As we sow, so should we farmers reap (From Gazette)

As we sow, so should we farmers reap

10:17am Monday 16th August 2010 in

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FOR as long as man has lived on earth and in every corner of the world, there is always a harvest.

Sometimes bountiful, sometimes meagre, and always dependent on the weather, harvest arrives as nature’s plants mature.

I find it difficult to explain to people that although we had been hoping for more rain throughout the past four months, all the arable farmer needs now is a dry August to gather the crops.

The dry summer has undoubtedly reduced the 2010 yields, but crops are reasonable and will be of good quality if we get fine weather now.

The difference with modern harvests is that we live in global, rather than local, markets.

The big story this time is extreme market volatility which has left experienced grain merchants in complete confusion.

Throughout the summer, wheat prices were about £90 per ton and farmers, whose cost of production is about £120, were contemplating a hefty loss.

As rumours spread of worldwide floods or droughts, prices gradually moved upwards and when they topped £100, most farmers started to sell some to reduce their deficit.

Then we all heard about the heatwave in Russia and the financial speculators clamoured to buy wheat.

How can any ordinary farmer write a budget or choose when to market his crop in these situations?

On August 2, a ton of feed wheat was worth £140, at 9am on August 5 it was £143, and when Mr Putin announced an embargo on Russian wheat exports, it reached £160 at about lunchtime. By the evening it was back to £150 and next day it was £143 again.

Although I am grateful to the speculators who have lifted prices back above the cost of production, I wonder who is actually making the easy profit from the 2010 harvest.

If any investors had early notice of the Russian export embargo, they certainly made a lot of money without the stress of moving combine harvesters along the A120 or worrying about the weather every day.

The public may rightly question whether such a “free” market is really fair to the farmer or the consumer. The situation is also causing problems for livestock farmers whose costs of straw, hay and cereals have rocketed.

On our own farm, we are making reasonable progress. Oilseed rape yields were exceptionally good, the pea harvest was amazingly easy and the combining of wheat is well under way between the showers.

Modern machinery is incredibly efficient with satellite-controlled steering, computerised controls and high output performance.

Soon the fields will change from gold to brown as cultivators incorporate the stubble. Oilseed rape for next year’s harvest is about to be sown and the whole farming cycle will start again.

I love farming, but sometimes I just wish I knew what rumours those financial speculators are going to spread next.