Return to TFB Main Page
Return to Texas Agriculture Archive

October 20, 2000

MARKETING

By Bryce Myrick
Director, TFB Agricultural Marketing Education

Many producers around the state tell me the reason they do not use
the Futures Market to hedge their feeder cattle prices is that the contract size is too large.

The Chicago Mercantile is now trading an E-mini Feeder Cattle Contract. This contract is 10,000 pounds, which makes it equal to 11 to 14 head of cattle. This contract is traded by a market-maker, so there is always liquidity. The contract is cash settled so there is no delivery involved. By using one or more of these contracts and staggering out the times and prices, producers can better manage their marketing.

If you want information on how to open an account, call me and I will give you requirements and help you learn how to place the orders.

For help with your hedging needs or to set up workshops,
call Bryce Myrick.
254-751-2242
915-698-0355
e-mail: bbmyrick@swconnect.com

Feeder Cattle

Fundamentals: Feeder prices strong, but cash live cattle 68.00.
Technical Analysis: Trend-Short-term Up; Support-85.50; Resistance-88.30

Cotton

Fundamentals: Higher prices, but lower LDPs
Technical Analysis: Trend-Sideways; Support-62.15; Resistance-67.30

KC Wheat

Fundamentals: No Moisture in much of the planting area.
Technical Analysis: Trend-Short-term Up; Support-3.23;Resistance-None

Corn

Fundamentals: Big crop in Corn Belt.
Technical Analysis: Trend- Short-term Up; Support-2.20; Resistance-None