Throughout history, grain plants have been important sources of food. The ancient Greeks and Egyptians, for example, raised wheat and barley as food crops. In the Orient, the Chinese pioneered the use of rice in a similar fashion. The Aztecs and other American Indians raised corn very successfully. In their purchasing careers, grain merchants have played a vital role in the trading process. They buy the raw grain from the growers and then distribute it to markets all over the world. By purchasing, processing, transporting, and storing grain merchants facilitate the smooth flow of the commodity all year round, both during times of shortages and surpluses.
With its buyer jobs, grain merchants purchase grain when the stock on hand reaches a predetermined reorder point, when a person or organization specially orders it, or when market conditions are especially favorable. To purchase grain, the grain merchant must consider the type of grain, quantity discounts, freight handling or other transportation costs, and delivery time. Much of this information can be obtained by comparing listings in catalog and trade journals, interviewing supplier’s representatives, keeping up with current market trends, and examining sample goods. Many merchants now also use computers to obtain up-to-date price listings, to keep track of inventory levels, and to process routine orders.
Grain merchants must be sufficiently familiar with the various qualities of grain to determine whether certain grains should be purchased. Merchants inspect samples of grain by weighing it, checking it moisture content, and examining it for the presence of insects or other signs of damage. Grain might also be classified according to type.
Moreover, the U.S. government has developed grain standards and in this way ensures that grains of a certain grade all meet the same specifications. After the grain merchants make an initial appraisal of the quality of the grain, they send samples to a federal grain inspector for an official appraisal.
It is important that grain merchants develop a good working relationship with farmers and other suppliers in order to attain a good price on the grain, favorable payment terms, quick delivery on emergency orders, or help in obtaining the grain during times of scarcity. To negotiate these and other conditions, grain merchants must have good communications skills, be able to work effectively with others, and take high-pressure situations in stride.
Although grain merchants’ planner jobs often involved with many aspects of the buying, storing, and reselling process, there are a variety of specialists which include grain buyers who evaluate and purchase grain for resale and milling. They select the type of grain to order based on current demand and possible future considerations. Grain buyers arrange for the transportation and storage of the grain and also identify possible resale markets. They hope to make money by reselling the grain at a higher price than they purchased it. To minimize their risk, buyers may purchase the grain at a higher price than they purchased it. To minimize their risk, buyers may purchase commodity futures, which are agreements to buy or sell an amount of their crop at a future date. These futures are hedges against a change in the price of grain or other commodity.
Moreover, grain buyers who manage grain elevators must inspect all grain that comes to these holding terminals and calculate its market value. In estimating its market value, they must not only take into account the purchase price of the grain, but also transportation, handling, and other charges. Grain elevator managers keep daily records on the kinds and grades of grain received, prices paid, amount purchased, and the amount in storage. They also are in charge of supervising grain elevator workers in the loading, unloading, mixing, and storing of the grain for shipment and milling. Nevertheless, grain broker-and-market operators buy and sell grain and future contracts for investors through the commodity exchanges. They advise their customers on factors that may influence the price of grain, such as grain production and consumption.
Likewise, to further professional opportunities in their purchasing careers, many grain merchants get an undergraduate or graduate degree in agriculture, economics, or finance. Course work should include agricultural economics, accounting, purchasing, finance, and business law. A grain merchant should have a calm temperament and be able to make decisions regarding large sums of money. He or she should also possess an initiative and a good judgment in dealing with various business transactions in order to succeed.
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