Farmer-owned grain marketing business Openfield has reported a fall in pre-tax profits from £2.6m to breakeven in the year to 30 June 2013, following a poor 2012 harvest.
Openfield, owned by 2,700 farmers, saw turnover drop 8% to £710m, as a 16% reduction in the volume of grain handled cancelled out higher average commodity prices.
The loss of export markets for UK crops following the poor 2012 harvest led to longer stock holdings and a jump in interest charges from £0.6m to £1.8m.
Borrowings grew from a net debt of £8.2m in 2011-12 to £28.6m in 2012-13 as old crop was held back longer to meet consumer demand.
Openfield CEO James Dallas said the results confirmed the business’s progress in getting value for its members and delivering excellent service to its supply chain customers.
“Never was our support for UK farmers more important than in the aftermath of one of the poorest harvests in recent times,” he said.
“Conscious of the difficulty many UK farmers had with their poor quality grains, Openfield determined, as a policy, to work tremendously hard to market these crops in the most advantageous way possible from a members’ perspective.
“This undoubtedly had a negative impact on our profitability but it is entirely consistent with our co-operative principles.”
Openfield also announced strong results from its autumn 2013 marketing pools, for crops moved between October and December.
Members received an average of £165.56/t ex-farm for feed wheat.