Grain merchants feeling the draught too

[Widgetone]

So Fengrain losing some money, Gleadell reporting a downturn, Openfield reported a cold earlier in the year, whilst Frontier buck the trend with some better numbers it seems. Interesting times.

 

[Flat 10]

Whilst its nice to see the pain shared around it's not helpful for us as growers to have any well grain scenarios or further consolidation in the sector IMO.

 

[MrNoo]

Trouble being some of these big companies dont help themselves, it would be very interesting to see how the smaller independents have done. I am a member of one of those mentioned and won't be selling anything this year through them, just fed up with the service, never answer a phone and if you leave a message you'd be lucky to get a call that same day. Crap.
Same with seed orders. Crap.
Dealt with a small independent and service was how it should be, some of these larger companies should take note. But then I guess I am small fry compared to some.

 

[Barleymow]

deal with a small independent rarely get any claims pays within days of collection collects grain when requested. Always answers phone or 're calls promptly

 

[David.]

I too deal with one of them, they took over an independent that I had dealt with for years; but mainly because I see no other realistic outlet for oats.

 

[Widgetone]

So who else is there, and how are they doing? ADM, Glencore, Cefetra, Cofco, Grainco, then smaller regional players like Appel, Bartholomews, Dewing, and Saxon. Any obvious omissions, this list is a bit South Eastern. Then I suppose you can sell directly to a mill/maltster which can be effective for local deliveries and reciprocal feed buying if it suits.
Been a another recent period of consolidation with one of the above in particular snapping up smaller merchants who are throwing in the towel for one reason or another.

I suppose the point is we don't really want less choice of buyer do we?

 

[Baling Hay]

Out of interest how much margin do you think a merchant makes on a tonne of grain or rapeseed?

 

[Widgetone]

£1-3 average?
Before costs.

 

[Baling Hay]

£1-3 average?
Before costs.

SO let's say £2 per tonne or £58 per truck load. A load of rapeseed is worth close to £10k and a merchant gets £58 margin.

For the £58 margin they take on the following:

• Pay a farm trader to call farmers and buy the grain
• Manage the currency risk
• Manage the flat price risk
• Sell the grain
• Organise the transport
• Sort out the assurance and sustainability paperwork
• Sort out all the paperwork
• Oh and then if a farmer refuses to load and the merchant has to haul from distance or be defaulted.....

No wonder the industry is in tatters!!

 

[DRC]

SO let's say £2 per tonne or £58 per truck load. A load of rapeseed is worth close to £10k and a merchant gets £58 margin.

For the £58 margin they take on the following:

• Pay a farm trader to call farmers and buy the grain
• Manage the currency risk
• Manage the flat price risk
• Sell the grain
• Organise the transport
• Sort out the assurance and sustainability paperwork
• Sort out all the paperwork
• Oh and then if a farmer refuses to load and the merchant has to haul from distance or be defaulted.....

No wonder the industry is in tatters!!

Did you see that tweet about openfield recently, begging all their members to sell 100% of their crop to them.

 

[Widgetone]

Ok

Did you see that tweet about openfield recently, begging all their members to sell 100% of their crop to them.

Tad fanciful

 

[An Gof]

Did you see that tweet about openfield recently, begging all their members to sell 100% of their crop to them.

Begging is no good, they need to make a business case. I was most disappointed in Openfield with that communication ....... makes me wonder who's running their Comms team.

 

[An Gof]

SO let's say £2 per tonne or £58 per truck load. A load of rapeseed is worth close to £10k and a merchant gets £58 margin.

For the £58 margin they take on the following:

• Pay a farm trader to call farmers and buy the grain
• Manage the currency risk
• Manage the flat price risk
• Sell the grain
• Organise the transport
• Sort out the assurance and sustainability paperwork
• Sort out all the paperwork
• Oh and then if a farmer refuses to load and the merchant has to haul from distance or be defaulted.....

No wonder the industry is in tatters!!

Try growing the stuff and see what the "margin" (??) has to cover

 

[MrNoo]

Openfield is who I have been with for years, no business from me this year.

 

[kiwi pom]

Try growing the stuff and see what the "margin" (??) has to cover

If the growing parts the poor paying bit why aren't more farmers also merchants?

 

[An Gof]

If the growing parts the poor paying bit why aren't more farmers also merchants?

You might as well ask why we aren’t all brain surgeons!

 

[7800]

SO let's say £2 per tonne or £58 per truck load. A load of rapeseed is worth close to £10k and a merchant gets £58 margin.

For the £58 margin they take on the following:

• Pay a farm trader to call farmers and buy the grain
• Manage the currency risk
• Manage the flat price risk
• Sell the grain
• Organise the transport
• Sort out the assurance and sustainability paperwork
• Sort out all the paperwork
• Oh and then if a farmer refuses to load and the merchant has to haul from distance or be defaulted.....

No wonder the industry is in tatters!!

If it’s as you say, how come frontier made good money on their grain trading this year as reported in last weeks FW
I wouldn’t feel too sorry for them

 

[Banana Bar]

Begging is no good, they need to make a business case. I was most disappointed in Openfield with that communication ....... makes me wonder who's running their Comms team.

It’s put me off using them even more than I had been already!

 

[nick...]

I use openfield alot and cant fault them on anything.got an excellant rep who i regularly speak to aswell.
Nick...

 

[Renaultman]

Trouble being some of these big companies dont help themselves, it would be very interesting to see how the smaller independents have done. I am a member of one of those mentioned and won't be selling anything this year through them, just fed up with the service, never answer a phone and if you leave a message you'd be lucky to get a call that same day. Crap.
Same with seed orders. Crap.
Dealt with a small independent and service was how it should be, some of these larger companies should take note. But then I guess I am small fry compared to some.

I know how you feel, I have had a long term relationship (ooh er missus) With a small cooperative that has become a biggish company. Nowadays they don't seem that interested in my little but so most of my orders /sales go elsewhere. I know for certain if I had 1000 acres they would be bending over backwards to do business with me.