Download Development of Lender-Producer Marketing Networks to Mitigate

2014 Education Projects
Final Report
Development of Lender-Producer Marketing Networks
to Mitigate Financial and Price Risk through Education
on Futures, Options, and Contracts
Agreement Number: 21664-08
Funded Amount: $33,175
Project Director
Aaron Smith
Assistant Professor
University of Tennessee
2621 Morgan Hall
325-B Morgan Hall
Knoxville, TN 37996
865-974-7476
[email protected]
Mailing Address
University of Tennessee
325B Morgan Hall
2621 Morgan Circle
Knoxville, TN 37996
Fax: 865-974-7484
Financial Contact
Courtney Holbert
University of Tennessee
Office of Sponsored Programs
2621 Morgan Circle
224-E Morgan Hall
Knoxville, TN 37966
865-974-7390
[email protected]
Co-Project Director(s)
Andrew Griffith
University of Tennessee
2621 Morgan Circle
314 Morgan Hall
Knoxville, TN 37996
[email protected]
Project Contact
Aaron Smith
Assistant Professor
University of Tennessee
2621 Morgan Hall
325-B Morgan Hall
Knoxville, TN 37996
[email protected]
Project Steps
Project Steps
What project team does
What
participants do
1. Meet with collaborators to discuss
program materials, available dates,
and formulate meeting agendas.
2. Plan and develop educational
materials related to futures and
options and other marketing contracts
for presentation and distribution at
marketing meetings and on-line.
Develop initial questionnaires and
program evaluation surveys.
3. Develop an online curriculum of
short videos approximately 5 to 8
minutes each describing market
terminology, market participants,
marketing alternatives, how to
interpret market information,
development of a marketing plan, and
examples of particular marketing
strategies.
4. In conjunction with regional and
county Extension personnel establish
meeting dates in Greenville/White
Pine, Lawerenceburg, Fayette/Tipton
County, and Robertson County.
Market and promote the marketing
meetings through Extension
personnel, online, collaborators, and
university/producer newsletters.
5. Conduct initial meetings in all four
locations. Evaluate via survey current
knowledge and level of use of
marketing contracts and
futures/options. Two collaborators
present and provide expertise in their
respective fields. Record one meeting
and make it available on the UT Crop
Economics web page for those
unable to attend.
6. Asses the current level of
understanding of the marketing
groups and adjust content
accordingly.
Not Applicable.
Done?
Actual # of
participants
When
completed
√
6
September
Not applicable
√
5
March
Not Applicable.
√
5
September
Not Applicable.
√
12
June
Complete
introductory survey
and commence
educational
program.
√
0
July
Not applicable
√
8
March
7. Second marketing meeting
conducted in all four locations. Final,
two collaborators provide expertise
and discuss their participation in the
marketing/risk management process.
Continue the educational program
from previous meetings.
8. Conduct third marketing meeting.
Team members are in different
locations for presentations and all
groups are connected via web
conference. Allow for open
communication/discussion of topics in
all four locations. Controlled through
project directors and co-directors.
9. Conduct fourth marketing meeting.
Using the same format as the third
marketing meeting. Discuss options
of continuing educational meetings
under a similar format or through
alternative mediums.
10. Project team members and
collaborators will examine participant
evaluations and discuss successes
and short comings of the program
that can aid in the delivery of future
meetings.
Attend meetings
and interact with
collaborators and
other participants.
√
0
June
Commence
development of
marketing plans.
Those interested
may sign up for
virtual trade
account to allow
for simulated real
time trading of
futures and
options.
Complete
marketing plan and
program
evaluation.
√
0
August
√
26
December
Not applicable.
√
6
December
Promotional Materials
Greenville Marketing Meeting Flier
Meeting Flier
Meeting Postcard (Middle TN meeting)
Southern Middle TN Meeting (announcement email)
Educational Materials
Understanding and Using Cattle Basis in Managing Price Risk
Using Futures Markets to Manage Price Risk in Feeder Cattle Operations
Commodity Options as Price Insurance for Cattlemen
Crop Economics - Risk Management and Marketing
Evaluations and Reports
Meeting evaluation form
http://rvs.umn.edu/Uploads/EvaluationsReports/8e98a222-4cbd-4c8b-b691-5ff1d7783097.pdf
Comment: Meeting evaluation from for first meeting.
Date of Evaluation/Report: Tuesday, September 30, 2014
This Evaluation/Report is not viewable by the public.
Results
What Producers Will Learn, Achieve, Apply
Proposed Result
Topic
Producer
action
When
measured
Est
#
Act
#
How verified?
1. Enhanced lender
understanding of
futures, options, and
contracts to assist in
loan adjudication and
maintenance.
Financial
records
and
analysis
Understand
After
program
50
32
Written evaluation
2. Improved producer
understanding and
use of futures,
options, and
marketing contracts
that can mitigate
price and financial
risk.
