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Safety Net - a mechanism used by governments to assist farmers in stabilizing their income.
Seasonality - the features of certain events, including farm production and farm product prices, to follow regular and predictable changes. These changes reappear every or nearly every calendar year. In farm production, the seasonal changes are usually in response to biologically-dictated production patterns. For example, in Alberta cull-cow prices decrease seasonally in the fall due to a seasonal increase in cow marketings.
Seeded Acres – the area seeded to a specified grain on an individual farm, in a province or region or nationally. Seeded acres does not equal harvested acres due to abandonment or use for other purposes such as grazing.
Selected and Accepted Oats and Barley - oats and barley of high processing quality for which a sample has been submitted to a processor or selector, working on behalf of a processor, and which have been accepted for purchase by the processor.
Seller’s Market – a condition in a market place where sellers are hard to find or the commodity is scarce so sellers can offer higher prices.
Selling or Short Hedge – selling futures contracts or buying put options to protect against a decrease in price of a commodity that will be sold into the cash market at a later date. See “long hedge” or “buyer hedge”.
Settle or Settled
- to establish a final price for
- to fix or resolve conclusively
- to make or arrange for final disposition
Settlement Price – the official daily closing price of futures contracts. Settlement prices are used by exchange clearing houses to determine both margin calls and invoice prices for deliveries. See also “closing price”.
Short-covering – see “Covering”.
Shipping Zone - a railway grain-shipping area, made up of two or more train runs, usually serviced from one railway service hub. A zone contains a group of shipping points served by the same rail company and includes all primary elevators, inland terminals or producer-car loading points located at those shipping points. There are seven CN Zones on the Prairies numbered one through seven. There are five CP Zones numbered 11 through 15. Some shipping points, such as Rosetown, are serviced by both CN and CP.
Shipping Point - a location on a railway line where one or more primary elevators receive, store and load grain into railway cars. A producer-car loading point is also a shipping point.
Short
- an individual who has sold a futures contract and who has not yet closed out that position by offsetting (buying) the contract.
- an individual who has sold an option (on futures) contract and who has not yet offset that position.
- an individual, or business, which has sold most, or all, of its inventory or has forward-sold its inventory. For example, an exporter that has arranged an export sale of a commodity but has not yet bought the commodity.
- the opposite of “long”.
Shrink or Shrinkage
- In livestock marketing, shrink is the weight loss of an animal that occurs during sorting, transportation, standing, or any situation that may cause the animal stress. See “pencil shrink”, “tissue shrink” and “excretory shrink”.
- The loss of weight in grain that occurs when grain is handled or treated. Beginning August 1, 2003, licensed primary elevators in Canada were not allowed to charge producers for shrinkage. Shrinkage deductions are negotiable at licensed process elevators, such as crushers and mills, and at grain dealers.
Sideways - a market where prices tend not to go above or below a certain range of prices.
Single Desk Selling Agency - a farm product marketing system where producers pool their product and sell through one authority, creating, in effect, a market with only one seller. The Canadian Wheat Board is an example.
Soft
- a market where the price is gradually weakening
- certain “soft” commodities such as sugar, cocoa and coffee.
Special Quota (Advanced Call) - a special Canadian Wheat Board call for grain deliveries announced to meet particular situations such as high-moisture grain for drying and flood threats. Advanced calls are also granted to estates or to producers retiring from farming.
Speculator – a person or business, which is willing to invest money and assume the risk of a price change. The speculator hopes to accurately predict the direction prices will move and, therefore, profit from the price change. For example, a speculator may invest in commodity futures, options, equities (stocks), real estate, grain in the bin or cattle in a feedlot.
Speculation - buying or selling of a commodity futures (or an options) contract for the purpose of offsetting the futures or options contract later at a profit or at the risk of loss. In short, risk bearing.
Spot – (rail transportation)
- “Spot” is the exact location where a rail car is located for loading after it is uncoupled from a train, as in “spot the car”.
- the number of rail cars that can be loaded at an elevator siding at any one time, as in “that elevator has a 100-car spot”.
Spot or Spot Sale or Spot Market – a market of immediate delivery to the buyer and payment to the seller for the product. Also, referred to as the “cash market”.
Spot Commodity - the actual physical or cash commodity, not the futures market for that commodity.
Spot Month – the futures month that matures and becomes the “deliverable contract” during the present month. For example, during the month of December, December futures is the spot month for hard red spring futures on the Minneapolis Grain Exchange.
Spot Price - the price at which the spot or cash commodity is trading. In grain trading, it is also called the "cash price".
Spread - the difference in price between two futures contracts. Spread usually means the price difference between two different futures months of the same commodity but it may mean the price difference between the same or similar months of two different commodities.
Spreading - futures (or options) trading strategies intended to take advantage of, and profit from, a change in price relationships. Some possible spreading strategies are:
- the purchase of one futures contract and the sale of another futures contract of the same commodity but in different months.
- the purchase of one futures contract of one commodity and the sale of that same delivery month of a different commodity.
- the purchase of one commodity in one market and the sale of the same commodity in another market.
- See “bull spreads” and “bear spreads”.
Squeeze – a market situation in which a lack of available cash supplies of a commodity means that holders of short futures must offer to buy back their positions at ever higher prices rather than buy the cash commodity to deliver against their short futures.
Steady - a market with prices basically unchanged from previous quotes.
Steer/Corn or Steer/Barley Ratio - shows the relationship of cattle prices to feeding costs. It is measured by dividing the price of a live slaughter steer, in $/hundredweight, by the price of corn or barley in $/bushel. When corn or barley prices are high compared to cattle prices, fewer units of feedgrain equal the value of 100 pounds of a slaughter steer. When corn or barley prices are low relative to cattle prices, more units of corn or barley equal the value of 100 pounds of live steer. The ratio shows the relative profitability of feeding cattle
Stockers - calves or light-weight yearlings destined for a period of slower weight gain on pasture or on a backgrounding ration before going on full feed.
Stocks-to-Use Ratio - the total carryover or ending stocks of a particular crop divided by that crop’s total annual usage for the same year. The ratio, expressed as a percentage, is a measure of the relative tightness of the supply-demand balance for that crop at the end of the crop-year. It allows a useful comparison between crop years over a relatively long period of time.
Stop Loss Order or Stop Order - a standing order to buy or sell when the market is at a specified price. A stop order becomes a market order when the commodity reaches the specified price. The purpose of a stop loss order is to limit losses or to safeguard a profit. See “market order”.
Strike Price - the futures price, specified in put or call option, at which a put or a call option becomes a futures position if the holder of the option exercises it. See also “exercise”.
Strong Hands
- When used in connection of delivery of commodities on futures contracts, “strong hands” usually means that the long receiving the commodity will retain ownership of the commodity.
- When used to describe futures positions, the term usually means futures and/or options positions held by trade interests or well-financed speculators that won’t quickly offset their positions.
Supply Management - regulation and control of production and marketing of an individual farm product through a quota system.
Switching – see “rolling” or “rolling forward”. |
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