It is possible for a farmer to enter into a forward contract with a bank where he /she locks-in a price for his/her grains for the upcoming season.

Question

Quizplus · Accepted Answer

A forward contract is a financial instrument that allows parties to lock in a price for a transaction that will occur at a future date. Farmers often use forward contracts to lock in prices for their crops with various buyers, including banks that offer these services through their commodity trading or agricultural financing divisions, to hedge against price volatility.

It Is Possible for a Farmer to Enter into a Forward