Pre-Harvest Program

Market Check’s innovative Pre-Harvest Program is an avenue for growers to execute part of the pre-harvest strategies we advocate and utilises put options to protect new crop prices without the risks associated with a forward sale (swaps or forward contracts). The Pre-Harvest Program is like an insurance policy against falling prices, growers pay a ‘premium’ (put options cost) to protect downside risk for new crop wheat and barley prices but also participate if the market rises with no ‘washout cost’ associated if the crop fails.

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Australia's export program is running at an incredible pace. One way to illustrate this is from Jan 2021 to Feb 2022, on average, 126kt of grain has left our shores...everyday of the week (5kt/hour🤠). Jan-19 to Feb-20 was only ~35% of the current pace. #oatt

About a month ago from Market Check's Twitter via Twitter Web App

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Put Options to protect new crop prices

Utilising put options pre-harvest is not only less riskier but on average outperforms forward selling

"Put options have been an effective way of protecting prices whilst avoiding washout risks. This means we can actively manage a larger percent of our new crop production price risk further out using the Pre Harvest Program."
John Bennett, Farmer from Lawloit, VIC