Shropshire Star

Using contracts to ease those grain groans

Grain contracts are a very important part of our business.

Published
David Roberts, G.O Davies Ltd

They act as a confirmation of a verbal agreement which is binding, and it also means that all parties know what they should be moving, when and at what price. What could be simpler?

The reason I mention this is because I am frequently asked by farmers the same question: “A merchant hasn’t moved our grain as per contract terms - that is, not in the right month. What can I do?”

Of course, the flippant answer is “you should have sold it to us!”. However, being more constructive it is always useful to point out that the contract is there to protect both parties and there are a number of clauses that do that. But there can be genuine reasons why the grain hasn’t moved and that is easily resolved by both parties agreeing to carry over into the next month with suitable compensation of a £1 generally being agreed.

There seems to be a worrying trend by one or two merchants to pay up over the market price and leave the grain there for two, three, or four months and hope the market goes up. This is not the way forward and reminds me of the saying about men bearing gifts!

That brings me on to the markets which have been fairly range-bound with wheat, but there has been some excitement with barley and oil seed rape which have both risen steadily. The very interesting point regarding the wheat market is that it may be affected by the closure of the Vivergo plant for maintenance for the next three months.

The fertiliser market has taken a dynamic all of its own with new prices being issued and withdrawn before we have the chance to pick up the phone and ask how our farmer customers are. I am sure the market will settle soon.

As far as spring barley seed is concerned, I am told that we are exporting some barley seed for the first time in years and that seed could go short - order now while stocks last!

Here at Westbury we are still having the benefit of the youth effect with customers now able to access their account online. Blimey now, where has my pen gone ... or has the young’un had it!

David Roberts, G.O. Davies (Westbury) Ltd