New Economic Realities:
Taking Charge of Risk

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Table of Contents
for Instructors Guide:
Taking Charge of Risk Workshop

1. Workshop objectives
   1. Flyer describing workshop (Microsoft Publisher format)
   2. Experiences and evaluations from previous workshops
2. Setting the stage
1. PowerPoint
2. "Introduction to Risk Management: Understanding Agricultural Risks" RMA Bulletin (Go to http://www.rma.usda.gov/pubs for information)
3. "Building a Risk Management Plan: Risk Reducing Ideas That Work" (Adapted from Farm Futures magazine. Hard copy also available through RMA/USDA. Go to http://www.rma.usda.gov/pubs for information
3. Case study farm and "game"
1. Purpose of module
2. PowerPoint
3. Harvest futures price probabilities given information in February 2001 and expected basis
   1. Corn on Dec 2001 contract
   2. Soybeans on Nov 2001 Contract
4. Yield probabilities
5. Storage costs for post-harvest storage decision
4. Managing financial risk
   1. PowerPoint (R. Betz, January 23, 2001)
   2. Co-ordinated financial statements (balance sheet, income statement, cash-flow statement) for the case farm (Excel)
      1. Low Debt (txt file)
      2. Medium Debt (txt file)
      3. High Debt (txt file)
   3. FinPak file used to generate case farm studies (R. Betz, January 23, 2001)
   4. "Cost" of production worksheets to define revenue requirement to cover economic cost, to meet the cash flow requirements and to maintain current equity (also available as an Excel file)
   5. Measuring Financial Performances A Critical Key to Managing Risk Fact Sheet Rich Text Format | Word 97 (and later)
   6. Financial Ratios Used in Financial Management Fact Sheet
5. Using crop insurance to manage revenue risk
   1. PowerPoint
   2. Crop insurance plan worksheet (Excel version)
   3. Spreadsheet to Budget Impact of Crop Insurance & Pre-harvest Pricing (February 6, 2001)
   4. "Crop Revenue Insurance Plans" (Prepared for 2000; minor changes are needed for crops and locations where the programs are offered and coverage levels. Also, note subsidy levels must be updated to reflect the Agricultural Risk Protection Act of 2000. Hard copy also available through RMA/USDA. Go to http://www.rma.usda.gov/pubs for information)
6. Pricing to manage revenue risk
   1. PowerPoint
   2. Table of cash for price offer based on futures and expected basis and the probabilities of alternative harvest prices
   3. Spreadsheet to Budget Impact of Crop Insurance & Pre-harvest Pricing (February 6, 2001)
   4. Historical review of futures price changes between pre-plant and harvest for corn and soybeans
   5. Strategic and tactical planning Fact Sheet
   6. Commonly Used Grain Contracts Fact Sheet
7. Executing the game
   1. Purpose of module
   2. Instructions for running the game (RTF format)
   3. Envelope with randomly determined, using market information, price offers and realizations and randomly determined yield realizations
   4. Worksheet to summarize results of plan and pricing yield realizations (also available in Excel file format)
8. Evaluation
   1. Evaluation form (MS Word format)
9. Appendix (WWW Site)

    

 Last updated: 06/28/2001

Taking Charge of Risk