Contract delivery date delivery and payment.

[kamichel]

Delivered an october yellow pea contract to a company early and sent my mom to pick up the check and was floored that they gave my mom a post dated check, I cannot have the money for another month. I don't think this is industry standard policy is it? What are others experiences?

[mustardman]

Delivered Sept peas to Pool and Paterson Aug 9 -cheque dated same day

[charliep]

Not industry policy. Wouldn't ship anymore loads there until the cheque for sales to date have cleared.

[parsley]

Make sure that you have not agreed to, in your contract, in other words, there is not a clause in your contract, that provides, that in spite of early delivery, that no-payment is in effect until the agreed-upon delivery date.


Some companies need supply at certain times, not four months early.

Parsley

[charliep]

Agree with Parsley on the contract part. Normally this would be highlighted at the time you sign the contract.

Lots of information not here including your long term relationship with the buyer (first time business or a long term relationship). My warning light is you are now an unsecured creditor with all the risk associated with that.

Will note the WBGA project - Cash Clearing House - will take most of the risk out of a transaction like this.

[kamichel]

Ok Mustard Man delivers to the SWP and gets paid same day, That is just the information that I needed. Since my deal is through the SWP or should say Vitara I now have good argument when I talk to the my rep. there. I am sure they will change that policy just like I got the 2 percent additional split policy changed. I have no fear of not getting paid. Just thought it was just wrong. I am sure its just some communication problem in the one elevator. I will talk to them on Monday.

[parsley]

charliep,

The WBGA Clearing project looks like it would be excellent for organics, as well.

kamichel,

Talking to the local agent is positive. And being informed about what the contract actually states is your moast effective negotiation tool.

Parsley

[kamichel]

Guess I am bad for not reading contracts.
But in this case the contract does not state what is policy for payment when the contract is delivered 1 month early.

[parsley]

The next time you sign the contract,make an addition.

Early delivery by the grower will be reciprocated with early payment by the buyer.

Discuss.

No problem next time.

Parsley

[parsley]

PS

And both buyer and seller initial the addition.

[TOM4CWB]

kamichel,

I assume this was not a production contract but a flat price on a specified tonnage.

Earlier delivery has always meant a lower price this has been my experience Viterra.

Even on Pea contracts they normally create a basis... and earlier fall delivery almost always means a lower price.

I just flipped a Canola contract from October delivery to September, It costed me the basis difference $3/t on this Canola. I considered this a reasonable price to pay, and I do get my cheque almost a month earlier. Now I can refill my best hopper air storage with Canola again.

What is reasonable?

Delivery off the Combine is worth big bucks for one less handle, less splits, freed up good storage.

IMHO, I think it is fair for you to need to wait till October to cash the cheque.

[kamichel]

True Tom delivery off the combine for you is worth something as it is for everyone.
But that was a deal made between you and the company you dealt with, the buyer offered it to you and you took it. If on the otherhand a company goes ahead with an earlier delivery date and I am able to deliver and no talk of price change then I believe the contract price should be paid on delivery just as it would have been paid if delivered in the contract month.

[kamichel]

As mustardman and others most of us had verbal talk with the buyers that they may take the peas earlier just that Sept. and Oct. delivery were on the contracts to make delivery time safer for the buyer and the grower to meet.

[kamichel]

At the moment I have been put in my place.
SWP local elevator say that I cannot have my check on delivery and that the other SWP elevators will be called to stop paying the farmers on delivery.
I cannot believe it.

[kamichel]

Their Loss