September 12, 2008
21 Nations at Northern Crops Institute's Grain Procurement Management Course
Fargo, N.D., USA – “The cost and availability of grain is heavy on the minds of our short course participants,” says John Crabtree, NCI Assistant Director. Thirty-six grain buyers are attending the 2008 Grain Procurement Management for Importers short course at Northern Crops Institute (NCI), Fargo, N.D., to learn how to make more effective purchases in the U.S. grain marketing system.
The course runs from September 8-17.
Grain buyers attending the course are from Albania, China, Colombia, Cyprus, Denmark, Indonesia, Japan, Jordan, Madagascar, Mexico, Netherlands, Nigeria, Oman, Philippines, Poland, Romania, Saint Vincent, Syria, United Kingdom, USA, and Venezuela. They represent large and small food processing, feed manufacturing, and trading companies that import HRS wheat, durum wheat, corn, soybeans, barley and other commodities.
Several participants are sponsored by U.S. Wheat Associates and the USDA Foreign Agriculture Service Cochran Fellowship Program.
“Right now, the world is consuming more wheat than is being produced,” says Crabtree. “In the long term, that can’t continue because it may cause prices to rise to unpredictable levels. The bio-fuel industry throughout the world is using the crops, too. That’s a big concern for overseas processors, and it adversely affects consumers.”
“There is so much volatility in the market,” Crabtree continues. “In this course, we are providing the course participants with tools, such as hedging, to reduce their risk when they are purchasing grain. We’re also talking about inventory control. Many companies have operated on the ‘just in time’ theory. At the present time, that may not be a very good idea. Processors need adequate stocks because of the uncertainty in the markets,” Crabtree concludes.
During the first week of the course, the group tours the Hunter (N.D.) Grain Company elevator with Paul Skarnagel and visits the Jim Howe farm near Casselton, N.D.
“We are excited to have these grain buyers see our region and farm crops first-hand,” says Brian Sorenson, NCI Director. “Our spring wheat harvest in the four-state region has gone quite well. About 90% of the HRS and durum crop have been harvested, and we are quite excited about the quality of these crops. Preparation of the regional crop quality survey is underway, and that information should be available by mid to late October. The information will be showcased at US Wheat Associates Crop Quality Seminars throughout the world, so millers and processors get the first glimpse of the new crop’s quality,” Sorenson concludes.
The course participants also travel to Duluth, Minn., where they will tour the Duluth Seaway Port Authority with Executive Director Adolph Ojard, and the CHS Export Grain Terminal with Superintendent Dick Carlson.
Trading games both at NCI and at the Minneapolis Grain Exchange (MGE) are a special feature of this course. At the MGE, Helen Pound of Goldenberg, Hehmeyer & Co., will lead the participants in a mock trading exercise on the Exchange floor and explain the fine points of grain trading. Ray Erickson will lead a tour of the Minneapolis Grain Exchange.
During the tour of CHS, Inc. Barge Facility at Savage, Minn., Superintendent Greg Oberle will explain the grain transport system on the Mississippi River.
Speakers for the course are: Dr. William Wilson, NDSU; Art Boline, GIPSA/USDA; Darcy Rasmussen, N.D. Grain Inspection Service; Ray Grabanski, Progressive Ag; Dr. David Bullock, FC Stone; Dr. John Oades, U.S. Wheat Associates; Holly Womack, CoBank; Erica Peterson, N.D. Wheat Commission; Mike Krueger, The Money Farm; Sean Hower, BNSF Railway Co.; Ron DeJongh, Columbia Grain; Rick Dusek, CHS; Mike Klein, CHS; and Julie Heinz and Mike Klein, CHS; and Kerry Melius, ADM-Benson Quinn.
The course’s study topics include U.S. grain handling and transportation system, cash and futures markets, basis, U.S. grain grading standards, basic hedging principles, options, commodity analysis, price risk management, quality specifications, alternative sources, financing imports, grain situation and outlook, railroads, logistics management, contracts and arbitration, managing ocean freight risk, exporter tendering strategies, and buyer/seller relations.