- A Primer on
Using Futures and Options in Grain Marketing
Paul Patterson and Larry Makus, University
of Idaho Cooperative Extension Service, December 1998
This presentation provides a basic introduction to the terminology and concepts associated with trading futures contracts and options on futures contracts. The presentation focuses on basic futures trading terminology, the idea of opening and closing (by offsetting) a
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- A Primer
on Using Futures and Options in Grain Marketing - PowerPoint Slides
Paul Patterson and Larry Makus, University
of Idaho Cooperative Extension Service, December 1998
This presentation provides a basic introduction to the terminology and concepts associated with trading futures contracts and options on futures contracts. The presentation focuses on basic futures trading terminology, the idea of opening and closing (by offsetting) a
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- Basis
Forward Contracts
Clement E. Ward, Oklahoma State University and Stephen R.
Koontz, Colorado State University; 2002
Many cattle feeders are interested in pricing fed
cattle with a basis forward contract and most packers will provide basis
bids at feeders' requests. This extension fact sheet describes the forward
contracting process and identifies advantages, disadvantages, and issues .
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- Basis: The
Cash/Futures Price Relationship
Kevin C. Dhuyvetter, Kansas State University Research & Extension,
November 1992
Farmers today have more marketing alternatives than in the past and
face a complex marketing system.
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- Buying Hedge with
Futures
James D. Sartwelle, III , Edward Smith, Terry Kastens and Daniel
O’Brien, Texas Agricultural Extension Service, April 1998
Many bulk purchasers of agricultural commodities require price risk
management tools to help stabilize input prices.
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- Buying Hedge
with Futures (Curriculum Guide)
Texas Agricultural Extension Service, April 1998
Goals and Objectives: (1) understand the steps of implementing a
successful buying hedge. (2) understand how buying hedges can help manage market price
risk in advance of actual cash purchases.
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- Cross Hedging Agricultural
Commodities
Jennifer Graff, Ted Schroeder, Rodney Jones and Kevin Dhuyvetter, Kansas
State University Research & Extension, Septemeber 1997
Many agricultural commodities do not have an active futures market.
One alternative is to cross hedge, that is, hedge the cash commodity in the futures market
of a different commodity.
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- Cross Hedging Cull Cows
Jennifer L. Graff, Ted C. Schroeder, and Rodney D. Jones, Kansas State
University Research & Extension, April 1997
Currently there is no futures market in which to directly hedge cull
cows. One alternative is to use live cattle futures as a cross hedge.
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- Deferred Price Contract
USDA, Risk Management Agency, September 1997
A deferred price contract provides the seller the opportunity to
deliver and transfer ownership on the contract date, but without setting a sales price.
The buyer generally charges an up front or monthly fee.
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- Delivering
Slaughter Hogs On a Live Hog Futures Contract
Allen C. Wellman, University of Nebraska Cooperative Extension, May 1992
Although most hedgers do not actually make delivery on a live hog
futures contract, it is the threat of delivery that makes hedging an effective market risk
reduction technique.
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- Factors
Affecting the Basis for Feeder Cattle
DeeVon Bailey, Utah State University; C. Wilson Gray,
University of Idaho; and Emmit L. Rawls, University of Tennessee; 2002
Basis is one of the most useful concepts in
developing market strategies for agricultural commodity markets. Basis
information is a critical part of forward pricing and spot market
decisions and forecasting basis is an essential element when one is making
these types . . .
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- Futures and
Options: Graphically Speaking
Jevub NcBew, Maryland Cooperative Extension Service, 1997
Futures and options contracts are valuable tools for farmers. Through
their use, farmers can potentially increase the price received for their products while at
the same time reducing price risk.
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- Futures and
Options Terminology
Derrell S. Peel and Roger V. Sahs, Oklahoma Cooperative Extension Service
This fact sheet provides marketing terms and definitions critcal to
understanding agricultural futures and options.
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- Futures Contracts
USDA, Risk Management Agency, September 1997
Provides a very simple explanation of what is a futures contract.
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- Futures Market - Basics
Gene E. Murra, South Dakota State University, 1996
One technique which can be used to manage the price risk is the futures market.
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- Futures
& Options What You Should Know Before You Trade
Commodity Futures Trading Commission, January 1997
The purpose of this brochure is to provide you with general
information about trading commodity futures and options and to encourage you to ask more
questions and gather more information before you open an account.
