Course 07 of 20 · Agricultural Commodities Desk Academy

Working Capital, Inventory Financing & the Borrowing Base

Stage B, Execution, storage and funding. Level 4 of 10.

The funding of the inventory and receivable cycle: borrowing base construction, advance rates and ineligibles, hedge margin as a cash demand, cost of carry as an interest charge, and covenant headroom.

121 chapters · 11 modules · every chapter one 8 to 10 minute explainer · builds on: Course 01, Course 05, Course 06

Enrol or enquire See the 121 chapters
How a chapter is delivered

One chapter is one idea taken to the point of use

Each chapter covers one idea to the point where you can use it, and comes two ways: a narrated explainer, and a deep dive audio discussion of around thirty minutes that works the same material at depth.

Self-paced throughout, and the same chapters can be taught as a cohort. Chapters run in order: each one assumes only what the chapters before it taught, and capability belonging to a later course is named and deferred rather than half-covered.

Curriculum

11 modules · 121 chapters

Open any module for its full chapter list, in teaching order.

M0 Why a Grain Book Runs on Borrowed Money Ch 1-10
  1. The Bushels Are in the Bin and the Cheque Has Cleared
  2. Margin Per Bushel and the Balance in the Account
  3. Advanced, Binned, Loaded, Invoiced
  4. Why Grain Money Arrives in Weeks and Leaves Over Months
  5. Out of Cash, Out of Availability, Out of Bin Space
  6. Who Lends Against a Pile of Corn
  7. What the Purchase Contract and the Elevator Already Settled
  8. Three Seats Around One Binned Parcel
  9. The Bushel as an Amount of Money Tied Up for Days
  10. The Funding Questions That Belong to Merchandising and Default
M1 The Cash Cycle From Farmgate Payment to Buyer Remittance Ch 11-22
  1. Dating the Money in One Autumn Intake Programme
  2. Paying the Farmer at the Scale Ticket
  3. Deferred Payment and the Farmer Who Lends You the Crop
  4. The Input Advance Paid Before Anything Is Planted
  5. Drying Fuel, Trucking and Rail Car Bills on Their Own Clocks
  6. Days in the Bin Before a Processor Calls for It
  7. The Grain Is on the Barge and Nobody Has Paid
  8. Invoice Date, Weight Certificate and the Day Funds Clear
  9. Counting the Funded Days From Scale Ticket to Remittance
  10. A Worked Grain Cash Line, Part One: Intake to Full Bin
  11. A Worked Grain Cash Line, Part Two: Loading to Collection
  12. Why the Second Unit Train Is Harder Than the First
M2 Interest as the Other Half of Carry Ch 23-33
  1. Turning Funded Days Into Cents a Bushel
  2. Where a Grain Merchant's Cost of Funds Comes From
  3. The Interest Half of the Cost of Carry
  4. Charging Carry to the Bin It Accrued In
  5. Carry on Grain You Have Not Paid For Yet
  6. The Processor Who Offers to Pay on Loading
  7. Terms Granted to a Flour Miller Are a Loan Nobody Called One
  8. Bushels Turned Twice Beat Bushels Held Once
  9. The Interest a Late Settlement Run Costs
  10. The Financing Charge Inside a Posted Bid
  11. The Rate the Desk Is Charged Internally
M3 Valuing the Grain a Lender Is Funding Ch 34-44
  1. What the Facility Counts a Bushel At
  2. Cost in the Bin: Farmgate Price Plus Everything After It
  3. Marking Basis-Priced Bushels From Two Separate Sources
  4. The Day a Futures Settlement Moves the Collateral
  5. Grain Bought on a Price-Later Contract
  6. Moisture, Shrink and the Bushels a Lender Will Count
  7. Grade Factors That Change What the Base Is Worth
  8. The Price Source the Facility Names
  9. A Share of a Bin Instead of a Lot
  10. Grain Owned, Grain Sold and Grain Held for a Farmer
  11. Corn, Soybeans and a Farmer's Wheat in One House
M4 Eligible Bushels and What Falls Out of the Base Ch 45-56
  1. The Eligibility Test Every Bushel Must Pass
  2. Grain Under a Licensed Warehouse Receipt
  3. Grain in a Bin the Examiner Has Never Visited
  4. Farmer-Owned Grain Sitting in Your Elevator
  5. Grain Loaded but Not Yet Billed
  6. A Receivable From a Crusher and One From a Country Trader
  7. Overdue, Disputed and Contra Accounts
  8. The Input Advance That Secures Nothing
