Technology has revolutionized and dramatically improved the way grain is traded worldwide in only a few decades. At the Barchart Grain Merchandising & Technology Conference, Barchart’s Andrew Ward reflected on his time spent as an Australian wheat merchant in the late 1990s, where he relied heavily on manual processes.
Ward would wait for markets to open in Chicago at 1:30 a.m. and used a fax machine to get weather updates and communicate with customers, placing all trades by phone call. These practices were common across the industry, but were slow and prone to human error, making grain merchandising both time-consuming and inefficient.
Ward said the introduction of electronic trading platforms in the 1990s was a turning point. Electronic trading was slow to gain traction, with only 100,000 contracts traded electronically per month on Globex in 1997, but it set the stage for a new era in grain trading. As trading systems matured and tools like CQG offered direct market access, grain merchants could place orders with greater speed and accuracy. Today, electronic trading completely dominates the industry. In August 2024, CME Group reported its average daily volume of electronically traded contracts at 31.7 million — an exponential increase from 1997 contract volumes.
Technology has also changed how merchants and farmers communicate with each other, shifting from fax and email to text messaging and now mobile apps. Today, grain merchants can receive offers from farmers directly through a smartphone. Much like electronic trading, mobile trading apps increase efficiency, save time and reduce the risk of errors. Ward said around 23% of Barchart’s grain offers now come digitally from farmers, and he expects the figure to grow.
Ward highlighted the ‘offer match’ feature on Barchart’s mobile app, where farmer bids and offers are matched electronically with market bids, integrating risk management strategies by instantly generating a hedge. Once an offer is submitted through the app and matched, automation handles everything from generating trade tickets through reconciling positions. This straight-through processing eliminates the need for separate steps in trade execution, offer matching, and hedging, and the need for merchants to manually intervene in transactions.
The introduction of customer relationship management (CRM) systems designed specifically for grain companies is the latest game changer in customer interaction efficiency. Centralized customer data enables grain merchants to better understand and serve their clients and can strengthen their relationships.
In most traditional workplaces, Ward said grain merchants keep track of customer data using personal notebooks or diaries. But a centralized CRM securely stores all critical information — from scale tickets to open contracts and delivery histories —and is easily accessible.
This not only helps track transactions but also builds a comprehensive profile of each customer’s preferences, purchase history and frequency of interaction. By tracking these interactions, whether phone calls, text messages, emails, or in-person, merchandisers can address customer needs promptly and anticipate future interactions.
Another advantage of a CRM is the ability to mitigate the risk of losing client data when a merchant leaves the company. If they used personal or inconsistent customer data recording methods and then depart, much of their client knowledge goes with them. A CRM system ensures all customer data remains with the company, offering continuity and stability through employee transitions.
Ultimately, Ward said, the cumulative benefit of these technological advances for grain merchandisers is the array of options available today to communicate with farmers. Dictating forms of communication doesn't make customers feel valued; but offering their communication preference — and more — demonstrates commitment to meeting their needs.
Instead of viewing technology as a one-size-fits-all solution, give customers the ability to move at their own pace and communicate in the way that suits their comfort level and operations best. As technology continues to reshape the grain industry, embracing flexible communication options will empower merchants and farmers to build stronger, more efficient partnerships.
