. Around here one elevator is pushing futures-first contracts and that worked for a couple of years(on wheat in particular), but lately they don't seem to get to agressive on basis...I guess they have you so what can you do? I felt from the start this may have been a trap, just took them a couple years to set the trap! So for this reason(and others) I am looking at getting a hedge account going again and doing my own risk management that keeps me open on who I can haul to. Something we used to do but it takes time and capital to manage. Might be worth it again.
I think the futures only work best if uptake in a given area is low, so they cant screw around with basis too much. that being said I like them better than basis only.... with futures you have locked in give or take 90% of the crops value and only are exposed to fluctuations on 10 %, we got absolutely pasted on Nexera canola several yrs ago bc the "premium" was just a good basis contract. price tanked close to delivery date and grain still had to go in. rolled it into an even worse market watched things get even worse. finally delivered about 2 weeks bf market rallied to avoid another roll. if no basis contract could have delivered earlier or later.......
I might have this wrong bc its been a few years, but it was once explained to me that if I had a hedgeing account I could sell wheat / canola futures and hold until close to delivery, and then shop around for best basis and then swap an elevator's buy futures. it think it was called an EFP contract.