The question on the heading above is not a suggestion that you should be selling your grain, rather a reminder that if you do not know how much it is costing you to produce, then you are not ready to sell your grain.

At present, farmers are looking at prices of over €210/t for feed barley and €220/t for feed wheat. These are among record prices paid for grain in Ireland, of course alongside input prices which are also at record levels and pesticide costs which have risen again this season.

In 2022, the harvest price accounted for these price rises and let’s remember some farmers had bought CAN fertiliser the previous autumn at prices of €400/t and under, so as grain prices increased the risk reduced.

ADVERTISEMENT

For those with grain in store since the 2022 harvest, risk is increasing and the opportunity to sell at peak record levels passed, but some may have availed of these prices in the previous May and prices available at present are still among records.

Risk

With all methods of selling there is risk. Harvest was traditionally one of the lowest prices of the year, aside from in recent times which have seen many farmers avail of high prices at harvest time.

Selling a little bit of grain forward throughout the year is another way of reducing risk and some choose to dry and store to try and reduce risk or avail of opportunities. In any given year one system of selling can be better than the other.

Whatever way you are selling your grain, you must know how much it is costing you to produce and what price you are happy to sell at in order to make a profit.

You need to have a mark and be able to say I can make X amount of profit at a price of €212/t for example and when I am offered this price I am happy or not happy to sell some of that grain.

Earlier in the spring we published the Teagasc Crop Costs and Returns.

These figures give you a good guide on how to calculate your costs, but you need to input your own figures. You then need to estimate the crop yield and be slightly pessimistic on this to make sure you are covering your costs.

Consider the weather which has passed. For example, winter crops are not the best they have been on many farms. Also consider the weather to come. Spring crops have gone in later, many are not yet planted and this may reduce yield.

Spring feed barley

Figures this year from Teagasc estimate the cost of producing spring feed barley at €1,589/ha (€600/ac). At these costs and a price for grain of €240/t a farmer needs a yield of 6.9t/ha (2.8t/ac) to break even.

At a price of €212/t the farmer needs a break even yield of 7.5t/ha (3t/ac). If you bring the price of CAN+S down from €800/t in those figures to €550/t (levels available in recent weeks when N was being purchased by some) then that takes €155/t off the costs, bringing it to €1,434/ha (€580/ac) and making the breakeven yield 6.8t/ha (2.7t/ac).

Of course, many farmers purchased fertiliser at high prices to secure supply last autumn and winter.

Put this another way, if yield falls to 6t/ha (2.4t/ac) your grain price needs to be €239/t.

At the minute, that’s a depressing thought, but your costs are most likely lower than Teagasc where you are doing your own work and own your machinery.

So what do you need to be paid to be happy to sell? Sit down and calculate your costs.