Processors of agricultural items typically agree upon Commodity Contracts with their growers before the start of every harvest. Under the terms of a commodity contract, the grower and processor settle upon a quantity of product that the grower will harvest and sell to the processors over the course of the season, as well as a base price that the processor will pay for this item. Over the course of the harvest, as the processor receives product from the grower, the purchased quantity is maintained alongside the contract quantity, making it possible to determine how far along the grower has come in supplying the agreed-upon quantity.
Aptean Food & Beverage ERP bcFood Edition makes it easy to set up these agreements within Dynamics, then manage them throughout the growing season.
Commodity Contracts
Maintain the business relationships between you and your growers with Aptean Food & Beverage ERP’s commodity contract functionality. Using commodity contracts, you will always have a clear picture of the expected and actual inbound quantity of commodities, as well as the pricing that has been established for these products.
Seasonal contracts – assign start and end dates to contracts to represent specific time periods, such as annual growing seasons, making it easy to close out and archive contracts once a given season has come to an end.
Variety-level setup – identify specific varieties or strains of contracted crops or other commodities, along with alternative variants that are also permitted under the terms of the agreement.
Linkage to commodity receipts – generate commodity receipts directly from contracts, update contract quantities with recorded receiving activity, and enforce business processes by preventing the receipt of commodities without a valid contract.
Usage scenario
Prior to growing season, set up the commodity contracts you have agreed upon with your growers and ranches, then monitor purchased versus contracted quantities throughout the course of the season.
Before the new harvest season gets underway, our customers in the agricultural sector will set up commodity contracts for all their purchasing agreements, then use them to monitor progress as the season goes along.”
Bruno Johansson, Beck Consulting.