Preservation of Cash for Buyer & Seller
Benefits of Barter
During difficult economic times farmers may face high finance costs. Conversely, equipment and agricultural supply sellers may face slow movement of products in those same markets- leading to lost opportunities and growing surpluses. For both farmer and supplier this may increase the likelihood of downsizing and/or the reduction of inventory holdings. The Ormita barter solution improves liquidity by allowing farmers to self-finance essential supplies. Repayments are not made in cash; but with existing or future production. Agricultural equipment, machinery and chemical suppliers, in turn, are able to utilise trade credits to offset many of their fixed operational costs of their businesses (offsetting real cash expenses) Other benefits are as follows: • Farmers in certain countries may otherwise have a higher cost (or no access at all) to trade finance. In such instances bartering of commodities may be the only alternative solution to traditional finance • Preserves hard currency. • Reduces the risk of currency volatility (for both buyer and seller). • Bypasses currency convertibility issues (for both buyer and seller).
Financial challenges facing farmers Market price fluctuations Increasing costs for essential supplies
Currency convertibility
Lack of surplus cash
Farmer
Increasing requirements for energy and water efficiency
High cost of interest
Lack of financing mechanisms Competition
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