ADM sharpens payment terms for producers
In recent times, a number of farmer groups have called for the grain industry to provide greater payment protection to grain producers who store and market their grain on-farm. Traditionally, these markets have operated on 30-day payment terms, which at certain times can either be cash flow restrictive, or, amongst other things, limit the seller’s visibility to an impending (and unsuspecting) payment or buyer default.
In a move to provide grain producers with greater certainty and payment security, ADM is pleased to announce it will revise its payment terms from 30 days end week of delivery (30DEOW) to 14DEOW. The narrowing of payment terms will apply to cereals, oilseeds and pulses purchased on an ex-farm or delivered basis nationwide.
“ADM believes that making this step will support growers who wish to take control of their grain marketing decisions via the increasing on-farm storage network around Australia,” said Damian Bradford, Group Manager Accumulation with ADM.
“We acknowledge that our revised payment terms are not as short as those offered by companies via the bulk handlers, however, considering the timing gap in capturing delivery information, shortening the terms by more than two weeks is a big step in the right direction.”
“Now, more than ever, there is a greater onus on the seller and/or freight providers to pass on weighbridge ticket information to ADM in a timely fashion, so not to jeopardise an on-time payment.”
In addition, grain producers who deliver to ADM via the bulk handling system (Grainflow, CBH, Graincorp, Viterra and independent stores) on contract or cash at silo will now receive payment within 7DEOW.
ADM’s new payment terms will not be regionalised and will apply nationally to ensure all grain producers equally share the same benefit.
The new payment terms will apply to contracts confirmed from Thursday, August 15, 2019.
For further information on ADM’s new payment terms, marketing offering or price communication options, please contact your nearest Grain Accumulation Manager.