Facing a difficult trade environment, given the status of the economy, the importance of contracting and risk management is increasingly critical for sellers of U.S. distiller’s dried grains with solubles (DDGS) and coarse grains, according to Sam Bonilla, senior advisor for the North American Export Grain Association (NAEGA).

Scheduled to speak at the Export Exchange 2010, an international conference focused around the export of U.S. DDGS and coarse grains, to be held Oct. 6-8, 2010, in Chicago, Bonilla plans to provide attendees an overview of the NAEGA No. 2 Free on Board (FOB) contract and explain the risk management features associated with it.

“A good understanding of the contract details is critical in preserving expected margins but, more importantly, in executing the trade, maintaining a very satisfied customer is paramount to the success of your business,� Bonilla said.

Bonilla will also discuss the role a contract can play in minimizing risks and increasing the trade of U.S. commodities.

“A contract can help by providing very clear and concise terms that both parties are familiar with and fully understand,� Bonilla said. “As most traders become involved in string transactions with differing terms, understanding the implications of deadlines and obligations between a FOB contract and a Cost, Insurance and Freight (CIF) trade is critical in effectively executing the business.�

Prior to holding his position as senior advisor for NAEGA, Bonilla served as assistant vice president of export administration at the Continental Grain Company from 1968-1999 and then for Cargill Inc. as a forwarding manager from 1999-2009.