Posted by: usset001 | September 17, 2010

Grain marketing simulations games are available to everyone on Commodity Challenge

I’ve already received inquiries from producers who wish to play a Commodity Challenge simulation game, but they had no open games to join. Problem solved! Earlier today I created three new games; the Iowa Corn open, the Minnesota Soybean open, and the Montana Wheat open. Anyone and everyone with an interest in marketing is welcome to play any or all of these simulation games.

You must sign-up to compete in Commodity Challenge. The process is free, quick and easy, but it will result in one more username and password to memorize.

In the Iowa corn open, players market corn using futures and options quotes from the CME. Remember that you don’t have to farm in Iowa to play this game. I call it the Iowa open because the cash grain bids are real, and originate from North Central Iowa. I’ve been telling producers about the great opportunity to “sell the carry” in corn. This simulation game is great opportunity to try out this strategy (store corn and sell March, May or July futures). Watch the corn basis narrow from the current 100 cents under the July to 25-35 cents under next spring. Watch your margin account fluctuate as prices rise and fall.

In the Minnesota soybean open, players market soybeans using futures and options quotes from the CME. Again, you don’t have to produce soybeans in Minnesota to play this game. I call it the Minnesota open because the bids originate from Mankato, Minnesota. By the way, Mankato is home for two large soybean crushing plants. Use the soybean game to try a new tool. Are you tempted to sell your soybeans at harvest and “paper farm?” Try it out! Will you buy at-the-money or out-of-the-money call options? How much did they cost? When will you sell them?

Finally we have the Montana wheat open, where players market winter and spring wheat using futures and options quotes from the Kansas City Board of Trade and the Minneapolis Grain Exchange. North Dakota and Kansas wheat producers are welcome! Wheat bids originate from the Golden Triangle area of Montana. Are you holding wheat in storage? Watch the storage costs and, by the way, what is your exit plan?

There are no prizes for competing in these games, but we encourage side-bets with your neighbor or Uncle, should they decide to play the same game. The wonderful thing about these simulation games is that no one can get hurt. Then again, you might just learn something that makes you a better marketer of our own grain. Good luck! 

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