Change was the watchword of the political season, but volatility may be the best description of agriculture, says Nueces County, Texas, farmer Jimmy Dodson. And that volatility may alter the way farmers look at risk. “We now have to do just as good a job managing risks as we do in managing yields,” says Dodson. “Our risk profile has changed and volatility (in both production costs and commodity prices) is a bigger factor.” The volatility in markets has even disrupted risk planning for professionals, he says. “Strategies that have worked in the past have not worked recently, and may be less reliable in the future. Historic high basis levels caused grain prices received on hedge-to-arrive contracts to be more than a dollar a bushel less than expected.
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