Business Commons^™

Importance Of Good Communications For Generational Ag Business Transfers, Allan Vyhnalek

Cornhusker Economics

Adapted from Right Risk, volume 10, Issue 10, October 2022.

Effective communication within a farm or ranch family, especially when multiple generations are operating and managing the business, is the underpinning of all other decisions made in a family business. It is critical that farm and ranch families identify areas of contention and develop communication skills that will allow them to negotiate satisfying outcomes. This may involve basic skills training, including communication, problem solving, and decision making.

Innovation In Futures Markets: Event Contracts, Speculation, And Hedging, Fabio Mattos

Cornhusker Economics

The CME Group has recently launched a new type of contract whose payoffs are based on specific events. These contracts are called event contracts but are also known as prediction contracts or information contracts. They are short-term contracts that expire at the end of each trading day. Traders can take positions in these contracts as they predict whether the price of a given asset will finish the trading day above or below a set value.

Discusses: How are they traded? Main characteristics of event contracts. Event contracts offered by CME group and event examples on October 21, 2022. Why were …

Historical Corn Price Evolution Implications For Pre-Harvest Hedging, Cory Walters, Richard K. Preston

Cornhusker Economics

Commodity markets evolve through information provided by participating buyers and sellers and throughout this process the conditions in which commodity markets work are revealed. Producer pre-harvest commodity marketing can be further developed by incorporating information on how commodity markets work, leading to better farm financial performance.

We investigate how commodity markets have historically evolved from spring to fall. While changes in future prices appear random in any given year, observing average daily prices over 32 years could uncover a seasonal tendency. In the past 32 years, the average daily price tends to be higher in the spring than the fall, …

New Cooperative Approaches: Successes And Opportunities, Charlotte Narjes

Cornhusker Economics

The National Cooperative Business Association CLUSA International states that there are 40,000 co-ops in the United States that range in size. Examples of cooperatives include the local Ace Hardware (purchasing cooperative) to Land O' Lakes. Cooperative businesses operate across virtually all industries, or sectors. The most common cooperative in Nebraska is the agricultural cooperative. According to the Nebraska Cooperative Council ag facts, in June 2020 there were 401 cooperatives located across the state providing jobs and services in many rural communities. In addition, there are over 64,400 farmers and ranchers that are voting members of Nebraska cooperatives with many members …

On The Market For "Lemons": When Low Quality Does Not Drive High Quality Out Of The Market, Konstantinos Giannakas, Murray E. Fulton

Cornhusker Economics

In a research article published in Nature's Humanities and Social Sciences Communications (available at https://www.nature.com/articles/s4l 599-020-00658-w) we identify the conditions under which the introduction of a low -quality product does not drive its high-quality counterpart out of the market but, instead, ends-up coexisting with it. Using a theoretical framework of heterogeneous consumers and producers in the context of a market for quality- ( or vertically-) differentiated products supplied by producers differing in their production efficiency, we show that the equilibrium quality configuration in a market depends on both the unobservability of product quality by consumers and the relative costs …

Don't Let The Past Sink Your Future, Timothy L. Meyer

Cornhusker Economics

Decision scientists have many algorithms for making decisions. These algorithms can be qualitative and subjective, such as following a 7-step process, to highly quantitative procedures like minimax regret, or linear programming. These techniques are very different from each other, but in one way they are very similar; they never, ever suggest the manager become emotional and use past decisions to guide the future.

Past decisions and events should guide decision-making. They help managers assign probabilities as well assessing performance. Viewing these events and situations as permanent paths is where sunk costs become problematic.

Includes discussions of four scenarios.

The Storm In World Fertilizer Markets Continues, John C. Beghin

Cornhusker Economics

This article updates the recent article on world fertilizer markets by Beghin and Nogueira (2021), which noted the perfect storm affecting global fertilizer markets through high demand, droughts affecting fertilizer supply, high fossil energy prices, COVID 19-related supply-chain disruptions, and trade policies, all conspiring to elevate fertilizer nominal prices to levels not seen since 2008. In the last 10 months, the Ukraine-Russia war and associated trade sanctions have exacerbated the disruptions in fossil energy, grain, vegetable oil, and fertilizer markets already present in 2021. On the more hopeful side, some United States trade policy developments will help reduce US fertilizer …

Setting The Stage For The Next Farm Bill Debate, Bradley D. Lubben

Cornhusker Economics

The 2018 Farm Bill is set to expire in September 2023. New farm bill legislation will be needed by then if authority is to be extended for a wide range of programs from farm support to conservation, nutrition assistance, credit, trade promotion, rural development, research and education, and more.

The agricultural committees in Congress have already held initial hearings and many agricultural and other interest groups have noted their policy priorities. However, formal debate on a new farm bill is not expected to begin in earnest until early 2023 when a new session of Congress convenes.

While the formal debate …

Disagreements And Proper Respect In Farm/Ranch Succession, Allan Vyhnalek

Cornhusker Economics

Adapted from "Does Disrespect Have a Place in Your Ag Legacy?" Volume 6, Issue 1, February 2021, Ag Legacy, by Caleb Carter, consultant to the Department of Agricultural and Applied Economics in the University of Wyoming College of Agriculture and Natural Resources.

Briefly covers disagreements and proper respect in farm/ranch succession.

Flexible Cropland Lease Arrangements Across Nebraska In 2022, Jim Jansen, Jeffrey Stokes

Cornhusker Economics

Survey results shown and discussed in this report are findings from the University of Nebraska-Lincoln's 2022 Nebraska Farm Real Estate Market Survey. Complete results from the survey may be found at the Nebraska Farm Real Estate website: http://cap.unl.edu/realestate.

Use Of Livestock Risk Protection Insurance For Cattle Continues To Grow, Jay Parsons

Cornhusker Economics

When used as a regular part of a market risk management plan, livestock risk protection (LRP) insurance can help protect profits in years where markets turn for the worse. The recent changes to the program have made LRP insurance more appealing to cattle producers and sales of LRP have subsequently increased dramatically. Strong price increases may make LRP unnecessary, but it is difficult to predict when the price increases will end. LRP insurance is a safety net, reducing downside price risk by providing a floor on national price expectations while also allowing producers to take advantage of higher national prices …

Inflation: Just How Bad Is It?, Timothy Meyer

Cornhusker Economics

Amidst the chaotic news cycle of politics, the pandemic, and global affairs, a new topic is making headlines – inflation. To some, rising inflation causes greater fear than the other headlines combined; to others, it is nothing more than a minor nuisance. This article will explain why people’s divisive attitudes toward inflation are likely justified.

Who Owns This? Ways That Property Can Be Owned And Transferred In Nebraska, Jessica Groskopf, J. David Aiken

Cornhusker Economics

Discusses ways that property can be owned and transferred in Nebraska in the context of farm management in Nebraska, United States.