The final total received by the producer would be determined by the eventual price which he received in the market. Producers' accounts would be updated periodically to bring them into line with the actual market results. An Example To illustrate how this might work, consider an example of a wheat farmer. Farmer brings in a crop of 20,000 bushels of wheat which he deposits in a bonded warehouse. Now since wheat is perishable, Farmer is not going to wait too long to market it, if he can help it.
Wheat has a limited storage life and proper storage costs money.
Unless there is an upward fluctuation in the market price sufficient to offset them, these costs will result in Farmer getting a lower eventual total return. If his account balance was insufficient to cover the debit it could be carried over and Farmer would receive that much less when his next crop was deposited. Miller must then take that amount of currency to the bank. Miller then takes the warehouse receipt to the warehouse, which allows him to withdraw the wheat. The warehouse receipt is then canceled.