Adam Loker, Southern IL University

Hello! I’m Adam Loker, a current junior at SIUC studying Agribusiness Economics
and Agricultural Communications. I am very grateful to be a recipient of the 2024 GFAI
Industry Immersion Scholarship, and in the past few months I have gotten to experience
a few very meaningful experiences because of it.
Growing up on a farm outside of a small town in southern Illinois, Wayne City
(about 15 miles east of Mt. Vernon), I have always been around agriculture. My whole
life has been spent around farming and agriculture. It hasn’t been until recent years,
however, that I’ve begun to grasp the true depth of the agriculture industry. Learning
about grain markets, trading, and the vast amount of knowledge there is to learn in the
grain industry has really opened my mind to the different possibilities in the grain
industry, and I am particularly happy to have gotten the opportunity to get a hands on
look at grain merchandising because of this scholarship.
On October 1st, 2024, I was able to go to the office of CGB at Mt. Vernon, IN and
speak with multiple people, where I learned about “the basics” and much more of the
grain merchandising world. Some of the most important lessons I learned revolved
around trade and futures markets, which are not-too-easy to digest topics when you are
just learning.
During my job shadow at CGB, I sat down with Paul Ernst, one of the originators.
Some key takeaways from our conversation and the day consist of the following:
● Understanding basis as the “barometer of demand at a given point.” In
commercial grain trade, it’s all about basis. It basically says, “This is how much I
‘want’ your grain.”
● Different types of grain facilities. There will be a different basis and differences in
operation depending where your facility is and what goes on there. For instance,
a river terminal functions differently than a rail terminal, and a soybean
processing facility has other important functions that separate it from the other
two.
● Freight spread: the cost of getting your product from point A to point B.
● The concept of carry, and how grain intrinsically gains value over time (which is
why farmers also store grain!).
● Price discovery: the price that “what you are willing to pay for” meets “what
someone is willing to sell at”.
During the conversation, we also talked about some of the most relevant topics in
agriculture. I asked Paul what he thought were some of the biggest risks to American
Agriculture. He responded with three different points: 1. Weather, 2. Competition
(particularly from South America), 3. Demand (it's important to not rely on mandates, the
free market is always best) ​Overall, I highly enjoyed the chance I had to visit with CGB. I am very grateful for
receiving the GFAI Scholarship, and look forward to my future in the grain industry!