Scotland’s largest independent grain merchant – W.N. Lindsay – has warned profits could be hit this year as a result of falling grain prices.
In accounts filed with Companies House, the company’s secretaries said: “Global grain prices have fallen significantly in the past few months and we consider that this will have an adverse effect on our profitability.
“However the record yields in the Scottish grain harvest may offset the impact of the reduction in our profit margins.”
Final estimates released by the Scottish Government last month reveal the extent of last year’s bumper harvest.
Scotland’s chief statistician put the final tonnage at 3.2million tonnes, up 384,000 tonnes on last year and the largest in 20 years.
This was a result of a 13% increase in overall cereal yields, which averaged 2.83 tonnes per acre and ranged from 2.46 tonnes per acre for spring barley and oats to 3.68 tonnes per acre for wheat.
W.N. Lindsay’s accounts, which cover the year ended May 31, 2014, reveal a drop in both turnover and pre-tax profits.
Sales were down £663,023 to £114.119million, while pre-tax profits fell nearly 10% to £2.405million, from £2.663million the year before.
The accounts also reveal that the highest-paid director took home a pay cheque of £181,498, representing a 20% pay rise from the year before when they were paid £150,770.
The firm’s managing director, Andrew Stephen, said it was too early to tell to what extent the falling grain prices would hit profits this year.
“When grain prices come down it does have an effect on our margins but I would say that our saviour for the 2014 crop is that it is very big,” he told the Press and Journal.
W.N. Lindsay, which employed 47 people in the year, has grain storage sites at Keith in Moray, Stracathro and Forfar in Angus, and Gladsmuir in East Lothian.
It works to supply grain to whisky giants Chivas and Diageo as well as porridge company Quaker.