12 September 1997

Cereal growers relief

AFTER a difficult spell for cereal growers the worst is over – at least until further CAP reform.

That was the message from Midland Bank, conveyed by regional agricultural manager Tony Molyneux at an Arable Research Centres presentation.

"1997 has been one of the most challenging seasons for a number of years," said Lincs-based Mr Molyneux. Besides the weather, growers had had to contend with adverse currency movements and relatively expensive inputs.

But these were now on the way down and sterling was also starting to weaken. The bank forecast that the £ would be worth just DM2.6 by Christmas 1998, (compared with the recent peak of over DM3), with positive implications.

Growers tended to forget that they still received the equivalent of £30/t in area aid, added Mr Molyneux. Farm businesses were well-placed to face the future having reduced borrowings and invested in new equipment.

Global supply and demand continued to be in balance and he foresaw little reduction in world prices.n