Paul Harris's Premium Offer Story
South Australian grain grower Paul Harris is gradually taking over the family farm and taking on the responsibility that comes with it. He is determined to secure the future of his business by achieving full price potential for his crops through smart marketing strategies.
In 2015 he used AWB’s Premium Offer Contract to enhance his old crop price by $15 per tonne.
“The extra money was a huge bonus,” he said. “Marketing is a big part of our business and we are trying to put a lot more effort into that side of things. My father used to put everything in the pool, but it’s a lot different now. You have to chase all the cash prices and different contracts and take more control of the marketing.”
Premium Offer allowed Paul to access a price premium in exchange for an offer to sell an additional equivalent quantity of grain to AWB in the future, at a price he set. “The (wheat) market never reached Paul’s target price for the additional quantity, but Paul still received the Premium.”
“We only offered 500 tonnes so we were still in the market for other contracts during that time,” he said. “The way you do your marketing can make you or cost you a lot of money. If you’re not watching the markets you can grow a crop all year and then lose a heap of money. The market can drop 10 per cent overnight when you’re dealing with commodity prices.”
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