|
| This is only offered for grain still in the farmers bins. Guys that hauled grain into the elevator in the fall still have to pay storage.
As to comments about security or collateral of dp grain, all you have to do is look at FSA's position on DP - once grain goes on DP ownership is forfieted. Yes, you had better know your elevator inside & out as there is a risk as it becomes unsecured dept as far as a bankruptcy court is concerned . Safest is to store & put the grain under a federal wharehouse receipt.
Yes, dp does work in the elevator's favor as they have control of the grain & can move it on which depress prices somewhat early on but at some point that grain has moved out of the system & through the production channels and needs to be replaced creating a demand for more grain. I would have to say that all the grain traded on paper by the CBOT has way more affect on prices than does grain placed under DP.
Other benifits is that the farmer has eliminated any of loss resulting from potential storage problems as well as letting the farmer move his grain to the elevator during a time period that may be more convinient for him without paying storage fees. Until last year, here in IN grain stored under open storage was assessed an "inventory tax" if held on Mar 1, either by the farmer if it was in his possession or in the possesion of the elevator. Depending upon the tax rate that could add up to as much as 4-5ยข/bu. In the past this has resulted in higher storage charges for open storage than it did for DP grain. I also might note that as far as price quotes, I have never been offered any difference in price based on whethher my grain was in DP or open storage.
Like anything, whether DP works or open storage works all depends upon the individual farmer & his situation. What works for you doesn't neccesarily work for me or vice versa.
| |
|
How much 06 corn is left in farmers hands?
