MARKETING TOOLS FOR COSHOCTON GRAIN COMPANY
CASH OR SPOT SALES
~ Our cash price is established on the close of the market trade each day for business transacted that day.
~ Any bushels spotted during weekend business hours will have the Friday afternoon posted cash bids used for settlement.
~Settlements of cash sales are made each Tuesday and Friday following delivery upon request.
OPEN ORDERS (PRICING TARGETS)
~ We offer this as a free service to aid in establishing desired prices for contracts and DP grain, and may be placed any day CGC is open for business.
~ Quantity, cash price, delivery month, and delivery location are chosen by customer at time of the request. These factors may all be adjusted; or the order cancelled; up to the point that the order fills at CBOT. Once the order fills it becomes binding.
~ Open orders are placed on the Globex trading market and are in place 21 hours each trading day,and remain in effect until they fill or the customer chooses to cancel the order.
~ Open Orders can be used to price any or all grain in DP and/or make a futures contract of, at least the minimum quantity bushel amount.
** Would be used to achieve desired pricing opportunities for contracts or DP grain.
FORWARD PRICED CONTRACTS
~ Basis, CBOT price, quantity, and delivery time are established at time of sale.
~Forward contracts can be made anytime CGC is open for business, with the possible exception of large quantities that may need to be traded on the Globex during trading hours.
~ Minimum quantity for contract is 500 bushels.
** Would be used when customer is satisfied with all aspects of the contract value and delivery.
BASIS CONTRACTS
~ Basis, quantity, and delivery time are established at time of sale which can be placed anytime CGC is open for business, however, pricing is at a later time when customer is satisfied with futures price.
~ An 80% advance is paid on the Tuesday or Friday following completion of delivery of contract.
~ Can be rolled from one futures month to a deferred month. Cost is $0.01 per bushel plus the board spread when each roll is done. Contract must be priced or rolled prior to first notice day or we will automatically roll to the next futures month.
~ Must be priced or rolled during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15PM any weekday the CBOT is open for trading.
~ Minimum quantity for contract is 500 bushels.
** Would be used when: a). customer is still bullish on price of the futures but feels the basis will weaken. b). customer is still bullish on the futures, but needs to generate cash flow, or c). customer is still bullish on the futures price but feels further basis appreciation will be less than interest cost and/or storage costs combined.
DELAYED PRICING AGREEMENTS
~ We offer this program on a reservation and/or spot basis.
~ Our current delayed price rates are posted in the scalehouse and on this website. The rates may also be obtained by calling our office staff.
~ All charges are figured from the date of delivery until date of pricing and are deducted from the settlement. Settlements are made each Tuesday and Friday following pricing.
~ From time to time we will offer space reservation for harvest delivery. You can use these opportunities to ensure that you have a place to deliver your grain.
~ We will charge a reservation fee which will be credited towards your delayed price charges when you price your grain. This agreement is for new crop delivery only.
~ We will guarantee your reservation rate or the rate at time of delivery, whichever is lower.
~ If market conditions change and you decide to forward contract grain for harvest delivery rather than use your reserved space, we will credit your sale price with your reservation fee on an equal number of bushels if notified by August 15 th to make this change.
~ Only if you do not use your space and do not sell us grain for harvest delivery will you forfeit your reservation deposit.
HEDGE-TO-ARRIVE CONTRACTS
~ In the absence of extremely volatile and unstable market conditions we will offer this type of contract whereas the Globex futures price, quantity, and futures month are established at the time of the sale.
~ Basis and delivery time are established at a later time, prior to delivery of grain.
~ A service fee of $0.05 per bushel for current crop year and $0.05 per bushel for next crop year will be applied to establish and carry this type of contract with an open basis.
~ Can be rolled from the established futures month to a deferred month, only within the same crop year.
~ Cost for roll is $0.01 per bushel plus or minus the spread value.
~ Must be rolled or basis set on or before first notice day or we will automatically roll to the next futures month for you.
~ A service fee of $0.04 per bushel will be applied to any contracts that are delivered to a facility other than Coshocton Grain Company.
~ All transactions must be conducted during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15 PM any weekday the CBOT is open for trading.
~ Minimum quantity for this contract is, 2,500 bushels for soybeans, and 2,500 bushels for corn.
** Would be used when customer is satisfied with the futures price but feels the basis will appreciate prior to delivery of the grain, and/or when the customer is satisfied with futures price but feels spread values on the futures will work in his favor.
