Gleadell Agriculture has achieved a significant premium over average market returns for both commodities during the period.
For the feed wheat pool, an average price of £129/t was recorded, while the oilseed rape pool returned £283/t to members.
David Sheppard, managing director of Gleadell, said the result indicated “a good performance in a volatile trading environment.”
“The decline in wheat prices during autumn 2008 was steep and rapid,” he said. “Despite a steadily weakening pound, without which UK feed wheat would have traded in the £60s, prices declined to below £85/t ex-farm, and then bounced in the run up to Christmas.”
Most of the pool had been sold at higher prices pre-harvest 2008, he revealed, and all had gone by mid September as the company observed market trends.
Jonathan Lane, Gleadell’s oilseed rape trader, was also satisfied with the pool results.
“However you look at it, 2008 was an exceptional trading year. In early July, soybean futures peaked, driven by concerns about inadequate supplies. Fuel was added to the fire by fund managers and speculative investors piling money into the commodity markets,” he said.
“The strength in the soy market spilled over into other oilseed, meal and vegetable oil markets, and rapeseed prices benefited from the boom. But the boom was followed by a bust that started in July and saw the largest percentage fall ever registered.
“It has been very difficult to make predictions in these volatile times, but we aimed to sell our pool tonnage into any rally we saw, and believe our pool result of £283/t represents an excellent return.”
Gleadell’s 2009 pools are now open and Mr Sheppard reports a large increase in committed tonnage over 2008. “Forward markets will remain volatile and may be more challenging than ever in times of financial turmoil and rapid movements in currency levels,” he said.
About 10% of the predicted new cop pool has been sold already.
For comment on grain trade trends and other agribusiness news log on to Phil Clarke’s Business Blog and add it to your list of favourites.