These three influences help to explain price variability. Trend variations are the overall direction of prices in the long run. They can increase, decrease, or remain flat. Cyclical variations are the price cycle that commodities experience during a several year time period. For example, the beef cycle is typically 10 years.
Seasonal variations are changes that occur in less than one year.
The worksheet for this step includes space for you to record your expectations for prices and to determine where the market is in the price cycle. Your price expectations will, in turn, help you decide which enterprises to include in your business. A farm business plan is a statement of how you intend to react to changes in the marketplace. It reflects your expectations about the market environment in which you will operate. It is for this reason that you are encouraged to specify your expectations as you begin the planning process.