Price now and stay in the market to express your bias.

What is the Focal Point contract?

  • Focal Point is an add-on to an existing Cargill grain contract that lets you stay in the market on grain you have already priced.
  • Focal Point allows you to take a new position in the market up to three times.
  • Gains or losses from a Focal Point contract are added to your contract’s final settlement.
  • The market cost to enter a Focal Point contract is called the Focal Point Factor.

Why should I use Focal Point?

  • If you understand your market bias and are looking for a hands-on approach to grain marketing.
  • You should consider opening a Focal Point contract when you feel there is upside potential in the market.
  • As your trusted partner, we’ll help you manage downside risk by establishing a trailing stop.

What else do I need to know about Focal Point?

  • When you enter into a Focal Point contract, your grain settlement will be split into two payments. The reason for the split is the downside risk of creating a new position in the market.
  • Once you have delivered your grain, you will receive a payment for 70% of the deferred delivery contract value; the balance and adjustment will be paid once the Focal Point position has been exited and all grain has been delivered. A Focal Point position may extend past grain delivery, which will delay the second payment until the position has been closed. 
  • You do not have an absolute price floor with a Focal Point contract; this means you’re taking on price risk if the market goes down. 
  • You can track Focal Point on CargillAg.ca

 

If you’re interested in learning more about a Focal Point Grain Marketing Contract download an info sheet here or contact your Cargill Representative.