Economist’s Web game allows
producers to buy, sell and trade –
with cyber money
By BECKY BOHRER of the
BILLINGS – For years, Terry Anvik
has sold grain the way most of his
neighbors do – he hauls it to the local
elevator and takes the price that’s
Often, he’s lucky to get enough to
cover his costs.
"All the cash prices I’ve seen for the
past four years have been below the
cost of production," said Anvik, who
grows wheat, barley and other crops
on his farm near Sidney in northeast Montana. "We’ve really been struggling to find a good price and
have relied heavily on the government to make up the difference."
But a new Internet-based commodity game developed by a Montana agricultural economist is giving
farmers like Anvik the chance to experiment with new ways of selling their grain, without risking real
The game, called Commodity Challenge, teaches farmers the basics of the cash, futures and options
markets. It simulates trades, letting producers practice with phantom cattle and grain allotments, as
producers compete to capture the highest prices. Commodity Challenge costs nothing more than the
time invested to learn.
Popularity of the initial game, played by more than 400 Montana farmers this spring, led to
development of an updated version that uses such real-time trading conditions as up-to-date prices
and offers an array of resources for following news and marketing trends.
It also has resulted in expansion of the game beyond Montana to farmers in Idaho, Minnesota, Texas
The six-month-long game begins in September. As many as 6,000 producers are expected to take
part, and the game could be offered nationally as early as next year.
The goal, said Kevin McNew, the professor of agricultural economics who developed Commodity
Challenge, is to teach farmers how to manage financial risks – not necessarily to turn grain farmers
into commodities traders.
"The thing about agriculture is, you can’t do things the way your dad did," McNew said. "Things are
constantly changing, farmers have more risk and it’s up to them to manage that."
It is estimated that fewer than 20 percent of American farmers and ranchers use futures and options
markets – hedging and locking in prices for cattle or grain before actually hauling them to the grain
elevator or sale yard. Such marketing is a gamble – both in time and money – but the payoff can be
worth it, game organizers say.
Farmers who did best playing Commodity Challenge this spring averaged 15 cents per bushel more
on their wheat and barley allotments than other players, said Alex Offerdahl, program coordinator of
Montana MarketManager, which helps farmers and ranchers manage financial risks.
MarketManager was spawned by the Montana Grain Growers Association and the Montana
If such prices were realized on a larger – real – scale, it would mean an extra $3.4 million in profits for
Montana producers, he said.
"Producers are tired all the time of hearing they receive all their income from the government. They
want to capture more income from the market," Offerdahl said.
"If we do a better job of teaching them to use those markets, farm payments would become less
important to them."
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