Create a free Feed & Grain account to continue reading

Brazil Grain Grower Using Derivatives to Reap Trade War Gains

Terra Santa has sold more than 50% of new-crop soybeans through complex derivatives

Stock exchange 680583 960 720

Listed Brazilian grain grower Terra Santa Agro has stepped up use of complex derivatives to defend positions and potentially profit from commodity price volatility amid a global trade war, Chief Executive Officer José Teodoro Junior says.

Terra Santa is using “collar options” and “accumulator” contracts whereas last year the use of soy and cotton futures was a more prevalent form of hedging, Teodoro told Reuters.

This way, the company can avert the risk of “a mismatch” related to futures prices and the so-called basis premium risk, he says.

According to a report the report at Reuters, one of the largest grain growers in Brazil with annual sales of about $192 million, Terra Santa has sold more than 50% of new-crop soybeans through complex derivatives.

Page 1 of 281
Next Page