New platform in the making
Dairy trade gets a makeover
A new platform is being developed that will make it even easier to trade dairy products in the future. Currently, trading takes place over the phone (subject to the broker's availability). With the DAO.EU platform, those obstacles will no longer apply. Does this also offer opportunities for dairy farmers?
With Dao.eu Dairy Auctions Online (DAO) launches a new method of doing business in dairy land. It will be exciting, because while digitization in the form of futures markets to manage risks is already more common, this does not yet apply to trade. With the introduction of an online platform, the trade is also given the opportunity to modernize. Boerenbusiness List the 3 most important things about this platform.
What does it offer dairy farmers?
The new platform can be compared to marketplace. However, there is a difference. When the asking price is offered, you can immediately proceed to sale/settlement. The Fill-Or-Kill (FOK) was created for this purpose. Initially, various types of milk powders, butter and fresh cream will be offered on the platform.
This means that it does not yet offer immediate opportunities for dairy farmers. The platform therefore focuses mainly on the trade, the processor and the end user. Indirectly, it may well provide benefits for the processor that dairy farmers deliver to. This in turn benefits the milk price.
How does it work?
The platform gives buyers and sellers the opportunity to act anonymously, but must provide a guarantee of the origin of the product. This means that the product really has to come from there.
In addition to the origin of the product, the seller must enter a price, specify the volume, give the estimated date of sale, prove the location of the product and indicate the documents necessary for the sale. When someone subsequently offers a lower price, the seller receives an alert and can decide for himself which next steps to take.
The new platform will not replace the Dairy Auctions Online auction. So it will continue to exist. The big difference is that 'the system is not a tender', according to Rik Loeters, owner of Dairy Auctions Online and DAO.EU.
Only when the sale has taken place, a fee is charged for the use of the platform, the broker fee. Also, the parties only get to know with whom they have done business after the sale.
Starting in July
The launch of DAO.EU will take place on Thursday 8 June during the Eucolait. From that moment on, interested parties can register. The platform will be online from July. Then it gets even more exciting, because the trade is willing to exchange the conversations over the phone for placing orders over the phone.
Loeters hopes to further streamline trading with the platform. It is also mentioned as an advantage that trading can continue 24/7. Perhaps in the long run it will also create benefits for the larger dairy farmers. For now, the main question is whether trade is ready for a breath of fresh air.
Herman van den Pol
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