Ipswich-based grain, seed and fertiliser merchants Nidera UK have reported improved operating results for the year ending 31st December 2016.
Earnings before interest, tax, depreciation and amortisation were £1.7 million while tangible net worth has risen by £1.3 million to £12.7 million. Turnover was £324 million compared to £289 million the previous year.
According to managing director Mark Dordery the UK group, which comprises Nidera UK, the Ipswich Grain Terminal, Suffolk-based Grainseed, and Barmby Moor Holdings in Yorkshire, continues to grow on the back of significant investment in the sector.
“This is an acceptable performance given the challenges that agriculture currently faces both at a local level and globally.
“Furthermore, we have again achieved record sales volumes in our core products of grain, seed and crop nutrition.”
In recent years Nidera has acquired Eye-based seed specialists Grainseed Ltd and the grain trading arm of Liverpool-based Criddle and Company Ltd, he points out.
“We have also continued to make significant capital investment in fixed assets, including new land and warehouses at Langton Green, Suffolk.”
A key factor in the company’s success has been its management of the increased price volatility resulting from the EU referendum, he says.
“The biggest impact of Brexit so far has been the devaluation of Sterling which has contributed to a sharp rise in grain prices since the referendum and this has been a two-edged sword.
“The jump in grain prices has helped to improve incomes for arable farmers, which is good news for everyone associated with the sector, but it may have caused problems for any trading companies that were caught unawares.”
In fact, the last year has seen a number of high profile bankruptcies in UK agriculture, including turkey producer Bernard Matthews and Cambridgeshire-based merchant Wellgrain, he points out.
“It is more important than ever for farmers to be confident in the financial standing of the businesses with which they trade.”
Nidera is wholly owned by China’s Cofco International which is part of the major international trading company and agri-food business Cofco Corporation – a Fortune Global 500 company with total assets in excess of $70 billion.
The company also has a number of other shareholders including the Singapore sovereign wealth fund Temasek, The International Finance Corporation – a branch of The World Bank – and the UK’s Standard Chartered Bank.
Over the coming weeks, Nidera will be carrying out a worldwide re-brand under the Cofco name, Mark Dordery says.
“In the UK, for example, our fleet of 35 HGVs will retain their distinctive blue colours but will carry the Cofco name and logo.
“Although the name will be changing, our commitment to our customers remains the same and the substantial investment our new shareholders are making shows real confidence in the UK industry moving forward.
“Our recent growth and exciting plans for the future mean customers can be assured we are better placed than ever to provide competitive products and services to help them grow their businesses successfully in the years ahead.”