Trading Up

 

By Rebecca Lentz

 

From the Spring issue of C Magazine by CHS

Trade hasn’t always topped the list of farmer concerns. But today, the impact of trade policies ranks as one of the most important factors for farmers determining how to approach business —in the field and in the boardroom.

“That’s how interconnected everything is. Trade and trade policy become much more important when U.S. grain is competing with global supplies of corn, soybeans and wheat,” says Chris Stringer, senior merchandiser, CHS Global Grain Marketing. “Every day, market changes are being influenced by policy.”

Capitalizing on that opportunity isn’t as simple as deciding to export commodities. Companies must understand customer needs and have the resources to deliver the right products in the right amounts at the right time, says Bryce Banfield, vice president, CHS Global Grain Marketing.

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Emerging markets often don’t have sufficient economies of scale compared with large-scale buyers. Generally in those markets, multiple smaller buyers are the norm and they don’t have capacity to accept large-vessel shipments. CHS specializes in getting smaller container shipments to emerging customers, allowing them to grow their businesses without having to buy more product than they need.

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That understanding gives CHS a market advantage and comes from placing people in importing countries to meet with customers on behalf of its farmer-owners. More than 60 people are working for CHS in the Asia Pacific region in Japan, Singapore, South Korea, Taiwan, China and other countries.

“It’s imperative to have people there,” Banfield says. “We’re not a paper-trading company. Having a physical connection gives us reputability in the market. When customers see how big CHS is and that it is owned by producers, they are impressed.”

For more content like this visit C Mag.

 

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