Cogdill Farm Supply, Inc.

At Cogdill Farm Supply we are committed to helping you achieve consistent profitability in your grain operation. As part of this commitment, we have always been prepared to receive and purchase your grain at fair and competitive prices. This year we are adding two new grain contracts, Target and Price Later (DP), to our existing lineup of grain marketing services. Stop in to any of our locations, or call Rob Cogdill at (712) 269 – 5849 for additional information.

Cash Sales & Forward Contracts
As always, Cogdill Farm Supply will continue to purchase grain by cash sales and forward purchase contracts. Cogdill Farm Supply is prepared to offer forward contracts through the next crop year; please call to receive bids on any delivery periods for which prices have not been posted.

Basis Contract
Basis contracts allow you lock in basis values versus the Chicago Board of Trade while delaying final pricing until a later date. Basis contracts are most effective when used in conjunction with a target contract to achieve a desired futures price.

Minimum Price Contract
Minimum price contracts allow you to set a floor price for your grain while keeping the option to set a final price at a later date if the market moves higher, and are an alternative to storage. Minimum price contracts can be paired with forward contracts as well as cash grain sales. An additional advantage is the ability to cancel undeliverable portions of the contract for a pre-determined fee prior to final pricing in the event of a crop failure. Minimum price contracts involve service charges for the re-pricing and cancellation features which vary depending on the desired configuration of the contract and market factors. A target may also be placed to achieve a desired increase in the futures.

Target Contract
Target contracts can be used to price forward contracts or to sell grain from storage, and are designed to take the emotion out of your selling decisions. Simply specify your target price, delivery period, how many bushels you want to sell at that price, and the duration of the contract (i.e. “good ‘til cancelled”, etc.). Once placed, your target order is active during both the day and overnight market sessions. There is no charge to establish target contracts, you can have multiple target orders working for you at the same time, and you can modify the target level any time before the target is achieved. Target orders for less than 2,500 bushels require $0.01 discount to basis to cover additional hedging costs.

Price Later (DP) Contract
Price later contracts are another alternative to open storage and warehouse receipts which allow you to deliver grain to the elevator when it’s most convenient, while retaining the right to set the price at a later date. Unlike storage and warehouse receipts, however, title to the grain is transferred to the elevator upon delivery. Depending on market factors and space considerations, the service charges on price later contracts may be lower than open storage and warehouse receipts. Additionally, corn delivered to the elevator on a price later contract will be dried and shrunk to 15%. DP contracts should not be confused with basis contracts, which have also been used to defer pricing, but only after setting a fixed basis.