Cash and
futures
pricing
tools
Understand
Before and
after the
program
200
205
Pre and post written
assessment of
starting and ending
knowledge.
3. Strengthen
producer-to-producer
dialog and producerto-extension educator
dialog to improve risk
management plan
development beyond
the project timeline.
Business
and
strategic
planning
Decide
After project
50
32
Survey after the
project
4. Producers will
develop a written
marketing plan for the
forthcoming
marketing year.
Marketing
plans and
strategies
Develop
End of the
program
50
30
Collection/ verification
of a written marketing
plan.
5. On-line curriculum
of 5-8 minute videos
and supporting
documentation for
different marketing,
financial, and price
risk management
strategies.
Marketing
plans and
strategies
Develop
Before the
program
500
2161
Google analytic and
extension
agent/producer/lender
feedback.
6. Improve county
and regional
Extension personnel
understanding of
marketing contracts,
futures, and options.
Marketing
plans and
strategies
Understand
At the end
of the
program
20
26
Initial questionnaire at
the onset of the
program with a follow
up questionnaire
upon completion.
Number of Participants
Total Number of Participants:
290
Project Overview
The objective of this educational program was to develop a marketing network where Extension
personnel, agricultural producers, and lenders could learn about futures, options, and contracts as
a method to reduce price, marketing, and financial risk for row crop and cattle operations in
Tennessee. The program was delivered through 13 in-person marketing meetings in four regional
locations. Educational information and printed materials from the meetings are available on-line.
The audience that participated in the program was comprised of producers, agri-industry
personnel and Extension agents. Participants benefited through improved understanding of how
marketing and risk management tools mitigate price, marketing, and financial risk. The program
will reached 290 people directly through marketing meetings.
Project Comments
Describe any unexpected results of the project:
After our online meetings occurred the audience was informally asked about the online (ZOOM)
meeting platform and how they perceived the effectiveness of the technology. Overall
participants were supportive of the technology. With comments such as "its useful to hear what
producers in other counties are doing". One downside to the technology is the quality of the
internet connection directly correlates with how the technology is perceived. One very rural
location had difficulty maintaining a steady connection and consequently feed back was less
positive at that location.
Recording the Zoom meetings was a useful tool to allow those that could not attend the meeting
(either in person or online) to view content at a alter time; however given the length of the
average meeting, 2-2 1/2 hours, it was difficult to redistribute the content and/or edit it into
concise topical/shorter videos. We need to continue to explored additional alternatives to
repackage/distribute recorded content as our current platform is not conducive to accomplish
this.
How would you improve this project if you were to do it again?
Lenders were willing to attend the meetings (and provide sponsorship) however it was
exceedingly difficult to have them engage in the content and the discussion within the group. A
lenders/agri industry only group may be more willing to actively participate in the discussion.
We also learned early on in the project that targeted meetings, both timing and commodity
specific, enhanced producer participation. For example,4 meetings on an irregular schedule for
individual commodities were likely more productive for targeted producer groups than quarterly
meetings.
Determine a better method to allow participants to view meetings that were missed.
What were the keys to success for your participants?
Producer meetings that were smaller (6-15 participants) were far more engaged than larger
groups. This was likely due to fear of speaking out in front of a large group and divergence of
marketing and risk management knowledge within the group (i.e. some participants were more
familiar with futures options and marketing contracts than others).
Active engagement in the discussion was imperative to understanding the tools discussed. Once a
producer saw value behind the material and started working through strategies on his/her own
they became more engaged with the group and started challenging the instructors with different
marketing and risk management scenarios.
Individual stories / Quotes
A producer that regularly attended our marketing meetings entered the program with a greater
knowledge of marketing and risk management tools than your typical producer; however he had
not actively traded futures and options. He was very engaged in the process and often developed
complex marketing strategies that would challenge the instructors knowledge. By the end of the
program he was bringing in his self directed brokerage account statements and sharing his actual
results and strategies with the instructors.
Quotes (from questionnaires, completed unanimously):
“Thank you for your extensive knowledge & presentation. Appreciate very much your print
outs.”
“Very good information. Very detailed information. Much needed!”
“Excellent program! This really helped simplify the tools available. I look forward to future
meetings on this topic. Thank you for all your hard work in compiling and delivering this
information.”
Leveraged Resources
ERME grant funds allocated::
33,175
ERME grant funds expended::
32,108
Other funds used for the project::
250
Non cash resources::
30,000
Delivery Area
Total Meetings:
Total Meeting Participants:
Total Meeting Participant Hours:
Total Webinars:
Total Webinar Participants:
Total Webinar Participant Hours:
Total Website Visits:
Total Online Course Participants:
15
290
0.00
0
0
0
2161
0