Read more about Cereals 2007 here

As I wrote this introduction, we enjoyed record temperatures over the Easter holidays. Newspapers were full of children enjoying ice-creams, reports of the UK experiencing higher temperatures than some European holiday resorts and the pound soaring against the dollar. Other than causing a rapid workload for arable farmers, what does this have to do with Cereals 2007? Well they are signs of changing climate, both financial and weather.

For me, Cereals 2006 was a very positive event which set a great tone for the rest of the year. I was extremely impressed and felt that the atmosphere and general buzz that ran through both days was very tangible. I couldn’t identify the factual basis for some of this positive feeling, but it was definitely there.

Well, things have moved on since last year. Within the industry, last year’s hopeful optimism towards cereal and oilseed markets has begun to translate into reality, with alternative uses for cereals now having an impact on the global marketplace – and with possible issues for food versus fuel becoming very real, our industry is back in the limelight as being needed again.

It would be easy to get carried away on a sea of optimism that positive press towards the agriculture industry, decoupled support payments and rising world prices could generate. Our view is that those who will succeed in this more volatile world into which we are heading will inevitably be those with businesses based on sound footings, who have got the basics sorted out and managed effectively.

Sorry to be boring, but by this I mean that costs of production are understood and controlled and risks are identified with a strategy for their management when they change – all solid management skills that farmers have developed over the last few years, and which will remain no less important. However, there will perhaps now be the requirement to add Brent crude oil price, raw cane sugar prices and palm oil plantings in Malaysia to currency and futures prices as essential everyday reading.

Invest in the future

HSBC AT CEREALS
  • 2006 optimism has continued
  • Alternative uses for cereals now having an impact on markets
  • Businesses need sound footings to succeed in volatile market
  • Improvement needed in business planning
  • Know your cost of production

Last year, we questioned those attending the event about their plans for the future of their businesses. The results of our survey told us that while confidence was improving, information to enable businesses to plan and make decisions for the future was still the single biggest piece “missing” from the management jigsaw.

This concerned us because, as a stakeholder in the industry, we needed to continue with our philosophy of investing in the future of farming and we had to help the industry to remain confident and continue to ask the right questions of the right people to gain the necessary missing information.

With more hard and fast information available in 2007 to enable business heads to make longer-term decisions with more confidence, we are using our “Investing in the Future” forums over both days to concentrate on topics that we regularly raise and find raised with ourselves: Do we understand our industry’s carbon footprint and what it could mean? What are the real practical impacts of biofuels on the marketplace? What opportunities will farming the environment offer farm businesses?

Industry speakers include Peter Kendall, Jonathan Scurlock, Richard Whitlock, Graham Lacey, Guy Smith and Caroline Drummond. We’re going to try to give more time for each forum topic by having two speakers addressing some (or all) of these themes, so don’t miss out on what promises to be a real centrepiece to this year’s event.

Cereals 2007 will give all who attend a clear no-nonsense view of the prospects and pitfalls that face us. We are pleased to continue as principal sponsor of the Cereals event and our agriculture managers will be available throughout both days to give you a down to earth and well informed view of how HSBC Agriculture sees the future. Please make time to come and compare your outlook with ours.

Read more about Cereals 2007 here