A34-Lancaster Farming, Saturday, August t, 1998 Weighing Your Options Agriculture is one o( the few industries in the world where pro duccrs do not know then final selling pnee until alter (hen goods .ire sold This is why tanners ate sometimes called 'price lakcis' ralhei than "price makcis As margins loi returns continue to shimk ninny tanners arc begin ning to cxploie futures markets and hedging as wavs to help stabi lize their returns Puce volatility and uncertainty arc often things that not only producers, but also uscis of commodities attempt to minimize One ol the newest players in the commodity tree markets is the dairy industry As the government price support systems begin to lie phased out, daily tanners will need to become awaic of their allcma Feed Saved is Profit Made Farmco’s efficient feeders put feed into your animals, not on the ground. Built for years of rugged use, they are a wise investment in your farming business 10 models available in 27 sizes. ftfedWTW* gaeaiwrtheeinalfitnn, 7 V2'indi*meier. Delaware Hooter Equipment Middletown DE * 410/341 4028 Jays Barns Fronkford DE * 302/732 6040 Maryland C B Hooter Georg* Hines Equipment Intercourse PA • 717/766 8231 Union Bridge MD • 410/775 2629 Cuds Welding Potomac Valley Supply Rome PA • 717/24 7 2539 Hagerstown MD • 301/223 6677 Walter G Coale Inc Churchville MD* 410/838 6470 New Jeraey Brodhecker Farm Newton NJ • 201/383 3592 Quality Structures Flemmgton NJ • 908/782 7408 lives For dairy fanners, the prac tice ot using the lulurcs and op tions markets to protect against low milk prices is known as hedg ing Richard Mollitor, an agncul- ( ture risk management specialist at the Chicago Mercantile Exchange, defines hedging as the practice ol taking a position in the futures and/or options market opposite to that in the cash market The op portunity includes locking in prof itable selling prices (by selling fu tures contracts) and establishing a minimum selling price while still allowing you to benefit from a using market (by buying Pul op- tions) The Put option becomes your insurance' against a dra matic downturn m the price of Richard Kenwodhy Bernardsville NJ • 908/766 0063 Pennaylvanla BlueMt Diesel New Tripoli FA *6lO/298 3483 Ert