The Future of Grain Marketing: panel discussion
How much value could better grain marketing add to your bottom line? At Cereals this year, we brought together a panel of experienced farmers and grain marketers to discuss one of the most important – and often overlooked – aspects of farm profitability.
We’re delighted to share a film of the full discussion as part of our Ask An Expert series, featuring:
James Peck, Managing Director of PX Farms
Ryan McCormack, Dennington Hall Farms, Farmers Weekly’s Farm Manager of the Year 2025
Andrew Huxham, Up Marden Farms, co-founder of Hectare Trading
Lizzie Blower, Head of Trading at Hectare Trading
The panel agreed on the importance of removing emotion from decision-making, and how a disciplined plan with selling little and often can significantly improve average returns.
The panel shares their advice and experience over a range of key questions:
Is grain marketing undervalued – and what difference can it make? How much can you improve your profit margins through good grain marketing?
How do you manage grain marketing in a volatile market? What strategies do you use?
What tools do you use for grain marketing? How do you track your baseline and set your target prices? How do you measure your progress?
How important is it to invest in technology to improve your grain marketing and to understand better your own cost of production?
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This article is for general information only and does not constitute advice. While we make every effort to ensure the accuracy of the content at the time of publication, Hectare Trading makes no guarantee regarding the data provided.
Transcript
Lizzie Blower
To get things started, we are going to be looking at, how is grain marketing undervalued? We obviously spend a lot of time looking at cutting costs of production, but how much value can grain marketing add to it? So, who wants to start?
Andrew Huxham
I’ll have a stab at that. Thank you, Lizzie. I don’t think, it’s not that it’s undervalued, it is undervalued, but it’s also overlooked, isn’t it? And I think there is so much emphasis on the production side of what we do, because that’s where people can extract value from us, and very little on actually how we sell what we have produced. But the impact it can have can obviously be absolutely huge. You know, the difference between good grain marketing and bad grain marketing, if we just take, for me, harvest 25: I think the difference between the high and the low of my milling wheat contracts is 60 quid, and if you’re producing a couple of thousand tonnes, that makes a huge difference. If you can get your average sale price up into the top quartile, you’re going to be doing a bit better. So, it is undervalued, it is overlooked, and I think the impact is huge. Have you got anything you want to add, James?
James Peck
Good morning, everybody. Very nice to see you all here. So, grain marketing for our business. We’ve got 27 landlords, so we’ve got a responsibility to be involved in grain marketing for them, in terms of delivering back for contract farming, or whether it’s just for ourselves with paying FBTs, etc. I would think, over my career of 25 years, I’ve had some real highs and lows of grain marketing, and I think that how do you benchmark yourself would be the first question. Actually, have you done a good job or not? The only way you can really do that is to probably compare yourself against, say, different funds which are out there, ADM or Frontier or whatever, and what they’ve done, and look at yourself in comparison to that.
I've obviously had times when I’ve sold at near the top of the market, but I’ve equally had times I sold at the bottom. I remember my worst deal I’ve done in my career was in my very early days when my father first let me have a go at grain marketing back when I came into farming in 1999 and I sold pretty much the whole lot at about £65 a tonne for the wheat. Then I had a meeting with someone to look at doing options, they said don’t bother. And the market at that time went up to £90 a tonne, so that was a bit of a sore time. So, since then, I’ve put a lot more focus on how I do the grain marketing, going forward, and also taking into account the people I farm for and how they want the marketing done. Some obviously have different objectives, they want all the cash in some by the end of Christmas, depending on what their objectives are. That’s changed tremendously now we’ve lost BPS in terms of how do we get money into the business and being able to fund inputs and FBT rents.
Ryan McCormack
And I suppose I would say that on an arable farm today, grain marketing and grain sales is probably your only income, or your major income, at least. You know, we’ve lost all support anyway, so we have to get the marketing right. Andrew, you talked about £50, £60 a tonne and what that means to the bottom line, but we have to remember that we’re producing eight, nine, 10 tonnes of wheat, you know, that could equal £500, £600 a hectare, and actually, when you take that into consideration, that’s quite a lot, that’s nearly the input cost of growing the crops, so it’s really important to look at it. Yes, it might only be £20, £30, but you times that by the yield, that gives you your return per hectare. So you can increase your profit margin – or at least make, hopefully, some profit – by marketing right. So yes, for me, grain marketing is very important and undervalued.
