We are independent & ad-supported. We may earn a commission for purchases made through our links.

Advertiser Disclosure

Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.

How We Make Money

We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently from our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What is a Grain Broker?

Mary McMahon
By
Updated Mar 02, 2024
Our promise to you
Practical Adult Insights is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At Practical Adult Insights, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

A grain broker is someone who facilitates the purchase and sale of grain. Like brokers in other areas of the financial industry, grain brokers serve as a point of connection between buyers and sellers, working to get the best deal for all parties involved. The size of a grain brokerage can vary, depending on where it centers its operations.

Grain brokers may work at local markets and they can also work at large commodity exchanges, which are often located in urban areas near railway hubs to make trade easier. When a farmer approaches a grain broker, the broker takes a sample of the farmer's grain. The grain is inspected for quality and stored in the brokerage. The broker in turn meets with people who want to buy grain, providing them with access to the sample and negotiating a price which will be amenable to both parties.

To become a grain broker, it is usually necessary to have a bachelor's degree in a field related to finance or agriculture. Some have degrees in public relations and communications, because communication is key to being an effective broker. Brokers can work for a brokerage under more experienced brokers or they may operate independently. On a local level, a single broker may be able to handle the day's business, while brokers who work with commodity exchanges usually need the support of a large office with numerous personnel.

The grain broker typically takes brokerage fees for every deal arranged. These may include flat fees per unit of grain in addition to percentage fees based on the amount of the deal. The broker discloses these fees up front so that buyers and sellers can decide whether or not the fees are acceptable. Brokers who charge high fees may also offer special services as an incentive for people who might otherwise turn down a relationship with the broker on the basis of cost.

Working as a grain broker requires a knowledge of the commodities market as well as the ability to predict, at least to some extent, market movements. A broker who does not think ahead can end up with unsatisfied clients such as buyers who pay too much for a grain which falls out of favor or is produced in surplus or sellers who are angry that their grain sold at a price lower than it deserved. However, even with the best skills and years of experience, a grain broker ultimately cannot make predictions about market movements with confidence.

Practical Adult Insights is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Mary McMahon
By Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a Practical Adult Insights researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.

Discussion Comments

By amysamp — On Jul 19, 2011

@geekish - I honestly don't know how difficult it is, but from looking at a few websites about commodity trading it seems you are exactly that - only a commodity trader. It becomes your niche rather than something you do part of the time.

Right now I am enjoying learning about investing in businesses so I think I will stick to that as opposed to trying to learn about this venue of trading grain and other commodities!

By geekish — On Jul 19, 2011

@amysamp - I agree, the financial markets are incredibly expansive. Then just add in the fact that there are different markets such as the NYSE and the NASDAQ and now there is another market within these markets?

I think the commodity market which includes jobs such as a grain broker sounds interesting. Is it difficult to become a commodity trader?

By amysamp — On Jul 18, 2011

I have just found yet another area of finance for me to learn about. Grain, really? Who knew?! I was interested in just the stock market, and thought it would be pretty easy to get a handle on. However, I am just learning the opposite.

Since learning about the stock market, which I thought was just about businesses and choosing which businesses I thought would do well based on their products or services and business model. But I keep finding new things, such as commodities which include grain, ethanol, and other everyday items!

I can't believe there is such a thing as a commodity broker who deals specifically with grain! But I guess what I am learning with the financial markets is to never be surprised, and that there is always something new to learn.

Mary McMahon

Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a...

Learn more
Practical Adult Insights, in your inbox

Our latest articles, guides, and more, delivered daily.

Practical Adult Insights, in your inbox

Our latest articles, guides, and more, delivered daily.