How do farmers use ADM for grain marketing bids?


Quick Answer

By streamlining grain delivery and weighing procedures, Archer Daniels Midland enables its clients to know the current price of grain when bidding at market. However, the actual process of bidding is still subject to the soft commodities market, wherein there is a typical supply and demand model in use.

Continue Reading

Full Answer

Archer Daniels Midland offers multiple options to its clients, including nine different contract types and custom contract varieties. Upon entering a contract with ADM, a farmer has access to its vast global distribution network for delivery of oilseed, corn and wheat. This infrastructure also allows a farmer's goods to reach newer markets in diverse areas overseas, and also opens up new bidding options. Other advantages for farmers working with ADM include crop insurance and risk assessment, investor and financial services, as well as access to 330 grain elevators in North America.

Some farmers opt not to pursue a contract with ADM, instead choosing to maintain their own marketing portfolios. However, those farmers are still subject to market changes, and without the foreknowledge of the current price of goods to assist with bidding. This creates other issues, such as with distribution and storage, in addition to loss of access to ADM's global infrastructure.

Learn more about Agriculture

Related Questions