Introduction

Risk Management in Commodity Markets`for Policy Makers

A practical course on the use of commodity futures & options

The course is rescheduled

Brussels 23 - 24 June 2010

Introduction
Price volatility in commodity and energy markets increased dramatically over the past few years caused by changes in the political and economic environment, the new green energy applications of commodities and new rising economies (Brazil & China). The increase in price volatility causes a keen interest from companies and governments in risk management instruments, in particularly futures and options contracts. During the past three years, the trade volume of these price-risk management tools increased with an average of 45%. Futures & option markets are available for many (agricultural) commodities, metals, and energy products. The question arises how policy makers can anticipate on these developments and what policy implications these developments have? Before policy makers can answer these questions a clear understanding of the functioning of (commodity) risk management instruments is needed.

Course delivers tools
This two day course focuses on how commodity futures and options can be used by farmers and the commodity industry to effectively manage risk. This course provides participants insight in risk management strategies with futures and options contracts that yield high hedging effectiveness and will provide strategies that can be used to capitalize on changes in price relationships. By means of examples and guest lecturers by professionals who are authorities in their respective fields participants will experience and learn how commodity futures and options can be used effectively. In addition, the course will relate the use of futures contracts to policy measures: are futures and options complements or substitutes for policy measures?

Content of the course
Pre-reading materials

• Background commodity futures markets
• Practical brochure on futures trading
• Document on option strategies
• Literature selected by FS-Innovators B.V.

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