The article presents the example of using relations between the price of wheat flour sold by the milling companies and the price of wheat futures listed on the FOREX market to protect the companies from bakery sector ...The article presents the example of using relations between the price of wheat flour sold by the milling companies and the price of wheat futures listed on the FOREX market to protect the companies from bakery sector against adverse price movements of raw material--wheat flour. The paper aims to present a method which can help to reduce risk of changes wheat flour price in the market by using wheat futures traded at FOREX market. For the analysis authors used weekly data since January 2006 until October 2010 about wheat flour price, wheat grain price, wheat futures prices, quotes a currency pair USD/PLN. Wheat flour prices came from studies of the Department of Agricultural Markets, Ministry of Agriculture, and Rural Development in Poland and represented the average sales price of wheat flour by milling companies. Information about wheat futures and quotes a currency pair USD/PLN reflects the actual trading of the FOREX market. Authors used statistical analysis tool for determining the strength of the relationship between the price of wheat flour and the wheat price on the domestic market and the wheat futures price. The correlation coefficient between them was 0.763. For further test authors used seven different options that use future contracts to reduce fluctuations in the flour price which can be used in bakery businesses. These results of research show that someone can effectively use wheat futures contracts listed on the FOREX market to protect the bakery business against adverse movements of wheat flour prices. Application in practice chosen strategies can allow bakery companies to achieve cost advantages by reducing the adverse changes in the wheat flour prices. Chosen strategies are more efficient if the prices of flour in the domestic market are rising. If prices drop down, the effectiveness of using wheat futures contracts was lower. It should be noted that wheat futures contracts are a good tool to achieve cost advantages in the bakery industry, especially when the wheat flour prices are increased on the domestic market.展开更多
It’s known to all that under ideal condition the s to rage cost is kept in lower level when storage management be arranged by Economic Order Quantity(EOQ).Does this mean that any companies should set up their own sto...It’s known to all that under ideal condition the s to rage cost is kept in lower level when storage management be arranged by Economic Order Quantity(EOQ).Does this mean that any companies should set up their own storing system in proportion to the scale of the commodities’ producing or sell ing Furthermore, even if they manage storage in EOQ, because of different oper ation scale, geographical condition or ability borrowing money from financial ma rket, different companies pay unequal cost in storing the same commodity.In thi s paper, except for supplying commodities from our own storage system, the autho rs have analyzed other two supplying ways without whole storage system, they are forward contracts and futures contracts.The authors have discussed variable su pply cost for above different supply measures.According to the cost of each sup ply way, the managers can choose the most economical way in supplying the commod ity and predict the price of futures from storage management arranged by EOQ.Th e summary content is as follow: 1. The comparing of supply cost between forward contracts and storing system a rranged by EOQ. (1) The supply cost from forward contracts (2) The supply cost from storage system arranged by Economic Order Quantity (3) The application example for comparing cost in different supply way 2.The comparing of supply cost between futures going physical and storing syst em arranged by Economic Order Quantity. (1) The supply cost from futures going physical (2) The correlation between futures contracts and storage management arranged b y EOQ (3) The application example for comparing cost in different supply way 3.How does storing system of scale economic affect the price of forward and fu tures contracts (1) How does the price of forward and futures contracts fluctuate (2) How do we calculate the price of a commodity at future point from the cost of scale economic storing (3) How do we operate efficiently in derivatives market by using the cost of sc ale economic storing (4) The application example for analyzing the price of futures 4.The correlation among storage managementforward contracts and futures mark et.展开更多
文摘The article presents the example of using relations between the price of wheat flour sold by the milling companies and the price of wheat futures listed on the FOREX market to protect the companies from bakery sector against adverse price movements of raw material--wheat flour. The paper aims to present a method which can help to reduce risk of changes wheat flour price in the market by using wheat futures traded at FOREX market. For the analysis authors used weekly data since January 2006 until October 2010 about wheat flour price, wheat grain price, wheat futures prices, quotes a currency pair USD/PLN. Wheat flour prices came from studies of the Department of Agricultural Markets, Ministry of Agriculture, and Rural Development in Poland and represented the average sales price of wheat flour by milling companies. Information about wheat futures and quotes a currency pair USD/PLN reflects the actual trading of the FOREX market. Authors used statistical analysis tool for determining the strength of the relationship between the price of wheat flour and the wheat price on the domestic market and the wheat futures price. The correlation coefficient between them was 0.763. For further test authors used seven different options that use future contracts to reduce fluctuations in the flour price which can be used in bakery businesses. These results of research show that someone can effectively use wheat futures contracts listed on the FOREX market to protect the bakery business against adverse movements of wheat flour prices. Application in practice chosen strategies can allow bakery companies to achieve cost advantages by reducing the adverse changes in the wheat flour prices. Chosen strategies are more efficient if the prices of flour in the domestic market are rising. If prices drop down, the effectiveness of using wheat futures contracts was lower. It should be noted that wheat futures contracts are a good tool to achieve cost advantages in the bakery industry, especially when the wheat flour prices are increased on the domestic market.
文摘It’s known to all that under ideal condition the s to rage cost is kept in lower level when storage management be arranged by Economic Order Quantity(EOQ).Does this mean that any companies should set up their own storing system in proportion to the scale of the commodities’ producing or sell ing Furthermore, even if they manage storage in EOQ, because of different oper ation scale, geographical condition or ability borrowing money from financial ma rket, different companies pay unequal cost in storing the same commodity.In thi s paper, except for supplying commodities from our own storage system, the autho rs have analyzed other two supplying ways without whole storage system, they are forward contracts and futures contracts.The authors have discussed variable su pply cost for above different supply measures.According to the cost of each sup ply way, the managers can choose the most economical way in supplying the commod ity and predict the price of futures from storage management arranged by EOQ.Th e summary content is as follow: 1. The comparing of supply cost between forward contracts and storing system a rranged by EOQ. (1) The supply cost from forward contracts (2) The supply cost from storage system arranged by Economic Order Quantity (3) The application example for comparing cost in different supply way 2.The comparing of supply cost between futures going physical and storing syst em arranged by Economic Order Quantity. (1) The supply cost from futures going physical (2) The correlation between futures contracts and storage management arranged b y EOQ (3) The application example for comparing cost in different supply way 3.How does storing system of scale economic affect the price of forward and fu tures contracts (1) How does the price of forward and futures contracts fluctuate (2) How do we calculate the price of a commodity at future point from the cost of scale economic storing (3) How do we operate efficiently in derivatives market by using the cost of sc ale economic storing (4) The application example for analyzing the price of futures 4.The correlation among storage managementforward contracts and futures mark et.
