To understand the difference between seasonal, cyclical and trend forces. To learn how seasonals can be used to identify the timing of a market's major turning points and to predict the magnitude of price changes. Generally, crop prices set their seasonal low at harvest followed by a post-harvest rally. Post-harvest rallies occur because the supply of the crop is fixed and consumption gradually uses up that supply, causing prices to rise.
Seasonal forces are different from cyclical or trend forces.
A seasonal is one special type of cycle. A cycle is a continuous and self-sustaining price pattern which can occur over any length of time. Trends in crop markets are gradual, long-term changes that can have a powerful influence on markets and which may significantly alter seasonal patterns. Seasonals are useful for identifying the major turning points in prices as well as the magnitude of the change in prices. The relationship between existing or expected prices to costs of production should carry more weight than just making marketing decisions at the expected seasonal price extremes.