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UFS student attends COP27 Simulation Model in Egypt

26 September 2022 | Story Anthony Mthembu | Photo Supplied

Letsatsi Lekhooa, a UFS student who was selected to be part of the COP27 Simulation Model.

Nearly 150 students from across the world will gather in Egypt for the COP27 Simulation Model from 9 September to mid- October 2022. Among them will be Letsatsi Lekhooa, a Master of Science student specialising in Climate Change from the University of the Free State (UFS).

Lekhooa was one of 150 students from a pool of more than 1 800 applicants across the world who were selected to be part of this prestigious initiative. “This opportunity is appealing, because as young people we need to work hard to not only ensure that we break through walls, but to also represent our university well everywhere we go,” Lekhooa indicated.

The COP27 Simulation Model

The COP27 Simulation Model, which is organised by the British University in Egypt along with the United Nations Development Programme (UNDP), is a worldwide climate conference led by and targeted at the youth. The conference is important for several reasons, such as encouraging conversations around climate action among the youth. As it stands, the initiative is split into two categories, which include the hybrid capacity-building programme that started in September, and the COP27 Mock Conference set to begin in October. Lekhooa is currently engaged in the online capacity-building programme, which he describes as a learning curve. “Every day I learn something new, and I enjoy it because the process is assisting me in learning more about this climate change issue,” Lekhooa expressed.

The benefits of attending the COP27 Mock Conference

Although the first leg of the COP27 Simulation Model is online, Lekhooa will get the opportunity to travel to Egypt and physically be part of the COP27 Mock Conference on the campus of the British University in Egypt. As such, he hopes to take away as much as possible from the experience. “I hope to learn about the ways in which I can better communicate this climate change issue, not only in my home country of Lesotho, but generally in Southern Africa,” said Lekhooa. Furthermore, through his interactions with international scholars, he hopes to create and encourage a collaborative spirit to battle climate change.

The experience does not only serve as a learning curve for Lekhooa, but it is also one of the key steps that will allow him to reach a life goal. “I would like to be an international consultant in bodies such as the Intergovernmental Panel on Climate Change (IPCC), and the United Nations Framework Convention on Climate Change (UNFCCC), as they play a key role in making decisions on climate change,” Lekhooa highlighted.

News Archive

Producers to save thousands with routine marketing strategies, says UFS researcher

2014-09-01

Photo: en.wikipedia.org

Using derivative markets as a marketing strategy can be complicated for farmers. The producers tend to use high risk strategies which include the selling of the crop on the cash market after harvest; whilst the high market risks require innovative strategies including the use of futures and options as traded on the South African Futures Exchange (SAFEX).

Using these innovative strategies are mostly due to a lack of interest and knowledge of the market. The purpose of the research conducted by Dr Dirk Strydom and Manfred Venter from the Department of Agricultural Economics at the University of the Free State (UFS) is to examine whether the adoption of a basic routine strategy is better than adopting no strategy at all.

The research illustrates that by using a Stochastic Efficiency with Respect to a Function (SERF) and Cumulative Distribution Function (CDF) that the use of five basic routine marketing strategies can be more rewarding. These basic strategies are:
• Put (plant time)
• Twelve-segment pricing
• Three-segment pricing
• Put (pollination)(Critical Moment in production/marketing process), and
• Pricing during pollination phase.

These strategies can be adopted by farmers without an in-depth understanding of the market and market-signals. Farmers can save as much as R1.6 million per year on a 2000ha farm with an average yield.

The results obtained from the research illustrate that each strategy is different for each crop. Very important is that the hedging strategies are better than no hedging strategy at all.

This research can also be applicable to the procurement side of the supply chain.

Maize milling firms use complex procurement strategies to procure their raw materials, or sometimes no strategy at all. In this research, basic routine price hedging strategies were analysed as part of the procurement of white maize over a ten-year period ranging from 2002–2012. Part of the pricing strategies used to procure white maize over the period of ten years were a call and min/max strategy. These strategies were compared to the baseline spot market. The data was obtained from the Johannesburg Stock Exchange’s Agricultural Products Division better known as SAFEX.

The results obtained from the research prove that by using basic routine price-hedging strategies to procure white maize, it is more beneficial to do so than by procuring from the spot market (a difference of more than R100 mil).

Thus, it can be concluded that it is not always necessary to use a complex method of sourcing white maize through SAFEX, to be efficient. By implementing a basic routine price hedging strategy year on year it can be better than procuring from the spot market.

Understanding the Maize Maze by Dr Dirk Strydom and Manfred Venter (pdf) - The Dairy Mail

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