Beer and The Commodities Market

Most branded products and agricultural products are not commodities. However we will see the future as Cargill, Petroseed, Genetseed will have patented superior seeds which grow into corn, mustard seed, wheat, and other agricultural products which will have a brand name. There will be certain types of specialty corn which can be used for biofuels and will need to be separated from the regular corn as a separate commodity. Hops and Barley work the same way.

Some companies like Sunkist have attempted to brand name a commodity in order to get higher price. Some trade associations and some co-ops do the same thing. However, in the end something only worth what someone will pay. Starbucks with older plantations has excess capacity and therefore sells his excess capacity on the commodities market, or in an Intranet system on their web site for e-secured credit card consumers. Coffee actually keeps for longer than other types of commodities that are agricultural based. Therefore they can hedge their bets by stockpiling, roasting, or bagging the excess into little containers for later sale. Similar to the US Military stockpiling fuel so they will not run out.

Farmers often stockpile as well, putting their excess into silos. Many times fear of economic devaluation will change the price someone is willing to pay now for a contract to receive commodities and future. For instance a perceived economic slowdown may cause mustard seed to be worth less. Sometimes an economic slowdown may cause contract prices to go up. For instance in economics low times people buy more beer, therefore Hops and barley will be worth more so more beer can be produced, for all those people who lost jobs, sit at home, and watch the Jerry Springer show. So if you drink beer you are playing the commodities market from the back end while you sit on it? Think about it?

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs

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Beer and The Commodities Market

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