Lizzie Blower
Thinking about the volatility of the market that we’ve seen over the last year, what would you put in place, or how do you work around a volatile market like that? In considering your grain marketing, is it a long-term strategy of little and often? Are you using pools? Are you offsetting it some way? How would you go about that grain marketing you’re talking about?
James Peck
It depends whether your grain marketing is emotional – sometimes your decisions can be emotionally based – or whether actually you go with the little and often. I think I’ve had many conversations around the boardroom, and what people’s preferred method of grain selling is, and sometimes that can change per year, and also depending on the make-up of that boardroom. Sometimes it can be difficult but people, in hindsight, are very good sellers and will criticise the process you’ve done. But my grandfather, for example, he was very keen on little and often. This year we have probably only sold about as little as 5% and typically in previous years by this time we’d have sold at least 30%. And there have been outside influences. I am feeling fairly optimistic and, as a group of farmers in this room, I want you all to tell everybody that the yield is going to be awful, because I want the price to go up. I think we need to do that internationally. I think that would be the best thing we could all do, but I’ve got a gut feel – I might be wrong – but I think the prices are going to go up.
Ryan McCormack
For myself, I do analyse every input, whether that be the machinery, the costs, everything. I know roughly my budget, cost of production, so that gives me an idea of where I would like to achieve a line in the sand and achieve above that. Obviously, we’re talking about a global commodity and that doesn’t always work but, at least, if you know your cost of production, you know where you’re going to aim for, then you can market a bit of little and often if you see the price going up. I don’t sell on emotion, so I sell little and often. I’m quite strategic about how I sell it. I look at future markets. So we’re doing TMS pools, which is technical market solution pools. We’re also in standard pools. We’re using Hectare grain trading as well as a benchmarking tool. So basically, I try to benchmark myself, looking at futures, and keep increasing that average price. So I’m trying to sell on an upward market rather than what I would call panic-selling on a downward market. I try to take the emotion out of it and run it as a business and not let emotion get in the way.
Andrew Huxham
I think as farmers we need to try and understand why we’ve seen the increase in volatility. I mean, the volatility of the markets, for me, we haven’t seen a lot in the last 10 months, but if you go back over the last six years we’ve definitely seen an increase, haven’t we? And I think, as a farmer, I need to try and understand what’s influencing that. So, is it the supply-side factors, the demand-side factors, the macroeconomic factors? Because, once I understand what forces are acting on a market or may do in the future, I can begin to take the emotion out of my decision-making.
You both mentioned emotions, and that is part of the problem, I think, for a lot of farmers when it comes to grain marketing. We’ve spent, you know, 12 months nurturing a crop through rain, hail, drought, everything else, and it’s inevitable that you have a level of emotion involved with it. But we need to stop making impulsive, subjective decisions on grain marketing, and if we understand what factors are operating and we understand our own figures in terms of yields and costs of production, then we can start to put together a better plan and actually make it an objective decision-making process. So the emotional side of it is what, as professional farmers, I think we all strive to remove from grain marketing, isn’t it? But it’s interesting, that’s one of the things high up on my list, and you’ve both mentioned.
Lizzie Blower
I just want to highlight the slide behind you, about taking the emotion out of trading. If you look at this middle blue line, if you sold little and often all throughout the year, this year you’d have averaged £181. If you sold every single high, you would have got roughly another £2 on top of that, and then if you sold under emotion, when the markets are dropping, you could be sitting at that £173. So I think what you’re talking about makes a massive difference to your overlying profit on grain marketing.
So, thinking about that and moving on to the tools that you use – and don’t all jump and say Hectare! – but what else do you look at in terms of how you go about that marketing? Like, how you track your baseline, how you look at what you want in terms of your target price and how you’re going to reach that.
