Johanna is grain farmer in Grand Island, NE. Last fall, she decided to sell her corn before harvest for delivery in March 2023. On August 1, 2022 shesold her grain using futures contracts for March 2023 delivery. She locked in a futures price of $6.16/bu.Then, in March 2023 she delivered her grain, offset her hedge, got paid and was done with her corn harvested last year.

Now, after she delivered her grain in March 2023, her friend told her that she should have rolled her hedge forward to May 2023 delivery. According to her friend, she would have made more money if she had rolled her hedge. In fact, Johanna would have no problem in waiting until May 2023 to deliver her grain and get paid, as long as she had the opportunity to obtain a higher price at the end of the hedge. She just didn't consider doing it.

Let's see if her friend was right, i.e. let's see if Johanna should have rolled her hedge forward from March 2023 to May 2023 delivery.

Here's the information that you need about the corn futures market and Johanna's cash market

[a] The chart below shows corn futures prices for March 2023 delivery (orange line) and May 2023 delivery (blue line) between 8/1/2022 (which was the day Johanna started her hedge) and 3/14/2023 (which was the last trading day for the futures contract for March 2023 delivery). Futures prices are in $/bu.