April 7, 2017
Correspondent North America
There’s a Canadian online grain trading service – billed by some as the eBay of the grain trade – that’s changing that marketing game for farmers.
FarmLead, based in the Canadian capital Ottawa, is an award-winning online platform that connects grain buyers and sellers 24 hours a day.
Since launching in 2013, the service has enjoyed rapid growth, and currently serves more than 4,000 farmers and more than 300 buyers in North America. And now it has grabbed the attention of the venture-funding world.
Monsanto Growth Ventures – together with Avrio Ventures, the MaRS Innovation Accelerator Fund and Serra Ventures – has just led a $6.5m investment into FarmLead to help the young company open a Chicago office for better access to the US and continue its marketing and promotional efforts.
Storing canola in a grain storage bin near Holland Manitoba, Canada. Photo credit: Design Pics Inc/REX/Shutterstock
Founded by Alain Goubau and Brennan Turner, the service allows buyers to post their bids online or connect directly with farmers who have listed their grain for sale.
To use FarmLead, buyers must undergo a credit check to ensure they have cash-in-hand for any grain they buy. Farmers post pictures of the crop they have for sale, as well as grading certificates that prove buyers will get what they pay for.
All negotiations through the platform are done anonymously up front, with buyers and sellers focusing on key deal aspects such as price, freight and discounts. Forward contracting is also possible.
Posting and negotiating on the site is free, but FarmLead collects a small fee on each successful transaction. Farmers pay a fee of $1 per metric tonne for the first 80t, and $0.25/t thereafter. That means a deal involving 120t will cost a seller a total of $90.
FarmLead has focused solely on the North American market so far, but I’ve no doubt it will be looking to international opportunities in the future as more grain buyers and sellers hear of the service.