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Abstract
The use of modern marketing strategies to minimize risk exposure is not a widely adopted
practice under maize producers. The producers tend to use high risk strategies which include
the selling of the crop on the cash market after harvested; while the current market requires
innovative strategies including the use of Futures and Options as traded on SAFEX.
However, due to a lack of interest and knowledge of producers understanding of modern,
complicated strategies the study illustrates by using a SERF and CDF that the use of three
basic strategies namely a Put-, Twelve-segment-, Three-segment- can be more rewarding.
These strategies can be adopted by farmers without an in-depth understanding of the market
and market-signals. The results obtained from the study illustrates that producers who tend to
be more risk neutral would prefer using the Twelve-segment- or Spot-strategy while a risk
averse producer would prefer the Three-segment-, or Put-strategy. It also indicates that no
strategy can be labelled as the all-time best and that the choice between strategies depends
on risk adverse characteristics of the producer. The purpose of the study is to prove that the
adoption of a basic strategy is better than adopting no strategy at all and to convince
producers to reconsider the adoption of modern marketing strategies.