Farmers should secure their winter feed, minerals and fertiliser urea now amid fears that prices could hit highs later in the year as supply dwindles.
Speaking during a recent webinar looking at the markets, Mole Valley Farmers said farmers could lose more than they would gain by holding off their purchase.
“It may be a bit earlier than usual, but you could wait and gain £5/t or lose £15/t," said Daniel McCreadie, head of agri procurement at the agricultural supply firm.
"The market for grain and protein has bottomed out and is now a rising market rather than a falling one,” he warned.
Mr McCreadie described the grain market as ‘bullish’ with prices in July 2022 hitting a high of £360/t before falling back to £260/ t.
Ukraine did not enter the shipping programme this week, and combined with the weak pound to the dollar, has resulted in prices rising again.
Meanwhile, soya is steadily increasing week-on-week at about £10-£12/t, with jumps of £20 in a day also reported.
He added: “Markets are volatile and moving aggressively. From a risk management perspective, it makes sense to secure your needs for winter.
“Grain prices will rear their head as we head into September and October when there is less. We may see prices rise dramatically due to supply and demand,” he said.
Neil Berryman, also of Mole Valley Farmers, suggests farmers look at their winter requirements for minerals, with volatility affecting the market.
He advised farmers to look at their mineral requirements first by assessing the rations to ensure they are not overfeeding them.
He said: “Phosphates historically have tended to be overfed, which will come at a significant expense.”
Farmers should also expect to see hikes in products like dry cow minerals as magnesium prices rise due to the volume of gas used in its production.
Craig Paterson, head of fertiliser at the company, explained how urea for September delivery would see some increases.
Still, there could be an opportunity for farmers to buy on discounted spot value in August, he explained.
The availability of the product from normal origins is significantly reduced, so we will see further issues with curtailing production. My advice is to get some product on farm sooner rather than later.
“If you are producing muck, get it analysed and utilised into a plan with bagged product,” Mr Paterson added.
The weak pound to the dollar was adding up to £50/t to granular urea alone. “Prices are being issued and pulled in the hour. A £30 increase is the new £2 increase."
