Accumulator Grain Contract

Farmers Coop Elevator Company is now offering a new series of Grain Contracts called the Accumulator through FCStone LLC. The Accumulator allows a producer to price bushels priced weekly to above the current market, at no up front premium cost, if certain conditions are met. Following is an example of how this program works.

Fixed Futures Price: $2.60 Knockout Price: $2.15 Futures CBOT Dec 2006

Pricing Period: 30 weeks (3/17-10/13/2006) Pricing Day: Friday Close

Bushel Quantity: 6,000 (There is a 1,000 bushel minimum.)

Producer puts 6000 bushels in the program. Beginning on Friday March 17th if the close of the market is between $2.15 and $2.60, the producer will get 200 bushels priced for that week at $2.60 December futures. From March 17th forward the producer will get 200 bushels priced each week at $2.60 futures if the market is trading between $2.15-$2.60, if the market is not in that range the following happens.

If anytime between March 17th and October 13th the December 2006 futures trade below the $2.15 knockout the contract is over. All bushels that have been accumulated up to that point in time are still locked in at $2.60 but there will be no additional bushels priced.

If the December 2006 futures close above the $2.60 swap price on a Friday Close then the producer will get 400 bushels priced for that week at $2.60 (note: the double feature is only on the bushels for that week it does not have any effect on previous bushels accumulated.) By doubling bushels under this contract the producer in the above example could end up with 12,000 bushels contracted if the market closed above $2.60 every week on Friday from March 17-October 13th.

If the market closed for 23 weeks between $2.15-$2.60 and over $2.60 for two weeks in the contract period before being knocked out in week 26 (when the market went below $2.15) the producer would have:

23 weeks x 200 bu = 4600 bu 2 weeks x 400 bu = 800 bu Total = 5,400 bu @ $2.60

The bushels are accumulated at a Dec. 2006 futures price of $2.60 and basis may be set at any time between the start and the end of contract. There is no premium cost to the producer unless he intends to roll bushels accumulated to a Hedge to Arrive contract.

Program is subject to change without any notice. This data and comments are provided for information purposes only. Commodity Trading involves risk and Farmers Coop Elevator Company and FCStone LLC assumes no liability for the use of any information contained herein.