Wynnstay sees recovery in ag commodity prices

Wynnstay forecast a revival in agricultural commodity prices, even as it highlighted the dent from lower values to its performance – slowing below 2% growth in the group’s annual pre-tax profits. The UK-based farm supplies-to-grain trading group acknowledged that depressed ag prices “remain a concern, especially for the dairy sector”, where low margins have heightened fears about an exit of UK farmers from the industry. However, while there “are only limited signs of a reversal for our farmer customers at this point”, supply and demand fundamentals “should drive a return to more realistic prices”. “We expect global food and energy demand to return output prices to more realistic levels, bringing renewed vigour to the sector,” said Ken Greetham, the Wynnstay chief executive. “Macro-economic factors remain compelling.” ‘Agricultural deflation’ The comments came even as the group unveiled the slowdown on its performance in the year to the end of October stemming from falling ag commodity prices, fuelled by strong grain harvests last year both in the UK and in many major producing countries. The group’s agricultural division, including the feed and seed supply operations, and grain trading, reported a 22% drop to .80m in operating profits for the year, on revenues … continue reading

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