20 August 2009

2 minute read

Europe

Mr. McDonnell said, “Farmers grow grain and farmers feed grain either straight or as a component of a compound feed ration but the middle man takes a hefty margin in between.

At current indicated prices it will take between two to two and a half tonnes of feed barley to pay for a tonne of compound feed. It doesn’t take an economist or mathematician to see who is being ripped off. Sourcing grain direct off the combine will add euros to both growers and feeders’ bottom line. With all enterprise margins under extreme pressure it is critical that all unnecessary costs are stripped out.”

“Growers where possible should hold onto their grain, acid treat or store it on air where moistures allow. At current indicated prices of €95 to €100 (exclusive of vat) for barley and wheat €5 to €10 over, whole or rolled native cereal is by far the best value high energy feed on offer today. Invariably once harvest is complete and the store doors close grain and compound feed prices to livestock farmers will rise. With forage and fodder supplies tight on many livestock farms there is a considerable increase in demand for cereals from feeders.”

“Growers should consider all their options before dumping grain in the merchants’ yards. They should not be panicked into offloading grain without a price commitment when higher priced alternative market opportunities exist out there. The market for farm-to farm trade has grown considerably in recent years and will grow further given that livestock compound feed rations are currently retailing from €200 to €240/t.”

“Farmers should evaluate all options before deciding what way they want to sell the grain this harvest.”

The main options are: 1. Trade direct Farm-to-Farm 2. Sell for crimping (window closing rapidly) and caustic treatment 3. Aerate and store 4. Acid treat and store whole or rolled 5. Do a deal on merchant drying and storage

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