Margin used 20.25 cents. Note-another 8.25 cents margin required. If the market rallies, the increase in value in the call sold is a manageable risk. For grain under loan and the potential for the PCP to drop, you can, in a sense, achieve the first step of locking in the cash price via the put. The 2 nd step is then to pay off the loan or lock in the PCP at the reduced level.
Net impact is to create a gain over loan.
If you have taken the LDP, you set the same current floor and you can buy some time. Prefix and Explanation is after technical tables. Crop Close3-19 Price Chg. MGE May Wheat closed 3.20. Corn-Based on May 01.