UOM Annual Profits Climb 34% and Record Profit Share

Posted: 5 Nov

United Oilseeds Sees Annual Profits Climb 34%
& Announces All-Time Record Profit Share

Break crop specialist and independent farmers’ co-operative United Oilseeds has announced a rise in pre-tax profits to £1,511,249 for the trading year to end June 2021, up 34 % on its £1,124,090 profit during the same period the previous year.

The farmer-owned co-operative also announced a record profits redistribution payment to its trading members of £440,000, at a press conference in Newbury, today (4th November 2021). This is the highest profits redistribution payment United Oilseeds has ever paid to its members and is 38% higher than the previous year.

The co-operative’s annual turnover was also up, rising by 21 % to £171,973,546 from £142,522,102 the previous year, whilst its net worth rose 11 % to £13,553,754.

“Over a 12-month trading period which featured the smallest rapeseed area ever planted in the UK, significant economic effects from the covid pandemic and the UK’s exit from the European Union, United Oilseeds has delivered an outstanding performance with the help and support of its farmer members and staff,” said Chris Baldwin, Managing Director at United Oilseeds.

“We are pleased to be able to announce the record profit share to our farmer members at a time when they are facing huge challenges from increased input costs, labour shortages and economic uncertainty. In the last 15 years, our co-operative has paid back a total of £5.35m to it trading members.”

United Oilseeds’ strong financial performance is reflected by an increase in market share of the UK rapeseed certified seed market - and its share of UK rapeseed crop trading – which have both risen to 30 per cent.

Mr Baldwin went on to highlight some of the reasons why oilseed rape plantings will increase and why farmers should continue to include the crop in their rotation.

“Oilseed rape market prices are high and are likely to remain so.  At one point this year, the price even briefly touched 700 euros per tonne on the Matif futures market (equivalent to £593.22 per tonne). These higher prices have certainly helped encourage farmers to grow OSR again, but it is always important to remember that one of the OSR market’s traditional characteristics is volatility.

“Reports from around the regions so far indicate that this year’s OSR crop is doing very well with good establishment - particularly early drilled rapeseed - which will also help encourage growers to grow OSR,” he continued.

“Another positive factor for oilseed rape is the 41 % increase in winter barley planting this autumn. Winter Barley is a good early entry for oilseed rape and its area has increased by 128,000 ha, from 312,000 ha last year to 440,000 ha in 2021. Growers favouring early drilling will also find a plentiful supply of over-yeared OSR seed available.”

Mr Baldwin said over the next few years growers will also have an increasing list of ever-improving OSR varieties from which to choose, including ones with more stacked traits and the introduction of new “seventh generation” varieties which have many agronomic benefits. Growers also have the opportunity to reduce their risk with United Oilseeds “Produce of Area” contracts, which have no penalties should a grower’s crop fall short of the contracted tonnage, plus the increasing availability of seed breeder’s risk share establishment schemes.

“Growers can further mitigate their risk by selling their crops through marketing pools to shelter against dramatic price swings. For example, our Carte Blanche Pool is likely to deliver an average ex farm price of above £550 per tonne plus quality bonuses for its pool members, which is a very impressive result,” said Mr Baldwin.

UK Oilseed Rape Area and Production

United Oilseeds calculates that the UK’s 2021 rapeseed harvested area was 279,099 ha following an estimated crop loss of 5 per cent. For 2022, the expected rapeseed harvested area will be 366,797 ha, assuming another 5% loss on this autumn’s drilling area of 386,102 ha.

“After many years of decline, the UK’s drilled rapeseed area has now begun to increase and we believe it is a trend that will continue. By 2023, we predict the harvested area will reach 450,000 ha, which would be a 23% rise on 2022.” says Mr Baldwin.

United Oilseeds estimates the average UK yield for harvest 2021 was 3.20 tonnes per hectare from a total crop size of 279,099 hectares, resulting in an overall production figure of 893,116 tonnes. This means the UK is short of its annual 1,900,000 tonne requirement by 1,006,884 tonnes and this amount will need to be imported.  However, by 2023, the shortfall is likely to reduce to 460,00 tonnes.

Seed Market Trends

Compared to 2020, plantings of conventional certified rapeseed varieties by area increased by 16.1% this autumn, whilst hybrid plantings grew by 53.8%.  It is worth noting that the area planted for the specialist HEAR and HOLL rapeseed markets grew by 39.8% and 39.0 % respectively, whilst the area drilled with Clearfield varieties grew by 3.3%.

“This increase in the hybrid and conventional OSR markets has meant that United Oilseeds generated a 53% increase in overall bag sales this autumn.  This is also partly due to the popularity of two key varieties, Acacia and Aurelia.

Acacia now accounts for 40 % of the UK’s conventional rapeseed market and 11 % of the overall UK certified OSR seed market. Aurelia has an 18 % share of the UK hybrid market and a 13 % share of the total UK certified rapeseed market.

“It is clear that oilseed rape has now ‘turned the corner’ and we can expect to see plantings continue to increase over the next few years with new and improved varieties coming on to the market. This is good news for growers and good news for the future of rapeseed cropping” said Mr Baldwin.

 

-Ends-

Note to Editors

United Oilseeds is one of Britain’s foremost national agricultural co-operatives. Owned entirely by its 4,500 farmer members, it is the UK’s only oilseed rape marketing specialist. In addition to OSR, it also trades linseed, oats and pulses and is the parent company of the expanding small seed specialist, Hubbards Seeds, which sells environmental crops, maize and grass.                                                                                         

 

For further media information:                                            Issue Date: 4th November 2021

 

Edward Meadows

United Oilseeds

Tel: 01380 729200      

M: 07500 224 137      

E: edwardm@unitedoilseeds.co.uk