A GRAINS industry veteran believes Aussie farmers are losing out by not participating more actively in industry derivatives markets and using forward marketing tools such as swaps and options.
The marketing focus in recent years, especially for east coast growers with access to healthy domestic markets, is increasingly on selling physical grain post-harvest, with farmers often happy with premiums that can be generated on harvest prices.
However, Malcolm Bartholomaeus, Bartholomaeus Consulting, said the data showed that forward selling crops through derivatives often provided the best opportunities for the year.
"This year is a prime example, the prices were well up in March due to the collapse in the Australian dollar and if you were able to take advantage of that you can generate yourself some very good premiums," Mr Bartholomaeus said.
"I am not sure that Australian growers are really up to speed regarding how to best use these type of forward marketing products, they know about influences on price like basis and currency but they may not be aware of how to take the opportunities they present."
"The various products out there are being under used."
"Growers can take advantage when the exchange rate, the futures price or basis levels are favourable and it can really bolster their returns but it is not happening as often as you would expect.
"There are opportunities in post-harvest marketing, but you also have the cost of carry, warehousing fees if it is in the bulk system, plus storing grain does not automatically mean a premium on harvest values down the track, so you have to look at all the options including using forward marketing strategies."
"On-farm storage and the like is also limited as it is only really an option for those that can deliver to domestic markets."
Mr Bartholomaeus said fewer brokers and grain marketing services were offering derivatives due to increased red tape and cost following the financial services Royal Commission.
"Unfortunately there were a lot of products out there that helped farmers to forward market their crop but they are not out there any more."
He said he believed growers should be lobbying government to allow easier access to financial service products.
"These types of services can help, especially for farmers who don't feel they have the expertise to set them up themselves."
He said other products such as pools or online trading platforms also had a place in a diversified marketing strategy.