AREC
412 - Agricultural Commodities Marketing - Material
Announcements
On-campus students: deadlines for assignments are posted with that assignment.
Online students: adhering to the assignment deadline is appreciated and
needed. The absolute deadline is the day
the assignment is returned, reviewed in class, and that lecture is posted to
ECHO360.
Communication
Protocol
When you send me an email please make sure the subject line leads with
AREC 412:... and provides a topic.
All
students on-campus and online please read the following:
If you need to email me an attachment then please do the following. Use the following file naming convention, AREC 412 AssignmentName&Number
YourLastName.
For example, Quiz 3 becomes AREC
412 Quiz 3 YourLastName.pdf. (Please dont send me a document named, for
example, Quiz 3.pdf.)
...
WSJ Reading Suggestions...
The link to the WSJ website to sign-up for the paper is below. It is unique to AREC 412 so Ill know when
you subscribe.
Use this link: https://r.wsj.com/PROFc7nt
Again, this is the unique link for AREC 412 at Colorado State University and
the reading the WSJ is required so please use it.
...
Extension Travel/Meeting Days
these are potential Class Cancelled Days
During the Fall Semester I have a predictable set of meetings where I deliver
market outlook and market policy research to extension audiences. If I need to then I will cancel class
meetings and record a makeup video. Look
for those on Canvas and in ECHO360. Some
of my meeting may be virtual and those may be through the afternoons. If the meeting is during class then I will
cancel the class meeting and record a make-up video.
August 29-30 (T&W) 5 Rivers Applied Academy of Agribusiness Management
ARDEC Fort Collins, CO I should be back by class so likely no class meeting
impact.
October 3-5 (W&R&F) USDA AMS and DFA milk marketing order testimony
2 cancelled classes.
October 5 (F) Denver, CO @ Colorado Department of Agriculture Outlook
Committee Meeting virtual if I am traveling.
October 9-11 (M&T&W) Monte Vista & Rocky Ford, CO @ Ag Lender
Meetings & Producer Workshops 2 cancelled classes.
October 17-18 (T&W) Akron, CO @ Ag Lender Meeting & Colorado Crop
Insurance Meeting 1 cancelled class
October 24-25 (1-4 PM & 1-4 PM) Denver, CO @ Industry Outlook Conference
likely virtual so likely no class impact
October 30-31 November 1 (M&T) Springdale AR @ Cattle and Beef Markets
University Proposal Meeting 1 cancelled class & I should be back by class
Wednesday
...
Syllabus and Survey
AREC 412 Syllabus - 8/21
Overhead Materials
AREC 412 Lecture A
Introduction - 8/21 (If I update material then Ill put a new date on
it.)
AREC 412 Lecture B
Institutions 8/21
CBOT Corn Futures Price Quotes
notice the time & settlements were found in class
CME Rulebook Chapter
101 & Chapter
102 These are resources only so do not print them.
CME Products Traded
AREC 412 Lecture C
Price Discovery 9/6
dlr
08-17-2023 dlr
08-22-2023 August 2023 Cattle on Feed
Report discussion pre-report & post-report discussion
06-31-2023 June 2023 Acreage Report briefing for the
Secretary of Ag find the page with the pre-report & post-report visual
dlr
06-27-2023 dlr
06-30-2023 June 2023 Hogs and Pigs
Report discussion pre-report & post-report discussion.
06-30-2022 March 2023 Prospective Plantings Report
briefing for the Secretary of Ag find the page with the pre-report & post-report
visual
dlr 07-02-2019 June 2019 Acreage Report discussion
pre-report & post-report in same newsletter The report in 2019 is a good
teaching example.
dlr 04-01-2019 March 2019 Prospective Plantings Report
discussion pre-report & post-report in same newsletter
TBR-Feb TBR-Mar TBR-Apr TBR-May TBR-Jun TBR-AugComments TBR-Aug The Brock Report offered good discussion
& summary of the grain market surprises that year.
dlr 06-30-2015 dlr
07-01-2015 June 2015 Acreage
Report Discussion The 2015 report was a very good teaching example.
Follow your WSJ. General economic news is discussed, for
example GDP. Usually, actual numbers are
compared to expectations and the stock market usually reacts accordingly...
Find the CMEs Federal Funds futures
quotes for 2023-09-08 & determine how far up interest rates are going to
go.
