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Kansas Agricultural Experiment Station Research Reports
2008; Kansas Agricultural Experiment Station contribution; no. 08-212-S; Report of progress (Kansas State University. Agricultural Experiment Station and Cooperative Extension Service); 995; Beef; Cattle; Distiller’s grain (DG); Soybean meal (SBM)
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Distiller’S Grain Market Price Relationships, Discovery, And Risk Management (2008), T.W. Van Winkle, Ted C. Schroeder
Distiller’S Grain Market Price Relationships, Discovery, And Risk Management (2008), T.W. Van Winkle, Ted C. Schroeder
Kansas Agricultural Experiment Station Research Reports
The substantial increase in corn use by the ethanol refinery industry (Figure 1) has resulted in livestock producers, especially cattle feeders, substituting distiller's grain (DG) for corn in feed rations. DG futures markets do not exist, but actively traded corn and soybean meal (SBM) futures are the most probable markets for hedging DG price risk. Therefore, the ability to offset DG price risk using corn and SBM futures is incorporated into analysis to quantify the strength of price relationships. If DG prices and corn or SBM futures prices are strongly related, then a viable cross hedging opportunity might exist. If …