Ryan McCormack
I alluded to it in the last comment. We’re doing TMS pools. So I’m working with grain traders, trading on the futures, so we’ve put about 50%, 60% of our wheat into that, and then we’re looking at the future market and selling it on there, so I can build up my own pool, which gives me my baseline sale figure. When the spot price goes above that, I will then sell a couple of lumps, so that I can build my average up. And I’m using Hectare: so, we’ve done 1000 tonnes on Hectare last year, where we’ve placed it out, and we’ve done some of the market insights, and accepted anything that was above my baseline grain selling average at the minute.
I basically start with a figure through the futures, and I will try to achieve the average to keep going up and up and up. And I know that in 2025 my total cost of production, including overheads for the whole farm and the family, was £172 a tonne, so there were times when it was at that level, but you know, using the strategy that I’m using, we've achieved the £186 average last year on feed wheat. So basically, using different tools, knowing exactly what the costs of production are, having an idea of exactly where my average for grain sales is, so that I can always try and beat that, and taking the emotion out of it. If it goes above that, sell a little bit, so that the average keeps going up.
James Peck
We grow about between 2000 to 2200 hectares of milling wheat a year, and if you base it on 10 tonne a hectare, that’s over 20,000 tons. So a pound shift is a difference each time of £20,000, which is actually quite difficult when you’re sitting there seeing the market bobbing up and down. You realise that the numbers actually start to get quite substantial. We’ve found in recent times that our main concentration has been actually on yield, and secondly, then trying to get some kind of added premiums and benefits.
That’s why we grow the milling wheats, even though we might see a slight deduction in yield in terms of milling over feed. We’ve concentrated on additional Whitworth contracts or additional premiums, min-based premiums to try and flatten the extremes out. It’s the extremes, is where I think, you know, we don’t want to get caught. We, for example, might sell 3000, 4000 tonnes on the August market, so we’ll store it all the way through, and then hopefully get as much as £30 a tonne premium for doing that, which is actually for us a quite substantial amount of money. The other interesting thing we’ve noticed is that eight out of 10 times we’d be better to sell all of the crop over the weighbridge at harvest and effectively not pay to store it, but rent the space out in the stores and receive an income that way. It’s just, sadly, when you get the £100 shifts in the marketplace and you calculate what that money you’ve just missed is – which comes back to your “little and often” point that you’re referring to.
Andrew Huxham
And it’s interesting you allude to storage there because, for me, I think to a degree we’re all price takers, but if we can increase the when and the where that we’re price takers. So what I mean by that is, if you know your figures and you’re prepared to sell a bit forward if the price is right, or if you’ve invested in decent grain storage, or you partner with someone that’s got good grain storage and drying facilities, and you can hold it for longer, you can increase the length of time you have to try and achieve a price with a margin. So I think it’s really important, and at home we’ve invested in decent grain store and drying facilities, because I want to give myself the best chance of achieving a price with a margin.
So that’s the when and the where for me is: how do we get exposure in the market? How do we make sure at any given point in time we’re achieving the best price? And I suppose that’s one of the reasons I started Hectare Trading 10 years ago. So the two variables, the whens and the wheres – if we can stretch those out, we stand a better chance. The worst thing I think you can end up is being a farmer that doesn’t know his figures, isn’t prepared to sell forward and only has temporary storage. So you sell everything at harvest or in August or September, and then you only sell it all to one person, and suddenly you’ve got no when and no where, and that is the highest risk strategy you can have. And there will be years when it pays off, but over time I think you’re in trouble there. So that’s how I approach it.
Lizzie Blower
So we know the importance of spending money on technology to reduce costs in terms of production. How important do you think it is going forward to invest in technology to improve your grain marketing and to understand better your own cost of production, where you sit with it, your tracking, your rolling average and looking at your position in the market? Do you see them on equal par, or do you think it’s something that one should be above the other?
Andrew Huxham
I think it’s an interesting point, and you’ve already alluded to it, Ryan, and I have with increasing the when. We’ve got to understand the figures of average yields, but if you’ve got varying soil types, look at your average yields over 10 years and categorise them between different soil types, and then look at the yield variances between different crops. Because there are some crops I’m quite confident in selling 50% to 60% forward, and some I wouldn’t consider, like spring beans. So understanding the figures and then understanding your cost of production is key, because there’s no point selling forward if you haven’t got a margin, but knowing at what trigger… And all of this helps remove emotion, which we’ve talked about. So, for me, it’s all about understanding the figures before you even start.
