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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsFarmer’s Daughter Haugerud Reaps Riches on Drought-Struck Corn
http://www.bloomberg.com/news/2012-09-19/farmer-s-daughter-haugerud-reaps-riches-on-drought-struck-corn.htmlRenee Haugerud, founder and chief investment officer of Galtere, has led her New York-based hedge fund to gains with a spring bet on corn futures.
For three excruciating weeks in May, Renee Haugerud, the founder of New York hedge fund Galtere Ltd., agonized that her wager on corn was a massive mistake.
She had started buying in March, when futures contracts averaged about $5.59 a bushel, expecting steady to rising demand from ethanol refiners and feedlots to boost prices. Instead, on May 10, the U.S. Department of Agriculture reported record planting and forecast a bumper crop. Prices began a 12 percent slide for the month. Other hedge funds bailed.
Haugerud, 57, the daughter of a part-time farmer, fought the temptation to join the crowd, Bloomberg Markets magazine reports in its October issue. Instead, she and her team got to work. They rechecked past corn yields and plowed through ethanol production and export numbers to reconfirm their calculation of strong demand for a so-so crop.
The U.S. Environmental Protection Agency bolstered their case in April when it raised the limit for ethanol in gasoline to 15 percent from 10 percent for cars made after 2001, later aiding the buying Haugerud had forecast. As for supply, Haugerud thought the USDA was overoptimistic in its harvest prediction. If farmers were planting in amounts not seen since 1937, her farm upbringing and commodities experience told her they were tapping marginal land. This all didnt add up to a corn bonanza.
Tansy_Gold
(17,847 posts)"a part-time farmer."
Viva_La_Revolution
(28,791 posts)Tansy_Gold
(17,847 posts)farmed a small family farm in Indiana, sometimes raised some young beef cattle, but mostly soybeans, corn, and alfalfa hay. Even when he worked another full-time job -- as a carpenter or a butcher or whatever -- farming was still a full-time job. And a full-time worry, too.
Methinks the case in this article is someone who bought a farm and hired help to farm it and didn't even live on the property, but drove out occasionally to look at it. . .. . and collected all the profits.
Don't get me started.
Brickbat
(19,339 posts)Javaman
(62,504 posts)she sounds like such a sweet person
AngryAmish
(25,704 posts)You may not like it or understand it but without futures then food would be very cheap now - impoverishing farmers - and very expensive in spring - causing starvation.
Without futures we don't have grain elevators, frozen food and all that.
Without speculators such at this person there is not enough liquidity in the system to make it work.
kestrel91316
(51,666 posts)and the taxes should probably be directed back toward helping farmers.
AngryAmish
(25,704 posts)Or ice hockey players?
What makes them special?
kestrel91316
(51,666 posts)and organic producers subsidized instead of giant corporate megafarms, which is the way it is now.
Hairdressers are only marginally useful. Ice hockey players are not useful to society in any meaningful sense of the word.
Romulox
(25,960 posts)for "modern society" to function?
AngryAmish
(25,704 posts)However anyone who thinks about it should figure out that agricultural futures are absolutely a good thing.
Zalatix
(8,994 posts)TheMadMonk
(6,187 posts)snooper2
(30,151 posts)Got a creek or well for continual fresh water?