Cereals 2009: Check grain contract terms carefully to avoid disputes

Arable farmers have been urged to take more time to look at the detail of grain contracts to avoid potential legal conflicts.

Addressing a seminar at today’s Cereals event, NFU combinable crops board chairman Ian Backhouse said market volatility over the past two years had increased the number of conflicts over price and delivery between farmers and traders.

“These problems have frequently cost members hundreds, and sometimes many thousands, of pounds and could possibly have been avoided by more use of some of the business risk management tools available.”

In particular, farmers should ensure they are clear of the final delivery terms, understand exactly where grain and oilseeds go after leaving the farm, what specification is required and what price will be paid, he said. Before agreeing a sale he advised farmers to read the HGCA’s cereal sellers’ checklist and use the NFU cereals contract to compare terms to the standard AIC grain or FOSFA oilseed contracts.

“In the unfortunate event of something going wrong, it is always worthwhile trying to resolve any disputes by mutual agreement,” he added.

The NFU’s CallFirst advice line can provide members with professional legal advice.