Table of Contents

Table of Contents
 
Chapter 1:  U.S. Grains - Commodity Description  
Corn......................................................................................................................1
Sorghum...............................................................................................................4  
Barley…………………………...........................................................................6  
 
Chapter 2:  Industrial Uses for Grains
 Current Industrial Uses........................................................................................8
 The Wet Milling Process.....................................................................................9
 The Wonder of Starch…......................................................................................11
 New Avenues of Research for Industrial Uses....................................................11
 New Product Examples........................................................................................12
 Licensing..............................................................................................................14
 
Chapter 3:  How to Procure U.S. Grains
Finding a U.S. Grains (or Co-products) Supplier................................................24
Purchasing U.S. Grains (or Co-products)............................................................26
Standard Contract Terms.....................................................................................31
NAEGA 2.............................................................................................................32
GAFTA 27 and 30...............................................................................................35
Basic Documents Employed by the Grains Trade...............................................37  
 
Chapter 4:  Grain Quality and U.S. Standards
 U.S. Grain Standards Act.....................................................................................43
 Official Weighing Procedures..............................................................................45
 Official Inspection Procedures.............................................................................47
 Inspection Equipment..........................................................................................49
 Official U.S. Standards: Barley...........................................................................51
 Official U.S. Standards: Corn…..........................................................................53
 Official U.S. Standards: Sorghum.......................................................................55
 Fumigation and Grain Protectants.......................................................................58
 Phytosanitary Certificate......................................................................................58
 Complaints...........................................................................................................59
 
Chapter 5:  U.S. Export Facilities and Ocean Transportation
 Mississippi River/Center Gulf.............................................................................62
 Texas or West Gulf..............................................................................................63
U.S. Atlantic Coast..............................................................................................64
Pacific Northwest.................................................................................................64
Great Lakes..........................................................................................................65
Freight Options for the Overseas Buyer..............................................................66
Chartering a Vessel..............................................................................................68
Standard Charter Parties......................................................................................69
Role of the Agent.................................................................................................74
Ship Types...........................................................................................................76
 
Chapter 6:  Risk Management in U.S. Grains Markets
Exchange Traded Futures....................................................................................80
Exchange Traded Options....................................................................................81
Over the Counter Swaps......................................................................................83
Derivatives...........................................................................................................85
Trade Options......................................................................................................85
Trade Partners......................................................................................................86
Hedging and Basis Trading..................................................................................87
Summary of Hedging and Basis Trading.............................................................97
Market Analysis...................................................................................................100
User's Guide to Exchanges in the United States .................................................103
 
Chapter 7:  Financing U.S. Grains Imports
Letter of Credit.....................................................................................................112
Payment Against Documents...............................................................................114
Countertrade.........................................................................................................115
Other Payment Methods......................................................................................117
Finance Options and Methods.............................................................................118
GSM Financing ...................................................................................................119
Letter of Credit Financing....................................................................................123
 
Appendix
A. NAEGA FOB Contract No. 2
B. NAEGA Loading Rate Guaranty Addendum No. 1
C. GIPSA U.S. Standards for Barley
D. GIPSA U.S. Standards for Corn
E. GIPSA U.S. Standards for Sorghum
 
Glossary
 
This manual was revised August 2004.