MINIMUM PRICE CONTRACTS WITH CALL OPTION PURCHASE
~ Basis, quantity, delivery month, CBOT futures price, option strike price, and minimum price of contract are established at time of sale.
~ Contract value will be paid following delivery.
~ A call option (with strike price and futures month chosen by customer) is purchased and the
premium price plus $0.02 per bushel service fee is deducted from the contract price to establish the minimum price.
~ Customer has the right to cash-in (sell) the call option any time before expiration date. Any residual value after the sale will be added to the minimum price established at time of sale.
~ All transactions must be conducted during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15 PM any weekday the CBOT is trading.
~ Minimum quantity for these contracts is 5,000 bushels.
** Used to establish a price floor yet maintain the ability to add value to the sale if prices rally.
MINIMUM PRICE CONTRACTS WITH PUT OPTION PURCHASE
~ Basis, quantity, delivery month, put option strike price, and minimum price of contract are established at time of sale.
~ Contract value will be paid following delivery.
~ A put option (with strike price and futures month chosen by customer) is purchased and the premium plus $0.02 per bushel service fee and the basis is deducted from the strike price to establish the minimum price.
~ Customer has the right to cash-in (sell) the put option any time prior to expiration date. Contract will become a basis contract and its value will be adjusted to reflect gain or loss versus the original purchase premium put option.
~ All transactions must be conducted during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15 PM any weekday the CBOT is trading.
~ Minimum quantity for these contracts is 5,000 bushels
** Used to establish a price floor yet maintain the ability to add value to the sale if prices rally.
MINIMUM / MAXIMUM CONTRACT
~ In the absence of extremely volatile and unstable market conditions we will offer this type of contract whereas a call option is sold and a put option is purchased simultaneously (customer selects futures month, quantity, and strike prices). The net premium less a $0.03 per bushel service fee will be added or subtracted from the put strike price. This establishes a Minimum Hedge-to-Arrive Contract.
~ Basis and delivery time are set at a later date prior to delivery.
~ A service fee of $0.05 per bushel will be applied to establish and carry this type of contract with an open basis.
~ At the option expiration date if futures price is below the strike price of the put purchased, the minimum HTA price will be used along with basis to establish the flat price. If the futures price at expiration date is above the strike price of the call sold we will add the difference between the strike price of the call and the strike price of the put to the Minimum HTA price and use the appropriate basis to establish the flat price. If the futures price at the expiration date is between the two strike prices we will add the difference between the futures close at expiration and the strike price of the put to the Minimum HTA price and use the appropriate basis to establish the flat price.
~ All transactions must be conducted during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15 PM any weekday the CBOT is open for trade.
~ Minimum quantity for these contracts is 5,000 bushels.
** Would be used when customer is satisfied with the range of prices provided by the strike prices selected.
FLEX CONTRACTS
~ This contract must include one of the following: a). sale of a Basis Contract, b). sale of a Forward Price Contract, c). sale of a Hedge-to Arrive Contract. There is a 2 cent fee for initial transactions that include the addition of one option contracts. There is a 3 cent fee for transactions that include the addition of two option contracts. The 2-3 cent fees allow the customer to buy or sell an equal quantity of Call Options or Put Options to apply against the Flex Contract.
~ Customer must establish quantity, delivery month, basis, and location for Basis Contracts and Forward Price Contracts.
~ If this contract includes a Hedge-To-Arrive contract a $0.05 per bushel service fee will be deducted from the value of the basis once delivery month and location are established.
~ Following the initial transaction, the customer can do any of the following without incurring additional fees: a). buy back futures to unpriced a Forward Contract, b). Reverse Call Options or Put options traded against a Basis Contract, Forward Price Contract or Hedge-To-Arrive Contract.
~ If any of these transactions are done, basis must be set and delivery time and location cannot be altered. Any credit or debit from the futures or options will be used to adjust the basis value.
~ Following the completion of these transactions the customer can establish additional futures or option positions using the same contract choices as before. The service fee to establish these additional positions will be $0.02 per bushel.
~ Options or futures positions can be initiated or closed out as many times as the customer chooses prior to expiration date of the option or first notice day of the futures contract. As each futures position or option is liquidated, a credit or debit will be made to the existing basis value of the contract.
~ All transactions must be conducted during Globex trading hours from the beginning of CGC business hours until the close of the trading session at 2:15 PM any weekday the CBOT is open for trading.
~ Minimum quantity for these contracts is 5,000 bushels.
** This contract can be used to allow customers to utilize movements in futures and option values to establish better flat price sales.