ESF raises a dram after posting a record £16m turnover
IT MAY be one of Scotland’s smaller farm cooperatives, but East of Scotland Farmers has proven it performs perfectly, posting both a record turnover and also an increase in profit.
In the year ending 31 May, the cooperative – which is based in Coupar Angus – pushed its turnover up to £15.58 million compared with £13.32m in the previous year. The profit in its 50th year in operation was also up 4 per cent, with a final plus figure of £392,360.
While the cooperative now deals with a wide range of inputs from fertiliser to footwear, the core business of the company remains the marketing of cereals, particularly malting barley. This past year, more than 60,000 tonnes of grain were marketed.
The cooperative works through a pool price system with growers committing their tonnage to the company and then leaving ESF to market it throughout the year.
Looking at the 2009 harvest, Robin Barron, general manager, heaped praise on international drinks giant, Diageo for the fairness in which it adhered to the prices and specifications on the grain it had contracted to take.
Barron’s view is in stark contrast with other organisations and individuals who criticised the multinational for its trading methods.
But he said: "Diageo is the wrong target. We had contracts with them and another major buyer and they both paid out more than the going rate. Our marketing pool has already paid out more than the harvest spot price and there are two further payments to come."
He added: "We are already talking to Diageo about the 2010 crop and while it is very early to be settling on prices for next year’s harvest, I have every confidence we will come to an agreement. The problem in the cereal sector is a straightforward one of supply and demand and the 2009 harvest produced too much spring barley."
He was far more hopeful that the open autumn we have just experienced will lead to an increased tonnage of winter wheat and this will take pressure off the malting barley market.
The company’s profitability last year also meant that it now has more than £2m in reserves. There are no definite plans for expansion, but Barron said some ideas were being discussed: "We have ambitions to expand."
After 32 years as director and ten as chairman of ESF, Bob Morris stood down at the annual meeting held last night, as did another longterm director, Gid Rutherford. George McLaren, of Bankhead of Kinloch, Meigle, stepped up to chairman. He was joined on the board by David Mitchell of Pairney, Auchterarder, a former NFUS vicepresident and current chairman of Scottish Agricultural Organisation Society and Colin Dargie, of Ledyatt, Lundie, who is a fulltime SAC consultant in Forfar and a partner in his family’s farming business
Original source : Andrew Arbuckle
