Futures Trading: Final Report

The weather has an impact on the procurement of grains and makes it very volatile.  In 1990 a poor harvest contributed to low inventories and sales volume.   Willis

From the 1920s and into 1930s, oil fields in Oklahoma were booming in wild production. Even larger fields were opening in East Texas across the Red River, and in the Permian Basin around Odessa. Oil flooded the market, and when oil prices dropped, it was no longer profitable (pg. 219). As for the farmers, it impacted them negatively because the things that they grew or the cattle they raise would be sold for very little (pg. 219-220).

This article written in the Texas Agriculture, a magazine published by the Texas Farm Bureau, is about all the factors impacting farmers that effect their income. Over the past couple years, a combination of things has caused the average Texas farmers income to drop. The primary audience for this article is the farmers in Texas as they are experiencing these issues first hand. The secondary audience would be consumers who have noticed price fluctuations in products at the store and are wondering the reason.

Indeed, Document A states that farmers overproduced which caused prices to fall, but it is very evident and far more explanation is given for reasons such as railroads, banks, and the lack of government help.

Based on the 1988 Supreme Court case of Corn Product Refining Co. v. Commissioner (350 U.S. 46; 76 S.Ct. 20; 100 L.Ed. 29), hedging transactions were determined to be used to support business practices of certain commodities. Such hedging transactions are normal for businesses engaged in commodity sales such as coal or corn to protect against market

In the early 1990s, the farm economy in the heartland of the United States was weak. Farmers in North Dakota produced hard, amber Durham wheat and exported 75% to Italy for the production of high quality pasta. Prices for raw wheat fluctuated radically, depending on weather and growing conditions. Many farmers were having difficulty meeting payments for the expensive farm machin- ery required for crop production. Small family farms were disappearing and non-farm jobs in the area were scarce. Although consumers were paying record prices for food, many farmers felt that processors, who converted the raw grains into finished products for sale in

As the amount of crops produced increased, the prices paid for them decreased. This is shown by the graphs, “Production and Prices, 1860-1895” In 1860, only 1000 million bushels of corn was produced, and the price per bushel was about $.65. By 1895 over 2500 million bushels

10. The current price of silver is $750. Storage costs are $8 per ounce per quarter payable in advance. The interest rate is 12% p.a. with continuous compounding. Calculate the futures price of silver for delivery in six months (to two decimal places).

Therefore, those who receive SNAP benefits can only buy food staples such as wheat. Since there will be approximately 48 million Americans that will only be allowed to purchase food staples, such as wheat, the domestic demand of this commodity will increase. However, with the application of this bill the supply of wheat exports will go down in the long run causing an increase in price and a decrease in quantity, as shown in figure 1.04. However, in the short run the demand for exported wheat will decrease provoking an increase in both price and quantity, also shown in figure 1.04. Accordingly, displaying how the modification of the US Farm Bill will affect the price and quantity of wheat exported out of the US in the short and long

The “Stock Market” is a term that actually describes several markets such as the New York Stock Exchange NASDAQ, where the stocks of companies are traded. Shares in a company are sold and the shareholders then become part owners of the company. Offering shares of stock raises money for continued research and development of company products or services.

crop prices falling by approximately 60%. California appeared to be a golden opportunity; a chance

Even though vegetable prices were supposed to drop after festive season, mid-November, it is very unlikely. Rutherford also pointed out that, "World populations are paying record prices for cereals, meats, and all other types of products" (Rutherford 1). These high prices have impacted the United States negatively and positively.

As a farmer you need to watch the changing prices for the products. They use different actions to keep themselves safe from unpredictable changes in the markets. Farmers also track disease and weather conditions closely, because disease and bad weather may have a bad blow on crops or animal health. When farmers plan ahead they may be able to store their crops or keep their animals to take

2. i) According to world – ostrich organization (http://www.world-ostrich.org/demand.htm), the current demand for ostrich meat is way far more than supply. Therefore, there will be a constantly increase in the price of ostrich meat. Investors are reluctant to take short positions of ostrich meat futures; however, there would be a lot of people willing to take long positions. Thus, the long positions will be in far excess of short

A recent report from HSBC isn’t quite so alarming…unless you read between the lines. “World agricultural markets,” it says, “have become so finely balanced between supply and demand that local disruptions can have a major impact on the global prices of the affected commodities and then reverberate throughout the entire food chain.”