Minimum Price Contract

Risk - Minimal, as the producer knows the cost up front to enter into the contract.

Reward - Moderate, as options bought will not follow futures prices tic-for-tic.

Use when:

• Producers need to sell grain for cash flow needs, but the market shows upside potential
• Basis is relatively good
• Calculated price is above loan rate
• Futures prices are good

Fees: $.05/bu

Calculations Example:

The cost will be deducted from the producers grain check at the time of writing. In the event a producer wishes to "Minimum Price" a prior grain sale, they will be required to pay the total cost upon entry into the option position.