  9. Concentration Caps on One Processor and One Crop
  10. Unhedged Bushels Treated as an Ineligible Class
  11. The Ineligibles Register and Who Maintains It
  12. Unpaid Producers Ranking Ahead of a Secured Lender
M5 Advance Rates and the Slice You Fund Yourself Ch 57-66
  1. Why a Lender Funds Only Part of a Bin
  2. Hedged Bushels and Unhedged Bushels Fund Differently
  3. Why a Warehouse Receipt Advances Better Than an On-Farm Bin
  4. The Proportion Advanced Against a Processor Receivable
  5. Reserves Set Against Shrink, Grade and Discount Schedules
  6. The Unfunded Portion That Caps How Much Grain You Can Own
  7. Advance Rates Reopened After a Bad Crop Year
  8. The Rate That Moved Because the Examiner Found Fewer Bushels
  9. One Soybean Parcel, Three Numbers
  10. Why Two Elevators Holding Identical Corn Borrow Different Amounts
M6 The Borrowing Base Certificate as a Document Someone Owns Ch 67-77
  1. Who Prepares the Certificate and How Often
  2. The Inventory Schedule, Bin by Bin
  3. The Receivable Schedule and Its Ageing Columns
  4. Deducting What Ranks Ahead of the Lender
  5. Applying the Rates and Reaching Availability
  6. Signing It: What the Officer Actually Certifies
  7. The Weekly Certificate Through a Harvest Week
  8. The Certificate After a Limit-Down Session
  9. The Schedule, the Bin Gauge and the Hedge Record
  10. The Break the Field Examiner Found
  11. What the Certificate Does Not Show the Lender
M7 Hedge Margin as a Claim on Cash Ch 78-89
  1. The Clearing House Joins the Queue for Cash
  2. Initial Margin Lodged the Day the Short Goes On
  3. Variation Margin Is Cash, Not Cost
  4. The Rally That Drains the Line While the Bin Gains Value
  5. A Daily Settlement Against a Monthly Shipment
  6. Dating Every Flow in One Hedged Corn Position
  7. The Margin Line Beside the Inventory Line
  8. Non-Cash Collateral and the Receipt Already in the Base
  9. The Call From a Broker Rather Than the Exchange
  10. Putting Next Week's Call Into This Week's Forecast
  11. The Hedge Was Right and the Line Was Short
  12. Margin Cash in the Monthly Funding Plan
M8 The Harvest Surge Ch 90-99
  1. Sixty Days That Fund the Whole Year
  2. Buying the Crop Faster Than the Base Can Grow
  3. The Seasonal Tranche Arranged Before the Combines Roll
  4. Deferred Payment Used Deliberately as Funding
  5. Prepaid Inputs in Spring and Grain in Autumn
  6. Two Hemispheres Overlapping in One Facility
  7. The Heaviest Cash Day of the Season
  8. Projecting Twelve Months of Grain Funding
  9. Sizing the Line From the Elevator's Own Capacity
  10. A Short Crop Against a Facility Sized for a Big One
M9 Covenants and Headroom on a Grain Facility Ch 100-111
  1. The Covenants a Grain Borrower Grants
  2. Working Capital and Net Worth Tests
  3. The Position Limit Written Into the Loan Agreement
  4. Measuring Headroom Between Availability and Drawings
  5. The Headroom That Vanished on a Price Fall
  6. When the Agreement and the Stock System Count Different Bushels
  7. Disclosing a Breach Before the Examiner Arrives
  8. What a Waiver Costs
  9. Committed and Uncommitted Money at Harvest
  10. Fees Beyond the Margin: Arrangement, Unused and Examination
  11. The Reporting Pack a Grain Lender Expects
  12. More Than One Lender on a Seasonal Book
M10 One Funded Grain Book Through a Crop Year Ch 112-121
  1. The Elevator, the Line and the Crop Year Ahead
  2. Spring: Input Advances Out and the Line Undrawn
  3. Harvest: Scale Tickets and a Base Growing Daily
  4. The Certificate at the Peak
  5. A Limit-Up Week and the Margin It Cost
  6. Winter: Carry Accruing on Unsold Bushels
  7. Unit Trains Out and the Seasonal Tranche Repaid
  8. Which of the Three Programmes Actually Paid
  9. Rerun With a Short Crop and a Slow Processor
  10. What a Borrowing Base Cannot Tell You About the Grain

The brochure gives each of these 121 chapters a paragraph on what it covers and what you can do once you have worked through it.

This is course 7 of twenty

It stands alone, and it is also the entry point to the Agricultural Commodities Desk Academy pathway.

Enrol or enquire See the whole pathway