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