Green barley prices ‘hardening’
He said a number of buyers were indicating privately to customers that they will pay last year’s price for barley this harvest in an attempt to encourage growers to continue in cereal production for another year.
Mr Harrington said that €110/tonne is being paid for contract feed barley at 20% moisture exclusive of VAT in the South-East.
Competition among merchants for barley has intensified in the last few days in the Wexford region. Growers are being actively canvassed for their barley and up to €105/tonne is on offer for non-contract feeding barley at 20% moisture exclusive of VAT.
“There is a growing realisation in the trade that many growers will not cover the cost of producing a tonne of grain even at last year’s price levels of €102-€104 / tonne at 20% moisture exclusive of VAT.
“There is also a realisation that many growers are now subsidising the production of grain either from their arable aid payment, high margin crops such as sugar beet and potatoes and/or contracting.”
Mr Harrington said the introduction of the single farm payment (full decoupling from production) plus the restructuring option will allow farmers to assess the profitability of grain growing as a stand-alone business and take the necessary decisions.
It is clear that restructuring their entitlements onto a reduced area will be necessary for many operators and in some cases growers who cease grain production will increase their net profit.
For many wheat growers, the growing of second, continuous and latitude treated crops is becoming marginal, given the cost of production and the associated risk factors.
