Harvest Festival

My Mother went to the church Harvest Festival Service in the village on Sunday, on her own as these days you will only get Father there for a Wedding if any of the Grandchildren get round to it, a Funeral if you were very close to him(but not his own) or possibly a Christening, but all the older grandchildren are happy practising.  

She went as always because she likes a sing!  Not to give praise for the harvest and all the bounty it had bestowed upon us, but to celebrate the fact that it was over, and her grain trading son had survived with his mental health intact 😊. 

Both Mother and Father appear to have spent more time worrying about harvest and the grain trade this past 4 months than they have about Covid-19 and its possible effect on two people of a certain age, who would rather spend their time out walking, golfing or eating out and being with family and close friends than stuck inside at home.

There are similarities across all things farming, grain trade and covid.  It is all about risk and your attitude towards it.  Do you take a cautious approach to farming, growing a range of crops/livestock spreading your risk with varietal choice and a mix of marketing strategy? Or sow the whole farm with wheat at the earliest possible date then sit back and accept the vagaries of black grass, pests and disease through the growing season? Harvest all you can but sell nothing until the last day of June the following year?  As a grain merchant we manage our positions, trading little and often.  Avoiding massive long and short trading positions so we can sleep easy on a night knowing we have not bet the house on a huge rally or fall in prices.  With Covid most will manage their contacts, trusting family and close friends where Government policy allows, whilst staying clear of perceived high-risk situations.

Which brings us back to harvest 2020 and the supply/demand price ratio of UK Wheat.  No matter if you went to Church on Sunday and gave thanks for a bountiful harvest safely gathered in, or to thank the Lord it was over, wheat in the barn currently trading at £180 per tonne represents more per tonne than anyone ever budgeted for this harvest.  Waiting to sell all that wheat at £200 per tonne represents a whole heap of Risk.  This week we traded Group 1 milling wheat at £210 per tonne to one miller.  It took a lot of phone calls to cover the mills required order.  Clearly some think that despite the huge amounts of German imported milling wheat coming into the Humber there is more upside to come.

Try walking down a street in Liverpool, kissing everyone you meet on the lips and expecting not to get Covid.  You might be lucky, but the odds are stacked against you.

Furthermore, if weather permitting the largest potential wheat area to be sown in the UK for some years finally gets sown, £150 per tonne for a September 2021 representing a small percentage sale would likely be a low RISK strategic sale.

I tend to side more with my Father than Mother when it comes to Church, so I did not go on to Harvest Festival on Sunday.  But when it comes to Covid and the price of UK wheat I will be managing my risk.

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