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CRUSH SPREAD Definition & Legal Meaning

Definition & Citations:

A SPREAD in the GRAINS market reflecting the price differential between soybeans (as feedstock) and soybean oil or soybean meal (the two main byproducts); the spread can be traded through a single FUTURE or OPTION contract on certain EXCHANGES. A hedger or speculator can buy the crush spread (e.g., purchase soybeans and sell oil or meal) to take advantage of positive margins, and sell the spread (e.g., sell soybeans and purchase oil or meal) to profit from negative margins.


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