Hedging Milk with BFP Futures and Options

David Anderson, Dean McCorkle, Robert B Schwart, Jr., and Rodney Jones ( December, 1998 )

Summary

Basic Formula Price (BFP) milk futures and options can be used to hedge, or lock in, milk prices in order to manage milk price fluctuations. This publication offers information on futures contracts, basis, cash settlement, and margin call. There also is a hedging example.

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Details

Organization

AgriLife Texas A&M University Extension

Publisher

Texas A&M University

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1421

Material Type

Written Material