1. Factors Affecting Price Movement by Dennis Schroeder – Marshall FBM

2. 1. Fundamentals Weather Gold - metals Transportation
Dock & truck strikes
USDA reports
Disease
Actions of other countries
Govt.. programs
Exports - imports
Domestic use
Interest rates
Value of the dollar
Inflation
Other factors

3. 2. Technical or charts Trends Chart formations Cycles Seasonal odds
Contrary opinion

4. 3. Emotions of people

5. Marketing tools for today’s Farmer
Cash contracts
Forward cash contract
Delayed price contracts
Govt.. programs
Future fixed contract
Hedging with futures
Hedging with call options
Hedging with put option
Basis fixed contract
Others

6. Developing a marketing plan

7. Developing a Marketing Plan
What is a marketing Plan?
A marketing plan is a strategy that will help producers identify and evaluate costs, set price goals, cash flow needs, determine potential price outlook, set decision dates, examine production, use crop insurance, and consider the ability your have to accept risk.
Why do we need a marketing plan?
Fear, greed, and emotions – can all effect your decisions. By writing down your plans, it is like a road map to work from. Identify where we are going and how we are going to get there.

8. Why Have a Marketing Plan
Goals and Objectives
Requires a written plan to provide discipline, and is a good way to check your logic.
Road Map
Identify were we are going and how are we going to get there.
Discipline
Follow through!
What if Analysis
Use different possible price and yield scenarios to see how your strategies perform. Also allows your to see what you need at worst case scenario.

9. Financial Condition and Goals
Financial Situation
Review financial health of operation
Financial statement
Non-Farm Income
Incorporate Goals
(1-5-10) Year Goals
Risk Bear Capacity

10. Determining Price Goals
Cost of Production (Break-Even)
Use Sensitivity Analysis
How much will it affect my break even if yields change as much as 5, 10, or 20 percent.
Family Living
What do you need to live on?
Profit/Growth Needs
Purchase of new machinery, expanding the operation?

11. Market Outlook Fundamental Analysis
Use the information age and technology. Be aware and keep the big picture in mind.
Technical/Seasonal/Cyclical Analysis
Many traders follow technical, can have an affect how the markets react.
Political Situations
U.S. and around the world can affect the supply and demand situation.

12. Production Risk Tools Crop Insurance Hail Insurance
Multi-peril Crop Insurance
CRC
All can be helpful to reduce risk due to yield loss

13. Price Risk Tools/Alternatives
Pre-and Post Harvesting Pricing Tools
What pricing tools are available, and which are you willing to consider using?
Forward contract
Futures market
Option market
Hedge to arrives
It is not an alternative if you do not know how to use it.
Combination of Tools
Allows to spread out your price risk
Gives a longer horizon over which to find a profitable price that meets your objective.
Advantages / Disadvantages
Each tool has advantages and disadvantage, evaluate and bring yourself to an understand before utilizing alternatives in a marketing plan.

14. Price and Date Objectives
Planting Time (Price Needed)
Summer Drought Rally (Price Needed)
Post-Harvest Seasonal Rally (Price Needed)

15. Market Strategy Put The Written Plan Together
When to Sell / and at what price
How much to sell (at what price to start)
How to make sales (what tools to use)
What to do if Price Increases
What to do if Price Decreases

16. Evaluation How will I know if my marketing plan is effective?
You will have met your financial goals, that is the ULTIMATE measurement!
What Worked / What Did Not
Why?
Areas That Need Improvement
May be areas of expanding your alternatives by learning more about specific strategies.

17. Review of Developing a Marketing Plans
Review financial conditions and goals
Determine your price goals
Examine market outlooks / expectations
Production risk tools
Price risk tools
Set price and date objectives
Prepare a marketing strategy
Evaluate