Farmer-owned co-op Openfield returns to profit

Farmer-owned co-op Openfield Group returned to profit in the year to 30 June 2015 with a pre-tax profit of £2.4m.

This is a £6.6m improvement on 2014’s loss of £4.2m for the group, which has 2,700 farmer members and works with a further 4,000 farmers.

The better performance at the grain and inputs business follows two difficult years after the poor quality and yields of the 2012 harvest and a smaller national crop in 2013.

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The group exported 1m tonnes of grain and other farm produce in the year, getting a better deal for farmers, said chief executive officer James Dallas.

With yields above the long-term average, harvest 2014 gave generally acceptable quality, although with lower proteins for some crops, said the co-op. In addition to a more favourable harvest, volume and margin were boosted by the purchase of the grain business of Countrywide Farmers on 1 January 2015.

Openfield also brought its transport operation back in-house after several years of this being managed by DHL Supply Chain.

During the marketing year Openfield lost the marketing contracts for farmer grain storage groups Aberdeen Grain Storage and Camgrain, however the acquisition of Countrywide Farmers grain business more than made up for this loss of volume, said Openfield.

Borrowings at the year-end rose to £7.75m, up by about £2m on the previous year. However, the company said this was entirely within the working requirements of the business and reflected the point in the cashflow cycle.

During the year Openfield collected payment from customers up to three days earlier than in previous years, enabling it to pay farmers on average nine days earlier.