Optimal Cash Purchase Strategies to Reduce Fertilizer Price Risk

Abstract

Fertilizer price volatility has increased dramatically. This research examines cash purchase and warehouse strategies. Seventeen years of Oklahoma fertilizer prices are examined. The results indicate that mechanical cash purchase strategies can be used to reduce the average cost or variance for fertilizer. Optimal purchase dates are also identified.fertilizer, price risk, seasonal price pattern, Agribusiness, Crop Production/Industries, Farm Management,