Over recent years’ price discovery tools have significantly grown in popularity due mainly to the amount of buyers any particular grower needs to be keeping track of their prices in order to capture the best price available on any given day for their grains specific quality and location. The role of Price Discovery tools in the grain market is therefore primarily to collate all the buyers daily published prices and deliver them in an easy to digest format for farmers.
When using these tools, it is important to understand the difference between 'indicative' v's 'firm', as well as 'cash' (or 'cash at silo') and 'contract' prices. An 'indicative' bid is a price indication the buyer has set at a point in the day, but can only be used as an indication as it may well have changed by the time you call them. A 'firm' bid is a buyers’ price that is 100% live and available for you to accept right away with no adjustments. A 'cash' price is when buyers post a firm bid that growers can accept upon delivery then and there on the weighbridge (and is now also available for GrainCorp warehoused grain via their GrainTransact website). A 'contract' price are the indicative prices buyers publish every day and can be accepted by calling that buyer directly or via some of their websites if they have online contracting capabilities.
Profarmer Discovery is the only national price discovery service in Australia. Profarmer Australia has been collecting grain prices for about 20 years but the current price discovery website and app was launched in 2011.
The product includes prices at nearly all bulk handers across Australia, as well as all major delivered region prices, across nearly all the types and grades of grain produced in Australia. The prices are made up of three types being the buyers indicative contract prices, firm cash prices and firm bid and trade prices from the Clear Grain Exchange. The product includes both the current and forward season prices.
The prices are updated throughout the day however as the collection process is not yet automated with the buyers’ systems (with the exception of the Clear Grain Exchange which is a live feed of firm prices), there can be some buyers price changes during the day that are either slow to be updated or missed all together on Profarmer. This is off course the nature of 'indicative' pricing!
DailyGrain is wholly owned by CBH and hence is only available to WA growers at CBH sites. Dailygrain provides a great free tool for WA price discovery which is comprehensive and buyers seem to update their indicative prices regularly throughout the day. If you are looking for extra features, the Premium package is relatively cheap for the extra services that are included in the package.
DailyGrain also has the ability to accept firm bids, however there is only a small amount of buyers who opt to post firm bids as opposed to posting indicative bids that can not be accepted via the service. The platform clearly distinguishes which bids can be accepted via Dailygrain and which can't. There is also an integration with live firm bid and trade prices from the Clear Grain Exchange which can be accessed via a simple web link.
GrainMarket was created by MarketAg (Grain Consultants) for WA growers as a means to better service their customers with price discovery and contract management. The price discovery component of the product is similar to that of other providers and just includes indicative WA prices from all the major buyers. As it is closely linked to MarketAg, it is believed that there are often prices included that are not being published by buyers but are what they are willing to pay on that day, so can potentially provide a more accurate pricing service than the other providers who are not also grain consultants.
The aspect which is the standout feature of GrainMarket is the grain marketing plan and contract management component that is part of the silver service subscription package. This is an industry leading service (and not just out of the WA products) which from all accounts seems to justify the price tag if you are looking for a solution in this area.
The GrainCorp app is for any grower who is warehousing grain with GrainCorp and provides site information, grain delivered information as well as cash prices. The site information includes things like opening hours, grades being accepted and site contact details. You are able to log into the app using your GrainTransact details to view your load delivery information which is incredibly handle on the go over harvest. The pricing component includes the firm cash bids being published, however these bid prices can't currently be accepted via the app (only via Grain Transact).
Although this app isn't the most sophisticated in it's usability, it is industry leading out of the Australian bulk handers for the service it provides.
There are a number of other online products and apps that can also be used for price discovery. A large number of these however only include one buyers prices (e.g. Glencore have a pricing app with just their prices included) and therefore have not been included for the purposes of this blog which is looking at the leading tools that are collating a range of buyers prices into one product.
If you are marketing any grain on the East Coast and SA, Profarmer Discovery is a must have product for you. It covers all the pricing information you will ever need and is relatively cheap compared to similar products.
If you're delivering grain to GrainCorp, their app is also a must have for the site receival and your delivery information. I would recommend however still using Profarmer Price Discovery for price information as it includes all the GrainCorp cash prices plus all the contract prices which are critical pricing information when marketing your grain.
If you're a WA grower and are just interested in price discovery, then DailyGrain is the best fit due to it's price discovery free components being equal to that of other providers. If you would like slightly more functionality such as contract management and direct access to your Loadnet grain, then the DailyGrain premium package is a relatively cheap upgrade. If however, you are looking for a sophisticated marketing plan and contract management tool, I believe the GrainMarket silver service will justify the price tag.