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- Hedging
Cull Sows Using the Lean Hog Futures Market
Kevin Dhuyvetter, Jennifer Graff, and Ted Schroeder, Kansas State
University Research & Extension, June 1998
Because cull sows represent such a small portion of total income,
managing price risk associated with cull sows is often overlooked.
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- Hedging
Milk with BFP Futures and Options
David Anderson, Dean McCorkle, Robert B. Schwart, Jr. and Rodney Jones,
Texas Agricultural Extension Service, December 1998
BFP (Basic Formula Price) milk futures and options can be used to
hedge, or lock in, milk prices in order to manage milk price fluctuations.
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- Hedging with Grain
Futures
Kevin McNew, University of Maryland
By using grain futures contracts, you establish a forward price for
your crop. This may can be done anytime anytime prior to when you expect to sell grain in
your local cash market.
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- Hedging with Wheat Futures
Minneapolis Grain Exchange, October 1998
This presentation describes basic concepts in hedging with wheat
futures.
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- Hedging Using
Livestock Futures
James D. Sartwelle, III, Texas A&M University and James
Mintert, Kansas State University; 2002
Livestock producers are sometimes faced with
advantageous pricing opportunities prior to the time grain or livestock
will be bought or sold in the cash market.
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- How Cash
Price and Basis Affects Hedging Outcomes
Paul Patterson and Larry Makus, University
of Idaho Cooperative Extension Service, December 1998
This presentation provides an introduction to the hedging concept using both futures and options. The focus is on understanding hedging as the process of being involved in two markets simultaneously, so price outcomes are impacted by what happens to both markets.
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- How Cash
Price and Basis Affects Hedging Outcomes - PowerPoint Slides
Paul Patterson and Larry Makus, University
of Idaho Cooperative Extension Service, December 1998
This presentation provides an introduction to the hedging concept using both futures and options. The focus is on understanding hedging as the process of being involved in two markets simultaneously, so price outcomes are impacted by what happens to both markets.
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- Introduction to
Futures Markets
James Mintert, Mark Waller and Rob Borchardt, Texas Agricultural Extension
Service, December 1998
A futures contract is a binding agreement between a seller and a buyer
to make (seller) and to take (buyer) delivery of the underlying commodity (or financial
instrument) at a specified future date with agreed upon payment terms.
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- Introduction
to Hedging with Wheat Futures and Options Workbook
Minneapolis Grain Exchange, October 1998
This workbook provides the framework for a basic "hedging with
futures and options" presentation. It includes definitions of futures, options and
hedging terms that lead up to futures and options hedge examples.
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- Profit Farms
Wheat Marketing Case Study: Version 1.2
Paul Patterson and Larry Makus, University of
Idaho Cooperative Extension Service, December 1998
The objective of the marketing case-farm exercise is to allow participants to use alternative cash-based and futures-based wheat pricing methods and to evaluate the effectiveness of these pricing alternatives as a risk management tool under varying market conditions.
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- Selling Hedge with
Futures
James D. Sartwelle, III , Edward Smith, Terry Kastens and Daniel
O’Brien, Texas Agricultural Extension Service, April 1998
A selling hedge involves taking a position in the futures market that
is equal and opposite to the position one expects to have in the cash market, so one is
covered (subject to basis risk) against price declines during the intervening period.
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- Selling
Hedge with Futures (Curriculum Guide)
Texas Agricultural Extension Service, April 1998
Goals and Objectives: (1) understand the steps of implementing a
successful selling hedge. (2) understand how selling hedges can help manage market price
risk in advance of actual cash sales.
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- Understanding
and Using Feeder and Slaughter Cattle Basis
James Mintert and Kevin Dhuyvetter, Kansas State
University; Ernest E. Davis and Stan Bevers Texas A&M University; 2002
Basis is defined as the difference between the local
cash market and a futures contract price (Basis = Cash Price - Futures
Price). Knowledge of historical basis patterns can be helpful when
estimating expected sale or purchase prices at the conclusion of a futures
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- What are Futures Markets?
Kevin McNew, University of Maryland
In a nutshell, futures markets are nothing more than auction markets
for forward contracts, except in futures markets they are called futures contracts.
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