Markets - Field Crops
The field crops section of the Division of Marketing provides assistance and services to the grain, oilseeds, cotton, peanuts and tobacco industries. Responsibilities include analyzing government reports, advising producers on cash merchandising, and developing risk management educational programs.
Financial risk management is a key component of profitability in agri-business. Education on the use of derivatives is offered in the following areas:
- long and short futures hedging to manage position risk
- using options as insurance and asset substitution
- minimum and maximum contracts and synthetic hedging
- using short-term interest futures to manage credit line risk
Two of the government reports that are closely followed are the crop production and the world supply/demand, which are issued monthly. These reports forecast both U.S. and world production and the carryover stocks, which have a major influence on the volatility on the market.
The tobacco section monitors warehouse volume, average prices and legislative policy issues. It acts as a liaison between the department and the tobacco industry.