Find the CMEs Crude Oil futures
quotes for 2023-09-08 & determine the long-run price of oil.
AREC
412 Lecture D1 Forward Pricing & Measuring Risk 9/11
AREC 412
Lecture D2 Forward Pricing & Measuring Risk 9/13
Top
Producer The tale of two tails.
Old article with good ways to think about risk.
Go to the NOAA and find the hurricane
track forecast maps. If theres no
active hurricane then look in the archive.
(If you find a map with a sharpie line then youre in the wrong place.)
CBOT Corn Prices Go to the CME
Group website and look up the corn prices for the next several harvest years.
KCBOT Wheat Prices Do the same for
hard red winter wheat.
CME Crude Oil Prices Do the same
for crude oil. What is a good long-run
oil price?
CME Live Cattle & Feeder Cattle
Prices What does the market think cattle prices will do?
AREC 412
Lecture E Basis & Basis Risk 9/18
AREC
412 Lecture F Grain Basis & Yield Risk 9/22 9/29
AREC
412 Lecture G Livestock Basis & Hedging Summary 10/2
Hedging
with Futures and Options Examples Spreadsheet 10/16 to be reposted
This spreadsheet does many of the
hedge calculations for a decision maker and allows the user to examine
but-what-if questions.
End of material for Exam 1.
AREC 412
Lecture H Fundamental Analysis: Motivation & Nonstorable Commodities
- 10/13
USDA
Cattle on Feed Report
USDA
Livestock Slaughter Report
USDA
ERS Livestock & Dairy Outlook
Cattle-Fax
Trends & Cattle-Fax
Update
AREC 412 Lecture I Fundamental
Analysis: Storable Commodities - 10/25
USDA
World Agricultural Supply and Demand Estimates (WASDE) Report
USDA
Crop Production Report & USDA Crop
Progress Report & Crop Progress
prior week
USDA
ERS Feedgrain Outlook, USDA ERS Oil Crops
Outlook, & USDA ERS Wheat Outlook
AREC 412 Lecture J
Technical Analysis: Summary - 11/17
End of material for Exam 2.
AREC 412 Overheads O 12/4
Example Options Calculations and
Graphs Spreadsheet 12/
Options Script
Hedging with Futures and Options
Examples Spreadsheet reposted above
AREC 412 Overheads Z
Handouts
Handout - Mark to the Market 8/28
Handout - Risk and
Return Figures 9/11
Handout -
Risk and Expectations Figures 9/11
Handout - Wheat Basis Tables 9/18
Handout - Wheat Transportation
Costs 9/18
Handout - Wheat
Storage Costs, Seasonal Price Improvement & Basis Table Figures 9/18
Handout
- Cattle Basis Tables 10/2 do not print
Handout - Cattle Transportation
Costs 10/2
Handout - Cattle
Basis Figures & Calculations 10/2
Handout - Forecast Live Cattle
Futures 10/16
Handout - Forecast Feeder
Cattle Futures 10/23
Handout -
Cattle & Beef Markets Information - 10/27
Handout - Grain Balance
Sheet Tables & Figures 10/27
Handout - Technical Analysis Tools 11/1
Handout Charts Print PDF as whole pages and not multiple document pages per
printed page.
Charts 2023-11 Bar Chart
Examples Trends & Support & Resistance 11/3 -
Charts 2023-11 Bar Chart Examples -
Topping & Bottoming / Consolidation 11/ Mark-Ups posted 11/
Charts 2023-11
Alternative Charts Examples - 11/10 reposted 11/??
Charts 2023-11
S&P 500 Charts Examples - 11/3 reposted 11/??
Elliott Wave The links
www.dolefin.com have changed so you will need to go in through the front door
if you want to see of topics.
Handout - Market Wizards Sample
10/27
Market Wizards Assignment Schedule -
Your assignment is due by the end of the week by the end of the day.
Futures
Mag 2011-03 William Eckhardt Interview
Textbook Chapters
Purcell & Koontz Textbook (Left
Click to Open Link.)
Other Reading Material
WSJ 2008-07-17 Declining Value of College Degree - The news here is not really
all that bad and it has implications what you do this last year or two of and
what you need to do after university.
