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English 250 High Grain Price Mediation

English 250 High Grain Price Mediation. Mick Sitzmann. Problem to be Solved. Drought of the Summer of 2012 caused record high grain prices. Scarce amounts of rain caused the crops of the Midwest to have minimal yields. -Only 6.6” from June-Sept. in 2012

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English 250 High Grain Price Mediation

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  1. English 250 High Grain Price Mediation Mick Sitzmann

  2. Problem to be Solved • Drought of the Summer of 2012 caused record high grain prices. • Scarce amounts of rain caused the crops of the Midwest to have minimal yields. -Only 6.6” from June-Sept. in 2012 • Low yields means small amounts of grain. • Small amounts of grain leads to low supply for consumers.

  3. Grain Price Contracts • A Grain price contract would satisfy the needs of both parties involved in the conflict of high grain prices.

  4. Who is Affected by High Prices • Prices as high as they have been recently are taking a tollon many different operations and families. • Two main groups in particular. • Row- Crop Farmers • Cattle Farmers

  5. Row Crop Farmers • Not producing enough grain to keep the price low • Law of Supply and Demand • Farmers making huge profits if they have excess grain. • Worried about big crash of markets after these record prices.

  6. Cattle Farmers • Really feeling high grain prices through rising feed costs. • Starting to question if purchasing feed is worth the cost of raising the cattle. • Rising meat cost at the store is the end effect of the high feed costs.

  7. Some Against Grain Price Contracts • People want to take the chances of making money on their own. • Some have other strategies to sell their grain at high market points. • “Some people might make mistakes…..” (Sitzmann)

  8. Mediation • Grain Price Contract • Price agreed upon by both parties in the contract to sell and buy grain at. • Helps row crop farmer because it takes away risks of market crashes. • Helps cattle farmer because it takes away fear of extreme high prices.

  9. Works Cited • "2012 Precipitation." USGS Iowa Water Science Center., 23 Apr. 2013. Web. 4 May 2013. • "Drought meeting with Vilsack draws hundreds." KCCI News., 17 Aug. 2012. Web. 2 Apr. 2013. • Thornberry, Tim. "The high grain prices of 2012 are likely to stick around through 2013, expert says." KyForward., 6 Jan. 2013. Web. 3 Apr. 2013. • "Look for Grain Prices to Remain Historically High." National Hog Farmer., 14 Jan. 2013. Web. 2 Apr. 2013. • Hurt, Chris. "Drought Creating Decline in Cattle Numbers, Value." AgFax., 6 Aug. 2012. Web. 1 Apr. 2013. • Piller, Dan. "Rising beef prices worry producers." USA Today., 18 Feb. 2013. Web. 4 Apr. 2013. • "Grain Contract Glossary." Farmers Cooperative Co. Web. 2 Apr. 2013. • Sitzmann, Jim. Personal interview. 1 Apr. 2013.

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