Delayed Price Contract or Price Later Contract

Purpose:

To deliver grain without establishing a price until a later date.

When To Use:

1. When you need to move grain and the flat price or basis is not acceptable.
2. When DP charges are less than storage.

Advantages:

1. Allows you to move grain when you need to.
2. May be cheaper than storage or sometimes free.
3. Maintains opportunity for basis and price improvement.
4. May be rolled forward, but usually with a charge for additional time.
5. Can be rolled into a basis or GMP contract.

Disadvantages:

1. Not always available.
2. No downside protection.
3. If service charge is low or free, this may be a sign of a poor marketing alternative.

Execution:

1. Establish a delivery period and service charge.
2. Sign and return the State of Illinois required contract within 30 days after the last delivery day. If this is not done, the grain must be priced.
3. KY Producers must sign and return Delayed Pricing Contracts within 30 days of first delivery day.
4. Price or roll forward grain before contract expiration date.