FORWARD CONTRACTS

As is the case with all agricultural commodities the vagaries of price volatility are and continue to be of considerable concern to producers.

 

Beecher Wool Services can offer you the ability to manage this risk via use of:

 

Wool Forward Basis Contracts

Your wool is sold at auction with the Forward Basis Contract settled against a nominated Micron Price Guide (18.5-23 or 28, 30 MPG). The difference between the contracted MPG price and the MPG on the contracted sale day being the settlement amount to be paid or received.

 

Wool Basis Options

You pay a premium up front to lock in a micron price guide price (floor price). Your wool is sold at auction with the Wool Basis Option Contract only settling if the contracted MPG price is greater than the MPG on the contracted sale day. If it is you will receive a settlement payment.

 

Physical Forward Contracts

Are contracts which require the physical delivery of fully specified wool to meet mills requirements. The contract is subject to both premiums and discounts dependent upon such things as micron, length, strength, vegetable matter, etc. These contracts are more difficult to meet particularly if your wool clip varies significantly from the contracted specification.

 

As an independent operation Beecher Wool Services can negotiate forward contracts for your clip, using our contacts with most mills and exporters.

 

Your clip is fully tested in our stores and remains there until buyer payment is received.

 

You deal with Beecher Wool Services knowing that you will receive a thorough and objective summation of the contract.