Sell grain during season to tackle fluctuating prices
Published 19/07/2011 | 05:00
This year's winter barley harvest has been slow to get going. Some crops were harvested last week in the south of the country and reports are variable. It appears that the better crops will be the later ones to be harvested.
There has been a long grain-filling period this year, which will stand to yield. I have had reports of yields of 3-4.25t/ac with good KPH of 66 or more.
It is interesting to look back on prices for barley that were appearing at the start of last year's harvest. Initial indications were for €120-125/t, while prices eventually paid were closer to €130-140/t. The indications this harvest for green barley are currently €153-€160/t. The big question is what will the eventual price be?
The current price is significantly less than what was available to growers two months ago if they had opted to forward sell their grain. Some green barley contracts were done in May for up to €190/t, which looks very attractive now. However, this simply proves how volatile prices can be and why growers should consider selling their grain throughout the season. This allows a range of prices to be achieved and invariably leads to a better overall price.
Many growers become annoyed at harvest time, just as they are about to take out their combine, that prices automatically appear to drop. However, we have learned over the years that this is normal practice. Growers should be prepared for this and forward sell a portion of their grain over the season.
Obviously, harvest pressure is currently at play to weaken harvest prices, but it is not as simple as this as there is much speculation and varying reports emanating from the major grain players across Europe, Russia and America to drive grain prices upwards and downwards at different times of the day.
For example, over a day and a half period last week, the price of barley fluctuated by €15/t. Grain traders are currently indicating that prices vary every hour, never mind everyday, so the grain trading situation is currently very erratic.