Agriculture Workshop: Risk Management
Posted by teen (+95) 11 years ago
Agriculture workshop will review strategies to protect revenue

Agricultural prices have been relatively volatile in the last few years. MGE spring wheat prices declined by about $3.50 per bushel from early spring through September of 2009. This time period also saw CBOT corn decline approximately $1.50 per bushel, CBOT wheat declined approximately $2.25 per bushel and KCBT winter wheat declined approximately $2.75 per bushel. Production risks also cause problems and calendar years 2009 and 2010 saw distinct changes in historic basis values for different types and protein levels of wheat which reflected poor growing conditions in those years. Prices for small grains have now rebounded to relatively high levels and livestock prices have shown very good strength, rebounding about $20 per Cwt. In 2010.
Both local and global markets have contributed to these prices swings. Producers will have an opportunity to learn about various strategies to protect their revenue stream using new insurance tools for grains, livestock, pasture and forage, new government programs and the Futures and Options markets. Each workshop will provide a review of the new Combo insurance policy for small grains; the relatively new Rainfall Index (RI) insurance for rangeland, pasture and hay; Livestock Risk Protection (LRP), a relatively new insurance product for beef producers which allows insuring everything from calves to fat cattle and also provides insurance for dairy, lambs and swine. LRP insurance coverage could have been purchase on November 30, 2010 for 6 to 9 Cwt animals that would be ready the end of April 2011 for prices ranging from $116.00 to $108.00. Winter wheat could have been insured prior to the sales closing date of September 30th, 2010 for $7.15 per bushel based on the RMA Projected Harvest Price. The $7.15 was an average of futures prices prior to the sales closing date, but the KCBT futures have trended up and are currently trading around $8.20 per bushel. What can be done now to help capture the higher prices currently being offered by the markets, even if you purchased insurance? What if I forward contract this spring, but end with very low yields? Is there a strategy to cover the risks of forward contracting and how can it be incorporated into my overall risk management strategies. Since the new Combo Policy Plans are based on the futures and options markets, is it cheaper to use these markets rather than buy insurance? These are some of the questions that will be answered during these workshops.
Protection levels offered by insurance plans for crops and livestock will be compared to levels available in the commodities markets. In addition the use of multiply levels of price, yield and revenue protection strategies will be explored using combinations of insurance plans and the commodities markets. New government programs that help provide safety nets for producers will also be reviewed.
Miles City is scheduled to have their exciting workshop January 28 starting at 10 a.m and will be located in room 313 at the Miles City Community College. Plans for crop insurance will kick things off, a break for lunch will be at 12:00 p.m. and lunch is hosted by Northwest Farm Credit services. We will then start up the second half around 1:30 p.m. focusing on insurance plans for livestock finishing up at 4:00 p.m.
Please sign up for a lunch head count at deadline on the 27, contact Custer County Extension 874-3370.
Posted by atomicg (+1012) 11 years ago
Who are the presenters?