What does FC Stone do?

FC Stone is a global grain price risk management company that protects its clients from rising or falling market prices using futures markets and a form of price insurance called options. In our Dublin office, we serve clients across the EU in the grains, oilseeds, feed ingredient, dairy and energy markets. In my role, I work mostly in the grains markets so our clients are a mix of feed compounders, flour millers, biofuel producers and grain traders.

Do you work directly with farmers?

That’s a yes/no answer. Strictly speaking we do work directly with farmers but they are currently very large corporate farms in eastern Europe farming 20,000ha or more. More generally we do not work directly with farmers one-to-one but we work with quite a few co-ops in continental Europe and specific farmer hedging programmes. We also run risk management programmes where co-ops form a pool for growers to place their grain ahead of harvest and we manage the grain price risk management for them.

How are grain markets in 2019?

Grain markets are unique, challenging and interesting this year. This is the first time since 1995 that the market is trying to assess the damage caused by a wet spring planting campaign in the US. The market is trying to balance the anticipated recovery in global wheat and barley supply against the US maize (corn) production losses, which are potentially as high as the entire EU maize crop. African swine fever (ASF) is also having a negative impact on demand in Asia.

Should Irish farmers engage in forward selling?

From a statistical standpoint, farmers who forward-sell get higher prices than when they only sell at harvest. At the moment, selling forward is done at a flat price and you are locked in from that point forward. However, more and more farmers across Europe are using price insurance to guarantee a minimum price while still allowing them to benefit from higher prices if the market rises. We provide access to these tools to individual farmers through their co-op or merchant. Because prices are very mid-range currently, it’s a perfect year for such a strategy. The important thing is to have a market plan that works up from your cost base.

What are the early indications for harvest grain prices in 2019?

It’s a little too early to call prices as the extent of the problems with the US corn crop won’t be known for months. Aside from that, the impact of ASF in Asia, near record grain production in South America and a recovery of wheat supply in Russia are having negative impacts on market sentiment. Put it this way, on our farm we are 30% with a mix of fixed and floor prices and are comfortable now to wait and see.