Wheat Contracts

Wheat is bought and sold on the basis of a contract. There are standard forms of contract established by organisations such as the Agricultural Industries Confederation (AIC) and the Grain and Feed Trade Association (GAFTA) on behalf of grain traders, although many businesses use their own terms.  Sales and purchases may be made in various ways: “spot” for immediate delivery or forward; growing contracts may be offered for a limited tonnage of specific varieties; pricing may be fixed at the time a contract is agreed, or may be linked to the futures market or some other benchmark.  Premiums may be offered for specific qualities.

Pre contract advice to farmers is provided through the HGCA’s sellers’ checklist.