The risk from weather and debt is just about all the risk they can afford. The 1980s farm financial crisis vividly illustrated what happens when you can't pay off the money you've borrowed to buy land, machinery, and crop inputs. Even 10 years later, bankruptcy, foreclosure, and the loss of the family farm remain powerful warnings of the risks of leverage. Whether it's stored grain or the crop you'll plant in the spring, not having price protection puts you at risk. If prices fall, your revenues also fall.
Some farmers can afford to take a lot of price risk.
Farmers with little debt and strong earnings can wait until prices rally to sell their production. By taking a lot of price risk they may increase the ultimate rewards they coax from the market. But most farmers don't have the luxury of waiting for the market. The risk from weather and debt is just about all the risk they can afford to take. Fortunately, there are plenty of ways to reduce price risk.