Online trading: farmers catching up fast

Latest Farmers Club Journal examines rapid growth of e-trading in agriculture

 e-trade picture

Yorkshire farmer and Farmers Club member, Andrew Loftus, detects the start of a quiet revolution in farming circles. 

The speed with which the internet has crept into every corner of our lives is hard to believe. The world’s first public website launched in 1992. That’s the year Major won the general election, Mansell won the British Grand Prix, the Maastrict Treaty was signed (just) and McSharry tried to sort out the CAP (it’s still a mess!). And it was before the internet really existed… 

By 2006 more than half of us used the internet every day, but there were still no smartphones. The first (Apple’s iphone) wasn’t launched until 29 June 2007, that’s two days after Gordon Brown became Prime Minister… let me say that again: When Gordon Brown became PM none of us had a smartphone! Today over 82% of Britons have one – more than any other country. 

Everywhere we look the internet is transforming the way we do business, and making markets more efficient and transparent.  If we want to look for a new vehicle our first port of call is the Autotrader app. For a new property it’s Rightmove. For a flight it’s Skyscanner. For somewhere to stay it’s AirBnB. And for just about everything else it’s Amazon or Ebay. 

But is farming being left behind? And how can farmers use the immense reach of the internet to get a better price? 

Registered to trade 

Thankfully, the answer to the first question is a resounding ‘no’. Take for example two internet trading platforms that I am involved with: sellmylivestock.co.uk and graindex.com. Neither site is more than two years old, but already more than 5,000 British farmers and livestock/cereal businesses are registered to trade. 

Both sites are run by a team of forward thinking, committed and entrepreneurial farmers and web developers, with technology that is improving all the time. For example, both sites will soon offer a guaranteed payment system, to take away the credit risk of dealing with unknown third parties. 

Sellmylivestock works by combining some of the best features of familiar websites like Autotrader, Rightmove and Ebay.  On any given day you’ll find around 3,500 head of livestock listed for sale, both by individual farmers and livestock trading businesses, just as you might find cars listed on Autotrader from both dealerships and individuals. 

The basic service is free to use, though sellers can opt into extra chargeable features. Also, like Ebay, buyers and sellers can build up their online reputation through a star-rating system. Those with 10 stars guard them jealously; they help their stock make a better price. 

The way farmers market their stock is changing. More store cattle and sheep are moving direct from farm to farm, usually through the efforts of an experienced agent or ‘auctioneer’, but not actually passing through the auction ring. 

50% direct trade 

Some estimates now put this direct trade at more than 50%. The internet is accelerating this change. Let me give you an example, one Friday in March, a well-known agent listed a batch of 20 Limousin steers on Sellmylivestock. By 9am Monday morning over 4,400 potential buyers had clicked through to that particular advert. It’s a powerful way of reaching so many potential customers. 

Graindex works in a similar way, allowing individual cereal growers to reach new customers.  Producers enter lots of wheat, barley or rapeseed into one of two daily trading periods. Already some of the UK’s largest merchants are regular buyers, including Openfield, Glencore and Nidera. 

Two facts are worth noting in particular: the average spread between highest and lowest wheat bids on any given lot is £4.50/t. And the highest bidder is rarely the same, demonstrating the value of an open and transparent market. 

The power of the internet is awesome. It’s great to see that more and more farmers are realising its potential and joining this quiet revolution. 

Farmers Club On-line

On-line links to The Farmers Club are a boon, says John Jaques, immediate past-chairman of the Under 30s. “As soon as I joined I registered with the website and have fully reaped the benefits ever since. It is updated nearly daily with reviews of the restaurant, operational updates (appointments and refurbishments) and nearly instant reviews of Club events. It is modern and full of information to explore, from the convenience of wherever you have a few minutes spare. Booking rooms, buying gifts or reading Club news – it's at your fingertips, with links to our very active Facebook and Twitter sites, key mediums for the future and ideal for promoting the Club’s great work. It's not all about selfies and the World moving faster – it's about helping you, as a valued member of the Club, to be informed, included and represented. Enjoy!”