I would like to respond to the article “For farmers, an empty bounty” (Business, Aug. 2). A farmer’s livelihood need never be considered a “gamble.” At the Chicago Board of Trade, we are in the business of enabling farmers to control the many risks associated with the agricultural business. By enabling farmers to efficiently transfer risk and manage price through the use of futures and options, markets such as the CBOT are a sound and necessary part of thousands of farmers’ marketing plans.
Hedging–the buying and selling of futures contracts as a temporary substitute for the purchase or sale of the actual commodity–enables farmers to lock in a satisfactory price and control the pitfalls of the cash market, thus avoiding the dire situations that so many are in today.
