These dynamic contracts are ideal for producers who are comfortable with brokerage accounts and like to take a hands-on approach to marketing.
- Opportunity for greatest upside potential
- No minimum quantities
- Offered even when the market is closed
- Susceptible to market volatility
Sell Grain with Confidence
Needing to deliver grain soon but not happy with today’s cash price? Believe futures prices have upside potential in relationship to the current market? Focal Point allows you to sell grain when you need, knowing that you can be “hands-on” in expressing a market bias.
- You establish an initial Focal Point price on a selected futures reference month and then re-price at a later date, allowing you to stay in the market.
- The resulting gain or loss from that initial price then becomes a part of your final contract price.
When is Focal Point a Solution for Me?
Focal Point is for new grain contracts when you feel that futures prices have upside potential. It can be a good solution for when you need to transfer ownership of grain due to space limitations, grain condition or financial need. Utilize the contract when you are confident that futures prices in the selected futures reference month will improve and you are comfortable without an absolute price floor.
What are the advantages of the Focal Point contract?
- Freedom to deliver grain when you need to during harvest or due to storage limitations
- Ability to participate in market movement and potentially capture upside market moves
- Freedom to choose the timeline on participating in the market
- Offers an alternative to paying No Price Established (NPE) costs or storage fees
- Option for automatic discipline and execution to capture a cash price goal
- Advance physical payments may be made for delivered production; advance levels may vary by location
With markets in flux, locking in a guaranteed floor price can provide needed confidence in your marketing plan. Cargill Minimum Price allows you to select a floor price of your choosing, maintain upside, and retain the control to price out at anytime. There are a wide variety of additional strategies and combinations that can be utilized as part of a Minimum Price contract depending on your market outlook.
When Is it Used?
Minimum Price is a complement to any grain marketing plan at any time of year. It provides a floor price to insulate you from a volatile world—while maintaining upside participation.
What are the advantages of the Minimum Price contract?
- Investments are deducted from the contract price, not paid up front
- Trade at any time of the day regardless of the market being open or closed
- Write the contract for any quantity
- You establish the floor of your choice
- You establish the pricing period of your choice
- There are a variety of available strategies using put or call premiums in combination
- You can convert a variety of contracts to Minimum Price contracts
- You do not own an option, it is being used as a re-pricing mechanism
Information provided is general in nature and is provided without guarantee as to results. The information is not intended to be, and should not be construed as, trading, financial, legal, or tax advice. No warranty is made with regard to the information or results obtained by its use. Cargill, Incorporated, its subsidiaries, and affiliates disclaim any liability arising out of your use of, or reliance on, the information.