What Is the Significance of the Basis for a Trader Using Futures for Hedging?

For a hedger, the basis is the primary risk. The hedger's goal is to lock in a future price for their asset, and they use the futures contract to achieve this.

Basis risk is the risk that the spot price and the futures price do not converge as expected at expiration. If the basis changes unexpectedly, the hedge will be imperfect, and the hedger's final realized price will deviate from the intended price.