Agricultural Marketing Policy Papers
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Item Risk Management Options for Wyoming Farms(2009-05) Johnson, James B.; Smith, Vincent H.Farm managers know they are involved in financially risky enterprises and, as a result, develop strategies and tools to manage that risk. Typically, those strategies involve the use of multiple production, price and business risk management tools.Item Risk Management Options for Montana Farms(2009-05) Johnson, James B.; Smith, Vincent H.Agricultural production is a financially risky business. In Montana, production losses from natural hazards do occur (for example, drought, fire, hail and insect damage). Farm managers also face substantial price risks, both in resource markets where they purchase their inputs and in commodity markets where they sell their crops. Energy prices can vary substantially from one month to the next, as can nitrogen and other fertilizer prices. Crop prices can be volatile. Moreover, the link between farm-level production losses and commodity prices is weak. At the market level, when production is relatively low prices tend to be relatively high, but an individual agricultural producer may experience low levels of production because of locally adverse production conditions when commodity prices are also low.Item Risk Management Options for Wyoming Ranchers(2009-01) Johnson, James B.; Smith, Vincent H.; Hewlett, John P.Agricultural production is a financially risky business. On Wyoming ranches, forage losses from natural hazards (lack of moisture, severe drought, etc.) are frequent. Livestock losses also occur because of adverse winter weather, summer heat, animal disease and predation. Ranches also encounter substantial price risks, both in the resource markets where they purchase their inputs and the commodity markets where they sell their livestock and crops. Energy, corn and other feed prices can vary substantially from one month to the next, as can nitrogen fertilizer prices. Livestock prices can also be volatile. Moreover, the link between ranch level production losses and commodity prices is weak. At the market level, when production is relatively low prices tend to be relatively high, but an individual agricultural producer may experience low levels of production because of locally adverse production conditions when commodity prices are also low.Item Harvest-Time Protein Shocks and Price Adjustment in U.S. Wheat Markets(2007-08) Smith, Vincent H.; Goodwin, Barry K.Dynamic relationships between three classes of wheat are investigated using threshold VAR models incorporating the effects of protein availability. Changes in the stock of protein are found to generate significant impulse responses in the price of hard red spring wheat and hard red winter wheat but not soft red wheat. These impulse responses to identical changes in protein stocks are larger when the absolute deviations of protein stocks from normal levels are large. Shocks to the prices of individual classes of wheat result in complex impulse responses in the prices of the other wheat varieties. Notably, however, a shock to the price of hard red winter weak appears to result in little or no impulse response in the price of hard spring wheat, though, importantly, the opposite is not true.Item Risk Management Options for Montana Ranchers(2009-05) Johnson, James B.; Smith, Vincent H.Agricultural production is a financially risky business. On Montana ranches, forage losses from natural hazards (lack of moisture, severe drought, etc.) are frequent. Livestock losses also occur because of adverse winter weather, summer heat, animal disease and predation. Ranches also face substantial price risks, both in the resource markets where they purchase their inputs and the commodity markets where they sell their livestock and crops. Energy and feed prices often vary substantially from one month to the next. Livestock prices can also be volatile. Moreover, the link between ranch level production losses and commodity prices is weak. At the market level, when production is relatively low prices tend to be relatively high, but an individual agricultural producer may experience low levels of production because of locally adverse production conditions when commodity prices are also low.Item Regulating State Trading Enterprises in the GATT: An Urgent Need for Change? Evidence from the 2003-2004 U.S.--Canada Grain Dispute(MSU Extension, 2006-02) Smith, Vincent H.State Trading Enterprises (STEs) are one of the bete noirs of agricultural and other trade relations and trade negotiations. An STE is a government enterprises or quasi government enterprise that operates with special protections and/or privileges granted by its country’s central authority. STEs generally exist for one of two main reasons. Sometimes, as with many African parastatals, they are created to tax the domestic industry and/or imports for government revenue generation purposes (or income transfers to members of ruling elites). Alternatively, an STE’s mission is often to increase revenues or profits (though not necessarily both) from sales for domestic producers and/or processors and other marketing chain operations. In pursuing these revenue or profit objectives, STEs create trade distortions by implicitly levying tariffs on imports, taxing domestic sales, and subsidizing (or, on rare occasions, taxing) exports to different countries at different rates. They may also be vehicles through which domestic subsidies are more or less discretely funneled to producers, with corresponding implications for the effectiveness of disciplines on domestic supports. Hence, STEs are problematic in the context of trade negotiations.Item Re-opening the U.S./Canadian Border to Live Cattle and Beef Trade: Estimated Impacts on U.S. Beef Producers(MSU Extension, 2005-09) Marsh, John; Brester, Gary W.; Smith, Vincent H.In May 2003, Canadian authorities announced that a Canadian cow had tested positive for bovine spongiform encephalopathy (BSE or mad cow disease). Almost at once, the United States and many other countries banned all imports of Canadian cattle and Canadian beef. The consequences for Canadian cattle prices were severe. Export markets accounted for almost 40 percent of Canadian beef production and 30 percent of live cattle sales between 1995 and 2002. As a result, Canadian fed steer prices declined 55 percent from about $US 83/cwt in March of 2003 to about $US 37/cwt in September of 2003.Item Harvest-Time Protein Shocks and Price Adjustment in U.S. Wheat Markets(MSU Extension, 2005-06) Goodwin, Barry K.; Smith, Vincent H.Dynamic relationships between three classes of wheat are investigated using threshold VAR models incorporating the effects of protein availability. Changes in the stock of protein are found to generate significant impulse responses in the price of hard red spring wheat and hard red winter wheat but not soft red wheat. These impulse responses to identical changes in protein stocks are larger when the absolute deviations of protein stocks from normal levels are large. Shocks to the prices of individual classes of wheat result in complex impulse responses in the prices of the other wheats. Notably, however, a shock to the price of hard red winter weak appears to result in little or no impulse response in the price of hard spring wheat, though, importantly, the opposite is not true.Item Agricultural Chemical Prices in Canada and the United States: A Case Study of Alberta and Montana(MSU Extension, 2004-12) Smith, Vincent H.; Johnson, James B.Differences in retail prices for similar or identical agricultural chemicals have been a source of controversy in the Prairie Provinces of Canada and the Northern Great Plains States of the United States since the mid-1990s. Such differences may exist because of differing pesticide regulations between the United States and Canada. Different regulations may inhibit trade between the two regions and isolate markets from one another. If this is the case, then regulatory harmonization that allows Canadian and U.S. agricultural producers to purchase agricultural chemicals in Canada or the United States would generally lead to harmonization of agricultural chemical prices.