Jul 21, 2024  
2024-2025 Course Catalog 
    
2024-2025 Course Catalog
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AGB 235 - Intro to Agricultural Markets

Credits: 3
Lecture Hours: 3
Lab Hours: 0
Practicum Hours: 0
Work Experience: 0
Course Type: Open


Focuses on the futures market and how it can be used as a marketing tool. Major areas of study include hedging, speculation, price forecasting, spreading, technical and fundamental analysis. The use of options as an economic marketing tool will be covered.
Competencies
  1. Summarize the current industry issues
    1. Explain the economic impact global markets have on the state, national, and world economies
    2. Define issues that have historically affected the industry
    3. Define issues that impact the future of the industry
    4. List career opportunities
  2. Analyze commodity marketing and risk management
    1. Identify types of inherent risk in commodity production such as weather, basis risk, interest rates, storage costs, storage timing, etc
    2. Interpret commodity charts
    3. Calculate carrying costs
    4. Calculate carry in the market place
    5. Discuss the role crop insurance and other federal programs play in risk mitigation
  3. Evaluate technical and fundamental charting
    1. Identify price cycles, industry and seasonal production trends
    2. Chart a commodity
    3. Chart option premiums
    4. Calculate costs of both buying and both selling puts and calls
    5. Chart basis
    6. Calculate basis  
    7. Explain the role of basis in setting local cash pricing
    8. Use historical basis data in selecting optimal hedging times
    9. Calculate break even costs for commodities
    10. Interpret seasonal market trends
  4. Characterize components of an agricultural market
    1. Discuss the influences commodities can have on each other
    2. Identify contract variables, sizes, amounts, trading time, daily limits, locations, etc
    3. Identify terminology involved with commodity trading ( short, long, buy, sell, Futures, Options, Cash Forward, etc)
    4. Outline regulatory agencies that are involved with trading at the commodity exchange along with their functions such as CME, CBOT
    5. Discuss the role a clearinghouse plays in a market
    6. Describe the role of the speculator in a given market
    7. Describe the role of the broker in an exchange
  5. Incorporate market simulation technology (Commodity Challenge)
    1. Demonstrate how a commodity trade takes place using marketing tools
    2. Develop a marketing plan
    3. Implement a marketing plan
    4. Practice setting and lifting hedges
    5. Outline key components of a marketing and procurement plan
  6. Evaluate cash marketing alternatives
    1. Identify methods of reducing price risk
    2. Diagram the art of placing and lifting a hedge
    3. Construct a T diagram consisting of Futures market movement both up and down when using marketing tools such as Futures, Options, and Forward contracts

 

 

 
Competencies Revised Date: AY2023



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