Preparing for USDA report

New for traders

Short-term volatility and event risk drives growth in Ag options

On June 30th the U.S. Department of Agriculture (USDA) will release its annual Acreage Report providing market participants with statistics on the crops planted in 2014. This report’s history of sparking dramatic price movements’ has all market participants focused on grains in the last week of June.

Whether you are looking for a cost effective way to hedge risk or a way to access the short-term volatility associated with these reports there are products to help you manager risk and take advantage of short-term volatility.

Legendary market analyst David Hightower will be holding an advanced trading workshop to discuss speculative trading Strategies ahead of USDA report on June 19 at 2:30 (CDT) at the Chicago Board of Trade.

Hightower will discuss how short-dated New Crop (SDNC) options and weekly options can offer a more precise way to trade in front of important agricultural reports. These products have become a popular tool used by both hedgers and speculators leading up to these reports.


Short Dated New Crop Options:

  • 1.9 million contracts to date (first introduced in 2012)
  • 163,863 Short Dated New Crop contracts traded in the two weeks leading up to the 2013 Acreage report, including a record 38,832 contracts the day before the report. 
  • 2014 ADV of 5,346, up 20% vs. the same period last year. 
  • If this YoY trend continues, we could see a major surge in volume leading up to June 30.


Weekly Options:

  • Weekly options traded 24,712 contracts on 3/31/2014 which was the last major USDA Report
  • Leading up to the March USDA number, Weekly options averaged 5,766 contracts per day
  • 2014 ADV is 2,704 contracts, up 34% vs. the same period last year


Click here to register:


comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome