The need to help farmers gain a better understanding of the commodity cycle and its impact on agricultural business strategy was identified as a priority issue during this week’s launch of AHDB’s volatility forum.
The forum is a new AHDB initiative which is designed to help producers tackle volatility in relation to farm commodities, with the launch in London drawing farmers, processors, retailers and trade associations together to seek “practical solutions” for businesses affected by market uncertainty across agricultural supply chains.
Chaired by AHDB Dairy’s Gwyn Jones, the launch meeting was addressed by the Andersons Centre’s Graham Redman, HSBC’s Allan Wilkinson and AHDB lead analyst, Jack Watts.
“There is unlikely to be a one-size-fits-all solution to managing volatility and it certainly won’t happen overnight,” said Mr Watts (pictured above). “Commodities markets are both highly complex and delicately balanced as we have seen to some extremes across agricultural sectors in recent times.
“Like the markets, interest in volatility management has been cyclical. In times of high prices, businesses tend to be in a better position to weather market impacts and the level of interest wanes as a result.”
When asked to name their top concerns for 2016, forum members identified “helping the industry better understand the commodity cycle and its impact on agricultural business strategy” as their top priority, followed by “the need to upskill the industry in its approach to assessing risk likelihoods, impacts and prioritisation”.
The launch of the forum coincides with the inauguration of the European Commission’s Agricultural Markets Task Force, which is due to report in the autumn on policy and legislative initiatives to improve farmers’ position in the supply chain. Part of the forum’s remit will be to apply practical considerations to any recommendations arising from the task force initiative.