By FWi staff
AN electronic trading service is set to revolutionise UK trading in grain and other commodities, claim the schemes backers.
GrainNet, launched last week at the Royal Show in Warwickshire, matches buyers and sellers direct, according to price and other criteria.
“It is an additional service which, over the long-term, will allow growers to market their grain more efficiently,” said Hugh Marriage, managing director of GrainNet.
It has been developed by Newbury-based grain-silo operator and software developer H Dolton & Son Ltd.
It enables farmers to seek buyers for their grain, specifying delivery period, quantity, quality and required price.
Once a match has been found, the service e-mails both parties, and they can either reject or accept the contract.
It is completely confidential until the contract has been accepted, and can be used round the clock.
The site will become a valuable source of market information, able to report actual prices for commodities traded on the system, says Mr Marriage.
It will be especially helpful to producers of niche commodities by allowing them much more effective access to the market, he says.
Jeremy Cole, of independent grain broker Agricole, voiced his concerns:
“It is a good idea in theory, but there are a lot of potential problems. Once a contract has been accepted and identities are revealed, some farmers may not want to go through with it.
“If it is an unknown buyer they cant guarantee they will get paid, or the buyer may be some distance away, which could create transport problems.”
Paul Toseland of Viking Cereals said that there is a risk in losing the personal contact with the trader.
“Grain trading is too complicated to let the computer do all the work for you. If things go wrong, who will be there to help the farmer?”
GrainNet is free until the end of July and possibly into August.
After this period the annual fee will be 25 for sellers and 50 for buyers. There is also a transaction fee of 0.1% of the match value, payable by the buyer.