Angus Cereals is a grain storage and drying facility planned for construction at the port of Montrose. It will serve cereal growers in the Perth, Angus and Kincardine areas. Yesterday, in the Scottish national and regional press, it made an appeal for more cereal growers to invest in the project in the next fortnight to ensure Stage 1 of the project proceeds as planned. The articles illustrate the many advantages for farmers of investing in central storage, though I feel that the economic reasons for investment are a little less clear.

The advantages detailed are numerous but essentially relate to offering farmers peace of mind in post harvest. Advantages included; no need to arrange labour for grain drying or transport, drying and storage does not interfere with other on farm activity, no need to worry about rejected loads and, once in store, the grain will be professionally marketed by Openfield, the UK’s largest farm-owned grain business. The system advocates crops going off farm immediately after harvesting and straight to Angus Cereals.

There is no doubt that this would mean less work for the farmer but do these proposed “operational efficiencies” result in an improved economic return for the producer? Regardless of wheat prices, be they favourable as they are now or poor as they were only last season, is the most prudent business decision to add the maximum value to a crop on-farm before sale or have the entire process managed through investing in a central storage scheme like Angus Cereals? Continue reading →