This is a course on agricultural commodity markets in general and specifically a commodity futures and options markets course. The emphasis will be on major commercial agriculture field crops and livestock – mainly but certainly not limited to Colorado. The course will involve study of commodity price behavior. Attention will be paid to the role of futures markets as an institution in a market economy, as well as use of futures contracts and options on futures contracts in firm asset and risk management. Emphasis will be placed on the mechanics of futures and options trading, basic relationships between cash and futures markets, fundamental and technical behavior of commodity futures prices, hedging strategies, futures market regulation, and commodity futures market performance.
- Learn institutions unique to commodity and futures markets – how do these markets work and who are the participants.
- Develop skills for measuring and managing market price risk in an agribusiness environment.
- Understand how to conduct commodity market analysis using underlying economic fundamentals and using the tools from technical analysis.
- Develop abilities to synthesize topics from prior coursework into a comprehensive understanding of markets.
There are excellent and persistent career opportunities for students with knowledge of and skills related to commodity markets. A purpose of this course is to provide students the opportunity to study and learn the skills that commodity marketing firm employers value. This is a major goal of the instructor. The instructor also recognizes that university is not only career training. Markets continue to grow and expand, and a successful, well-educated university student will recognize the entrepreneurial opportunities that understanding markets offers.
This course can be applied towards:
AREC 310 (Agricultural Marketing). Concurrent registration is acceptable as long as the student recognizes the needed additional effort. It is recommended that students be junior or senior at university. A 300-level marketing course and a 300-level agribusiness management course are points of departure. Basic data and statistical analysis through spreadsheets will be conducted. Therefore, skills in MS Excel, statistics, mathematics, and/or econometrics will be useful. Market data and other commodity market information will be gathered from the internet so knowledge of search engines and procedures will be useful.
Textbooks and Materials
Textbooks and materials can be purchased at the CSU Bookstore unless otherwise indicated.
- The New Market Wizards
Schwager, Jack D.
Another required text, Agricultural Futures and Options: Principles and Strategies - 2nd edition, is available free online on the class website. The authors are Wayne D. Purcell and Stephen R. Koontz. ISBN: 0137799438
The Wall Street Journal is required for this course. Please contact the instructor regarding ordering the Wall Street Journal at a discounted price .
Dr. Koontz is a professor in the Department of Agricultural and Resource Economics and has been a faculty member at Colorado State University since January 1998. He has a B.S. and M.S. in agricultural economics from Virginia Polytechnic Institute and State University and a Ph.D. in agricultural economics from the University of Illinois. He was on faculty at Oklahoma State University for six years and Michigan State University for two years prior to joining Colorado State University.
Dr. Koontz works in the area of commodity marketing, risk management, price analysis, and industrial organization. He has co-authored the second edition of Agricultural Futures and Options: Principles and Practice, with Wayne D. Purcell.
His responsibilities at Colorado State University include research, teaching, and outreach. His teaching program includes graduate courses in research methods and agricultural markets and undergraduate courses in agricultural and commodity marketing. His research and outreach programs are in the areas of commodity market and price analysis, futures markets and risk management, and market organization and performance. His research focuses largely on livestock and meat product markets. He was a member of a multi-institution research team that worked on the cattle and beef portion of the Congressionally-mandated 2007 USDA Grain Inspection Packers and Stockyards Administration Livestock and Meat Marketing Study.