Ryan McCormack
I think it would be very difficult to put a prediction tool into the grain marketing side of things. We don’t know what’s going to go on in the world. We don’t know how the fundamentals are going to move the market. I suppose there’s a little bit of AI starting to come, where trends are starting to be set, and we can look at that and timings and what month might be best to sell. But I think what Hectare has created has, you know, an open marketplace where you can put something out there with the provenance, which I think is going to be the future. I think we’ve all got different stories on our farm of how we’re producing these crops. Some people are doing it broad acres, some people are looking at reducing input, some are doing regenerative practices. I think the marketplace is just one marketplace at the minute, so I think having a bit of provenance behind it, where perhaps buyers are looking for something slightly different, that’s what I hope will be created, so that we can create different marketplaces for the same grain. Not just a commodity, it’s the provenance behind it.
James Peck
I would think about grain marketing, the sense of the greed factor, and if we were to pick a number today, and you said, “Oh, if I could get the base price of milling wheat at £250 today, I’d sell it all, and I’d look to sell multiple years ahead.” And the reality is, you get an up-market where it starts to get steam, and everybody talks about £300. You don’t sell it all at £250 as you’ve just talked about doing, and suddenly you end up selling it probably for £230. And I think I’ve had that quite a few times, and I’ve had a sort of stern word with myself in recent weeks about the fact that, if it does start to push on, I’m actually going to try and sell multiple years. Because actually, I think, as you rightly just alluded to, we could comfortably sell a minimum of probably 50% and the only difficulty we’d have in terms of milling wheat is whether you don’t reach spec. And then you’re having to buy into the marketplace because you can’t do it, but that’s of course where the cleaning facility comes in and blending to try and make that work.
Lizzie Blower
I’m actually always amazed at the optimism of every single farmer when the market goes up and they’re like, no, no, I’ll just wait till tomorrow. So lastly, just a quick piece of advice, what would be your main piece of advice for anyone going forward, thinking about how they are marketing their grain and the future of it and the technology that’s available to them?
Andrew Huxham
I suppose for me it’s: understand the influences on the market – think about where you’re getting your information from for that. Understand the figures. And if you do both of those things, hopefully in doing that, you’ll remove the emotion, because we all need to take the emotion out of it. It should be a measured, objective decision-making process when we choose to sell something. Having said that, every time I make a sale, I make a note next to that contract as to why I made that decision at that point. So that, if I regret it in the future, I’ve got something to fall back on for my own sanity.
James Peck
Cash flow. I think that cash flow is so very important. You need to know exactly where your pinch points are going to be. And, regardless of where your cost of growing is, actually the reality is, at some point you’ll probably end up selling some of that crop below the cost of the thing, but you’re going to have to do it for cash flow. So that would be my first point. The second thing I would say is, depending upon who the partners in your farming structure are, make sure that you’ve got an agreement between all of you of the timings and the amounts you’re going to sell at, so that you’re all on that journey.
Ryan McCormack
I’m going to be the black sheep. Actually, I think the current farming industry is at an all-time low. I think confidence is at an all-time low. I’d be careful about who you’re selling to and not be putting all your eggs in one basket, because there can be horror stories where grain has gone off-farm and money doesn’t come back. So, I’d just be really careful about who you’re selling to and the quantities that you’re selling to, and probably not put all your eggs in one basket, would be my advice moving forward. It’s a bit of a doom and gloom answer!
James Peck
We don’t want negativity, Ryan!
Andrew Huxham
We’re eternally optimistic gamblers, or we wouldn’t be doing this!
Lizzie Blower
And I would be slightly remiss if I didn’t just highlight Hectare. So, obviously, Hectare is a grain-trading platform, and what we are trying to do is open up the market for farmers to use this to take advantage of not being a price taker. Looking at gaps in the market, where it comes from, not just your national merchants, but with 50% end users, you’ve got people like Pilgrims and Whitworths and Morning Foods, who are also buying direct from farmers and interested in dealing directly with farmers. And then tracking your position as well – so the tools that are available on there are key to what we’re talking about today.
Thank you very much, all of you, for your advice.