Hedging Articles
Articles on Speculators
Price Discovery Examples
CME Group Hedging Self-Study
Guides
CMEG
Self-Study Guide to Hedging with Grain and Oilseed Futures and Options.pdf
CMEG
Self-Study Guide to Hedging with Livestock Futures and Options.pdf
CMEG
Introduction to Dairy Futures and Options.pdf
Reading Material on Hedging
& Risk
Farm Use of Futures, Options, and Marketing
Contracts USDA ERS Publication
Managing Risk in Farming: Concepts, Research,
and Analysis USDA ERS Publication
KC Federal Reserve Bank Ag
Meeting Papers
Agricultural Cycles and
Implications for the Near Term Ani L. Katchova
and Ana Claudia SantAnna
The Normal Normal: Supply and Demand
Drivers over the Next 10 Years Seth Meyer and Joe Glauber
Long-Run Uncertainties for U.S. Agriculture
Rosamond L. Naylor
Transitioning to the Long Term Michael
Gunderson
Reading Material on Problems
with Basis Convergence
Non-Convergence in Domestic Commodity Futures
Markets USDA ERS Publication
Poor Convergence Performance of CBOT Corn,
Soybean and Wheat Futures Contracts University of Illinois Publication
The Causes and Effects of Wide
Kansas Wheat Basis Bids Kansas State University Publication
Wheat Basis and
Convergence Issues Kansas State University Presentation
Extra Reading Material
CSU DARE Undergraduate
Learning Outcomes
Congressional Budget Office Report Outlook for the Budget and the Economy - https://www.cbo.gov/topics/budget/outlook-budget-and-economy
U.S. Federal Reserve System Economic Projections -
https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20210616.pdf
CFTC Complaint Against Kraft
Foods Group & Mondelēz Global
CFTC Complaint Against PFG Best
CFTC Complaint Against MF
Global
Gordon and Rouwenhorst - Yale University Paper - Facts and
Fantasy's About Commodity Futures
Simulated Trading Material
Exam Information
AREC 412 List of Exam 1 Topics
exam date approximately 10/20 - There will be five or six multiple-part
questions. One production hedge, one
storage hedge, and three or four concept questions. The concept questions are short-answer
requiring definitions, lists, and discussion.
Problem Sets are for figuring out the details of the decisions made and
assessed. Exams will ask for some of
this but will be brief and focused. The
things that have not shown up on Problem Sets or Quizzes are the bigger-picture
concepts at issue.
AREC 412 List of Exam 2 Questions exam date approximately 11/30 - There will
be five or six questions. Two
fundamental analysis questions. Two or
three technical analysis questions one or two using real-world charts and the
balance will be a discussion/techniques/principles question. Finally, there will be one other
discussion/context question.
AREC 412 List of Final Exam Questions (time & date posted on university
final exam calendar & in syllabus) Two Hedge questions with one a Storage
Hedge, one or two Fundamental Analysis questions with one being elasticities,
two or three Technical Analysis questions with one or two involving charts, and
several discussion-of-concept questions.
Quizzes
AREC 412 Quiz 1
- Customer Account 8/30 & posted to Canvas - due 9/
AREC 412 Quiz 2 - Marking
to Market 9/1 & posted to Canvas - due 9/
Purcell &
Koontz pages 5-8
PDF of the prices
AREC 412 Quiz 3 - Basic Hedge 9/27 & posted to Canvas due 10/ for
online students
AREC 412 Quiz 4 - Storage Hedge 10/4 & posted to Canvas - due 10/ for
online students
AREC 412 Quiz
5 Market Information 10/23 due 11/3
AREC 412 Quiz 6 - Charting 11/
Problem Sets
AREC 412 Problem Set 1
9/18 - due 9/27 (Start Parts F-K immediately and then complete Parts A-E when
we cover that material in class.)
Problem Set 1 Data -
Right Click and Save As...
Problem Set 1 Key to be posted to
Canvas
AREC 412 Problem Set 2
9/29 - due 10/9
Problem Set 2 Key to be posted to
Canvas
AREC 412 Problem Set 3
10/20 - due 10/30
Problem Set 3 Key to be posted to
Canvas
AREC 412 Problem Set 4
11/6 due 11/17
Problem Set 4 Key to be posted to
Canvas
AREC 412 Problem Set 5 well see...
Careers and Opportunities...
How to Get Rich Statement,
not a question...
Savings and Investments Overheads
Savings and Investments Figures
WSJ Spreadsheet of Mutual Funds - somewhat edited