Weigh up risk over crop price

This is the opinion of both grower representative organisations and Grain Trade Australia (GTA).

"Many growers have had a tough year in terms of production and the urge is to try and maximise returns, but they need to be aware the highest price is not going to be their best choice if they don't get paid," said Brett Hosking, president of the Victorian Farmers Federation (VFF) grains group.

His organisation was fielding calls from growers concerned with late payment for their grain.

"There are a couple of red flags out there at present in terms of marketers not paying on time," he said.

"I'd like to remind growers this is one of the classic warning signals when payments start running late."

There is concern within the trade growers may again face the issue of non-payment due to insolvency this season.

GTA chief executive officer Geoff Honey said growers should always check whether they were selling to a GTA member.

"It is one of the easiest pieces of due diligence you can do," Mr Honey said.

Mr Hosking said growers could take some commonsense precautions when selling grain.

"The easiest thing is to deal with reputable companies and those you have dealt with before.

"If you're looking to sell grain to somebody for the first time, ask around your neighbours and friends and see what their experience has been like, a couple of quick inquiries can save you a lot of heartache."

Mr Hosking said spreading risk was also critical.

"Where possible, share your grain around so you are not dangerously exposed to any one company.

"Obviously this is easier in the major commodities such as wheat than in more niche crops where there are less players, but try to retain only a safe exposure to any one company."

He said growers concerned about counterparty risk could also look at payment options including shorter payment terms so they are alerted quicker to issues with payment.

Mr Honey said along with checking for GTA member, growers should also do a background check.

"You should find out more about the organisation if you don't know anything, such as having a look at their products and their website to get a feel as to how well they are organised."