futures contracts

Abstract

The purpose of this article is to analyze forward and futures contracts as preharvest soybean marketing alternatives. The effects of location, fraction of the crop contracted, and date of contract are examined. Results indicate that both forward and futures prices perform better than cash sales at harvest. In general, forward and futures price distributions had higher means, lower variances, and higher miniium values relative to cash sale at harvest. Only minor differences were observed across locations.