If you were risk-averse then you must use forward selling methods to hedge against production or inventory. Research on this show that there is inconsistent results with respect to relationship between risk aversion and the use of forward selling of product.

It is good to stay on safe side.If you sell forward the average total produced, then in any situation you can sell the forward .If you are uncertain about the spot price at production time and the eventual size of the production then you must sell forward by hedge against price risk. Regression results showed that more risk averse farmers are forward pricing a larger proportion of their crop produce. The main conclusion from this research is that the relationship between farmers risk aversion and the quantity of maize forward priced is consistent with expected utility theory in spite of the fact that farmers needs to be less risk averse to adopt forward pricing.

It is advisable , never sell forward more than the minimum amount produced, or don’t sell forward more than the maximum or less than the minimum produced because The quantity decision is modelled conditional on the adoption decision to ensure that the modelling procedure does not force the same variables to influence the two decisions in the same way and also forward pricing behaviour found inconsistent results with respect to the relationship between risk aversion and the use of forward pricing methods.