you are a purchasing manager for Chipotle and you need to forecast the price of the commodity, rice, in 1 year from now. This commodity exists on an exchange and is reported daily in a news source. Foreign exchange rates may be an important consideration. Your organization needs five-million dollars worth of sugar for delivery, in a year. Important, open and read the information on How to find commodity price . Here is a link for rice prices http://www.indexmundi.com/commodities/?commodity=rice

Please address the following (in this order and delineate each answer):

1.The current spot price for the commodity based on what quotation and the minimum amount of purchase required.

2. The current Futures price for the commodity based on what quotation.

3. The Spot price you forecast for the commodity in one year and why.

4. Based on your forecast, your recommendations (buy now/later? Hedge, delay purchase, forecasted savings with recommendation).

5. Why might a buyer wish to hedge a commodity purchase?

6. Does hedging remove all risk?