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An Oklahoma State University analysis explains that wheat value is set by the KC futures contract plus or minus the local basis. The December KC contract was $5.30 and the Burlington, Oklahoma basis was minus 10 cents, with protein levels well above average.
The article says quality factors drive basis more than transport costs.
Protein and quality premiums move wheat's cash value for feed and milling buyers, so basis matters as much as the futures price.
farmprogress.comKim AndersonSep 6, 2018Not enough comparable past events yet for a historical read.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
