University of Minnesota Extension

Winning the Game   Tool Time

Tool Time for Pre-harvest Marketers

What pricing tools are available to grain marketers before harvest? This workshop will use the example of a pre-harvest plan for corn in 2007 to illustrate the pros and cons of six different pricing tools: forward contracts, selling futures contracts, hedge-to-arrive contracts, buying put options, forward contracting and buying call options, and selling calls to form a price window. Once they develop a better understanding of the tools, your customers will be invited to “test drive” these tools in a fastpaced and realistic marketing game. The simulation game not only helps us with the tools, it reinforces valuable lessons learned in “Winning the Game: Launch your Pre-harvest Marketing Plan.”

 

Featured Celebrity Producer

Darla Discipline

She uses a combination of price objectives and decision dates when marketing her grain.