Introducing the FBN℠ FOB Farm Basis Offer. We leverage the power of our network to find top buyers, aggregate bushels, and negotiate on your behalf to get you better Basis levels.
How Do FOB Farm Basis Offer contracts work?
- You set an FOB Farm Basis Offer with FBN by giving us a call and telling us the Basis level you want.
- FBN aggregates member grain, and sources buying opportunities.
- If we can find a deal and accept your Basis offer, we will pick up your grain right from your farm.
- You can accept the spot Futures or defer your Futures to a later month while still receiving cash up front.
How Can FBN Find Better Basis Offers?
- We make your grain available to more buyers: we actively hunt for deals across a range of buyers for your committed bushels – saving you effort and expanding your reach.
- We leverage the power of the FBN network: by combining your grain offer with other FBN member grain offers FBN uses market power to negotiate better Basis levels.
Why Use an FOB Farm Basis Offer contract?
- Get a Better Basis: We'll work to find you better Basis offers than what you'd be able to find on your own.
- Save time and money with on Farm Pickup: Capture your target Basis levels without having to haul grain long distances, or wait in elevator lines - FBN will pick up grain on your farm.
- Maintain futures flexibility: Choose from a range of futures price options - lock in the spot price, roll to another futures contract, and purchase protection against your futures price.
- Cash flow up front: If you roll your futures contract, you will still receive 70% of your Initial Cash Price upon delivery*.
Real example of FBN helping an Indiana member through an FOB Farm Basis Offer
The farmer had grain in the bin that he was going to sell. One option was to deliver to his local co-op 5 miles away, and accept the spot cash price, at a -$.24 basis/bu. His transport costs would be $.05/bu, meaning that his basis including transport would be -$.29/bu.
Instead of delivering, he provided FBN with an FOB Farm Basis Offer of -$.19/bu - which was a $.10/bu improvement upon his -$.29/bu local basis. FBN was able to find this offer at an end buyer 69 miles away - earning the farmer an extra $.10/bu. On a total of 5,000 bushels, this earned the farmer an extra $500!
This farmer elected to take the spot futures price - but if he elected to, he could have deferred his futures to take advantage of any potential rallies in the market.
Let Us Know:
© 2017 FBN CM LLC. FBN Crop Marketing is offered by FBN CM LLC and is only available where FBN CM LLC is licensed. Contact (844) 200-FARM for more information. We do not guarantee customers will receive specific benefits or value from participating in FBN Crop Marketing; results will vary.