A34—Lancaster Farming, Saturday, September 29,1984 NEWARK, Del. - With all the confusion concerning the gram market outlook these days, far mers are having a tough time arriving at a practical sales strategy. Most growers are fairly dependent on price forecasts in setting their price objectives, says University of Delaware extension marketing specialist Carl German. Basically, farmers have two types of forecasts to go on distant futures contract prices, or the predictions derived from sophisticated econometric models. These models consist of a set of mathematical equations designed to account for the variability in UNIVERSITY PARK - The Pennsylvania Dairy Herd Im provement Association (DHIA) is averaging a turnaround rate of 4.0 days, reports Phil Dukas, Penn sylvania DHIA general manager. This figure represents the average between the date a sample is collected and the time the processed management package is in the mail on its way back to one of the 6,200 participating dairy far mers. “Our members are telling us that economics are forcing them to put DHI to use more quickly,” says Dukas. “Six days, the previous average, was too long a delay for their culling decisions, feed changes and cattle sales. At four Sire Power plans Md. open house FREDERICK, Md. - The Maryland Sales Division of Sire Power will hold its annual Open House on Thursday, Oct. 11, from 10 a.m. to 3 p.m. at the Maryland headquarters near Frederick. Highlighting the afternoon program will be Karl K. Kettering, motivational speaker. Shop direct by phone or mail and save Save on hundreds of animal health needs for cows, swine, horses and poultry Send for your free catalog today, and start enjoying the quality, convenience and sav ings of buying direct from Agway Catalog Service, Inc Making grain maketing decision is complex conditions affecting price. Which method is likely to be a more reliable indicator of price trends 7 A study by University of California economists Just and Rausser, published in 1981 in the American Journal of Agricultural Economics, sheds some light on the question. When they compared the two forecasting methods, they found no overwhelming evidence in favor of either. However, says German, they did find that in general futures market prices are surprisingly accurate indicators, when compared with econometric forecasts. 4-day interval in DHIA days we are nearing the limit for our current structure, but our members feel even this turnaround rate may not be acceptable for long.” The Pennsylvania DHIA’s current turnaround tune is the lowest in the nation. “Without an effective network of supervisors, staff, and Extension agents, we could not achieve anything nearly as efficient,” Dukas says. When asked what DHI will do to further deduct the turnaround rate, Dukas replied, “We are working to improve supervisor quality and to decrease the reporting errors that cause delays. The next major step will be electronic data transmission from "^NEW! Agway Animal Health Catalog M>i I l(' ' 1 TREE' ■ • ■ Mail to Agway Catalog Service, Inc , | PO Box 306, Elizabethtown, PA 17022 | Or call toll-free, 1-800-441-6007 (in PA | call 1-800-222-3509) I Name 1 Address | | | City State Zip ■ Working for people who work the land In addition, General Manager, DuWayne A. Kutz, will review the past year’s business and bring members up to date on Sire Power Programs and Services. Tickets are available from the Maryland office, personnel, and at the door. -"v***** 0 From Agway Catalog Service, Inc Neither system is necessarily to blame for the errors involved in price forecasting, the specialist says. Forecasts often are swayed by external factors not easily accounted for. Since there’s considerable room for error in any price forecasting sales strategy, how can farmers pick a reasonable and profitable approach to marketing their crops? About eight different approaches are currently in use. Which method or combination of methods growers choose depends mi the degree of risk they’re willing or the farm and an increase in the number of computer runs each day.” Since 1982 Pennsylvania DHIA has made changes to improve quality and efficiency, including a new data entry facility, electronic editing of reports and labor saving lab techniques. “In October we will be announcing a new system to automatically transfer cows between herds,” says Dukas. “This will improve accuracy and may knock another tenth of a day off turnaround.” ■ AGWAY * v IM CATALOG (AGWAY) SERVICE INC v able to accept. This is how German describes each system: —Fair Weather/Foul Weather Approach. “Essentially,” he says, “this boils down to the attithde: if it feels good, sell a little; if it feels bad, sell a lot.” —Cash Flow Approach. “This method involves a lot of guesswork,” German says. “In the past, many farmers have stopped using any strategy at all after attempting this approach. The advent of the micro-computer may help make it more accurate. ’ ’ —What’s The-Market-Going-To- Do Approach (Price Forecast). This is probably the most widely accept approach to marketing, the economist says. When used by itself, it is probably the riskiest. —Milk Check Approach. “The philosophy behind this one is, if you need money, make a sale. This is 0.K.,” German says, “if you’re milking cows. Otherwise, it’s no fun.” —Balance Risk In Conjunction With Market Planning. “This approach starts to make sense,” he says. “Again, the advent of the computer should help make it more manageable. ’ ’ —Consider-The-Odds Approach. Price probabilities are difficult to quantify, the economist warns. —Consider-Everythmg Ap ROHRER'S QUALITY SEEDS Order Your Fall Seed Grains Now! • Toro Timothy •Winter Rye • Cert. Climax Timothy • Cert. Hunter Wheat • Timothy • Cert. Magnum • Pasture Mixture • Cert. Tyler • Waterway Grass Mix • Cert. Barsoy Barley • Reeds Canary Grass • Cert. Maury Barley Holland Extra Baler Twine Binder Twine ijmnii;ii!»:iii!iiw:iHi Smoketown. Pa. Ph: 717-299-2571 Lockwood’s got a system that’ll fit your field We know every field's special. A little bit different And that s why we want you to know that when you talk to your Lockwood dealer, you're talking to I'd like to custom tailor an Irrigation system for you. LEE RAIN IRRIGATION Over 35 Years of Service Wheat Rd Vineland, NJ 08360 (609)691-4030 proach. This method uses econometric modeling. It is thorough, but requires a good model and good data. —Cost Plus Approach. Essen tially, know your cost and sell when the market is above cost “This method is subject to error due to yield variability,” German says “but historical yield data for a given farm or area will provide sufficient base for deriving estimates.” At present he recommends farmers use this cost plus ap proach, using a combination of price forecasts andd risk analysis to plan commodity sales. “In the case of grains,” German says, “you have about two years in which to market a crop. Ex perience suggests that the marketer who begins his sales strategy a year ahead of harvest profits more than the one who starts planning sales at harvest. This is primarily because marketing in advance of a crop gives you more time to take ad vantage of profitable pricing op portunities.” Timing is the most important point to consider when marketing farm commodities, the specialist concludes. Proper timing of sales can make the difference between profit and loss. a trained irrigation professional A man who can customize an irriga tion system to fit your field He'll give you the best advice on how to achieve the water applica tion level you need at the lowest possible energy cost II LacHtuaaiJ
Significant historical Pennsylvania newspapers