by David Start, Chair, OCPA Grain Trade and Marketing Committee
Electronic commerce
– the buying and selling of goods and services using the Internet –
has had a bumpy ride since its introduction into the marketplace. Stock values
of Internet-related companies and service providers soared to astronomical heights
by the late 1990s. But when the early promise of electronic marketing did not
quickly materialize, and it became apparent that profits and sales were still
far below levels needed for financial sustainability, stocks plummeted. For example,
Nortel’s stock price fell from $124 per share to $0.68 per share. But despite
the fact that instant profitability is no more guaranteed in this than in any
other commercial venture, electronic commerce really does offer new opportunities
for directly connecting buyers and sellers. Even for grain corn.
OCPA has been working closely with Casco to develop new opportunities for Ontario
grain corn producers. Casco Inc./Canada Starch Operating Company Inc., founded
in 1858, was the first corn refining operation in Canada. Casco is by far the
largest industrial user of corn in Canada, producing sweeteners, starch, corn
oil, gluten feed and meal. Operating three corn wet milling plants in Cardinal,
Port Colborne and London, Casco grinds millions of bushels annually – equivalent
to approximately 28% of an average Ontario corn crop. Headquartered in Etobicoke,
Ontario, Casco is a wholly owned subsidiary of Corn Products International, Inc.,
headquartered in Bedford Park, Illinois (just south of Chicago).
The “Sell Your Corn on the Web” project is designed to increase the
volume of corn purchased by Casco directly from Ontario corn producers by using
the Internet to make contracting quick and convenient. Moreover, by using the
Internet to communicate price and delivery opportunities well into the future,
Casco can provide almost instantaneous updating of price and basis offers, as
well as tonnage requirements. This ‘live time’ feature allows growers
the opportunity to view the Chicago and basis prices currently being offered.
If they decide to sell at that moment, they will know exactly what they will receive
for their corn on delivery. All without ever needing to reach anyone directly
by telephone.
Casco has completely revamped their website to include the “Sell Your Corn”
application. Once on Casco’s website, enter your Agri-eBusiness number to
gain producer access to “Sell Your Corn”.
Selecting one of the three delivery sites brings up a page for that site which
will list basis and flat price offers by month/delivery period for the next 10-12
months. Wet corn price and delivery offers are also listed for relevant months.
You can view the information in either bushels or metric measure, whichever you
prefer. By clicking on the desired price and delivery period, you will be given
the choice of a basis, basis wet, fixed price, or fixed price wet contract. Selecting
one then brings up the actual electronic contract submission with your choices
already entered. Then you simply enter the quantity you wish to contract. Minimum
delivery quantities are truckload lots, with Grade #2 Canadian Eastern Yellow
Corn providing the default standard.
Once you have checked to ensure all information is correct, you will be asked
whether you have an outstanding Cash Advance and/or ACC loan remittance requirement.
You will also be asked to grant permission for an electronic lien search of balance
outstanding, against cash advance and/or ACC loans.
Such lien searches have always been required by regulation on all payments against
corn sales. Electronic contracting permits the required lien search to be done
electronically and provides current balance outstanding which is designed to eliminate
the present situation, where over-deductions and subsequent rebates to producers
are the norm. If all details of the contract submission are correct and acceptable
to you, click on the ‘submit’ button to send the contract to Casco for
acceptance. Casco will review the contract and confirm acceptance either by e-mail
or fax as requested by the producer.
As delivery period approaches, Casco sends a delivery reminder. The electronic
contract copy is sufficient for delivery manifest.
Additionally, the website offers you the opportunity to review the status of all
your contracts whether currently open and/or closed, by delivery ticket and/or
by time period. All information can be downloaded and/or printed by the producer.
It is important to note that only you will have access to this information. This
feature will allow you to obtain quick detailed summaries for financial management
and tax filing purposes. You can also choose a sales summary that fits your own
individual tax-year filing period. Summaries can also be downloaded and/or printed
for all deductions, payments, grades, etc.
A six-month pilot project to test the website and electronic contracting will
be initiated in January 2003 at the Casco London plant. Casco’s “Sell
Your Corn” electronic contracting will be extended to the Cardinal and Port
Colborne plants once the pilot project is successfully completed.
OCPA has been pleased to work with Casco on this project that is designed to provide
Ontario corn growers with enhanced marketing options as well as direct access
to more accurate, more timely market information. We will continue to provide
readers with regular updates through the Ontario Corn Producer.
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