Specifically, traders don't intend to buy a physical commodity with the right price, but to ensure that the price of the physical commodity can still be maintained at a certain level in the future, so buying hedging can be applied. On March 26th, the spot price of soybean meal per ton 1980 yuan. A feed enterprise decided to hedge soybean meal in Dalian Commodity Exchange in order to avoid the possible spot price increase in the future and thus increase the cost of raw materials. At this time, the August contract price of soybean meal futures was per ton 1.920 yuan, and the basis was 60 yuan/ton, so the company bought soybean meal August contract 10 lot in the futures market. On June 2nd, I bought 100 tons of soybean meal at the price of 2 10 yuan per ton in the spot market, and sold the June soybean meal contract10 lot at the price of 2040 yuan per ton in the futures market to hedge long positions. Judging from the basis, the basis has expanded from 60 yuan/ton on March 26th to 70 yuan/ton on June 2nd.
Transaction: March 26th spot market: spot price of soybean meal 1980 yuan/ton; Futures market: Buy August soybean meal 10 contract at the price of 1920 yuan/ton. The base price is 60 yuan/ton. Spot market on June 2: the price of buying 100 tons of soybean meal is 2 1 10 yuan/ton; Futures market: soybean meal contract sold in August 10 lot: the price is 2040 yuan/ton. The base price is 70 yuan/ton.
Arbitrage results: spot market loss 130 yuan/ton, futures market profit 120 yuan/ton, * * * loss 10 yuan/ton.
Net loss:100×130-100×120 =1000 yuan.
Note: 1 hand = 10 ton.
In this case, both the spot price and the futures price rise, and the profit in the futures market largely offsets the losses caused by the spot price rise. Feed enterprises have achieved good hedging effect, effectively preventing the risks brought by rising raw material prices. However, because the increase of spot price is greater than that of futures price, the basis is enlarged, which makes the loss of feed enterprises buying spot in the spot market greater than that of selling futures contracts in the futures market, and they still lose 1000 yuan after breakeven. This is caused by unfavorable changes in the foundation and is normal.
Similarly, if the prices in the spot market and the futures market fall instead of rising, then the processors will make profits in the spot market and lose money in the futures market. However, as long as the basis is enlarged, the profit of the spot market can't completely make up for the loss of the futures market, and there will be a net loss.