It is a fundamental principle of tax law that hedging a commodity produces ordinary gains and ordinary losses, with the futures’ gains or losses treated just like gains and losses from the commodity involved.1 Likewise, gains from speculative transactions are treated as capital gains; losses are reported as capital losses.2
Harl, Neil E.
"Hedging or Speculation: Watch Who Does the Hedging,"
Agricultural Law Digest: Vol. 15
, Article 1.
Available at: http://lib.dr.iastate.edu/aglawdigest/vol15/iss2/1