Grain pools in spot­light this har­vest

North East & Goulburn Murray Farmer - - HAY AND SILAGE -

WITH low grain prices, grain pools are likely to get the at­ten­tion of grow­ers this har­vest.

To meet that de­mand, Avan­tA­gri Aus­tralia has re­leased three new prod­ucts, in time for the 2016-17 har­vest.

Avan­tA­gri was es­tab­lished by Peter Woods (for­merly of Wheat Ex­port Aus­tralia) and Mal­colm Bartholo­maeus (for­merly of Cal­lum Downs Com­mod­ity News and ProFarmer) and has been pro­vid­ing pool prod­ucts to Aus­tralian grain grow­ers for the past three sea­sons.

“Pools force grow­ers to ac­cept the price and re­turn se­lected by the pool man­ager,” pool man­ager Mr Bartholo­maeus said.

“Every­one gets the same re­sult, but some grow­ers might be hap­pier with quicker re­turns, or need to hold out for bet­ter prices.

“The ben­e­fit of the Avan­tA­gri prod­uct is that we han­dle all the stor­age fees and levies for you, find the best price when you want to sell, and can pay an ad­vance against the grain in the mean­time.”

Ini­tially Avan­tA­gri pro­vided three prod­ucts that gave mar­ket ex­po­sure for three, six and nine months af­ter har­vest.

They also of­fered a range of pay­ment op­tions cover­ing ad­vance, monthly and de­ferred pay­ments.

In 2015 the busi­ness in­tro­duced its tra­di­tional pool, which paid out 80 per cent of the es­ti­mated net re­turn at har­vest, and 20 per cent in July.

This proved to be pop­u­lar, with its high cash­flow up front and its in­her­ent in­su­la­tion against post har­vest price falls, while still re­main­ing open to some up­side.

This year Avan­tA­gri is mov­ing to give bet­ter ser­vice to the longer-term post-har­vest mar­ket with its new Avan­tA­gri man­aged pool.

Down­side price risk is ac­tively man­aged while giv­ing ex­po­sure to the up­side well into the year fol­low­ing har­vest.

If com­bined with an ad­vance at har­vest, this prod­uct can de­liver strong cash­flow and higher re­turns if the mar­ket ral­lies strongly.

Some grow­ers are happy to mar­ket their own grain, but af­ter sev­eral low pro­duc­tion years are look­ing to max­imise cash­flow.

Avan­tA­gri has de­vel­oped its self-man­aged pool for these grow­ers.

Wheat, bar­ley or canola can be trans­ferred to Avan­tA­gri with an ad­vance of 60 per cent of the es­ti­mated value be­ing paid within three days.

The grower de­ter­mines when sales are made.

The third prod­uct, the Avan­tA­gri Flexi Pool, gives the grower more flex­i­bil­ity with pay­ment streams, who buys your grain, and can even cover a whole range of grains that might be stored on farm, and not just in third party bulk stor­age fa­cil­i­ties.

POOL­ING RESOURCES: Avan­tA­gri di­rec­tors Mal­colm Bartholo­maeus and Peter Woods.

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