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High cereals prices and strong trading positions led to a huge jump in profits at Dewing Grain in the year to 30 June 2022.
The Norfolk-based merchant achieved a pre-tax profit of £1.09m, up from £275,000 during the previous financial year.
Turnover was up by 28% on the year to total £45.27m. However, this large increase in turnover was almost entirely offset by a 25% increase in the cost of sales, which totaled £42.74m.
See also: Fickle UK wheat prices bear the brunt of volatile global markets
The invasion of Ukraine by Russia had a dramatic and immediate impact on all agricultural businesses, according to the directors’ report, with cereals prices and related products increasing beyond any historic levels, and outside the experience of any trader.
Fluctuating grain prices was noted as a principal risk for Dewing Grain due to changing global grain market conditions and weather, however, the business uses futures markets to counteract some of the risk.
Future outlook
Dewing Grain chief executive Andrew Dewing said: “The immediate future for our industry is one of extreme volatility and lack of supply, before we suffer any major drought, storm, or flood.
“Our business is sufficiently small to correct our market position quickly and we have a strong enough balance sheet to give our growers confidence in trading with us.”
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