Norfolk boost for milling wheat with Warburtons

By MICHAEL POLLITT

Agricultural editor

Milling wheat growers in East Anglia are set to reap a return from one of the country's longest supply contracts with a leading national bakery.

Warburtons has signed a five-year extension to take home-grown wheat for another five years to 2016 in a contract worth about �132m.

Openfield's Graham Lacey, who is commercial director, said that more than one million tonnes of contracted wheat has been delivered to produce flour for Warburton's. The contract, which is now in its 12th year, has already been worth �172m to wheat growers.

'It is this type of long-term commitment that sets our relationship with Warburtons apart. Many farmers have been committed to producing Warburtons wheat since the contract began; this helped them achieve some exceptional returns from their wheat,' said Mr Lacey.

'East Anglian production has increased a lot during the contract. It gives a degree of certainty and a fair return over the life of the contract,' he added.

Warburtons used about 50pc of home-grown wheat with the balance from Canada. 'We've always viewed this as a bit of a partnership really, the home-grown wheat compliments the Canadian and so produces a very good loaf.

While Hovis has set out to produce a 100pc British loaf, Warburton's has refused to compromise on quality and thus included an element of imported hard wheat, said Mr Lacey.

'We manage supply the supply to the participating mills depending on whether they want higher or lower proteins at different times.'

Mr Lacey said that the contract, now set to run for 18 years, has helped Warburtons to produce consistently high quality and become the market-leading brand on the supermarket shelf.

'The contract is, however, about far more than just volume as we've worked together to ensure that not only fair prices have been paid to growers each year but that as much as possible of the contracted wheat can be used even during more difficult harvests.

'The real test is how much our growers receive for their grain each year - not just a headline price. One of the key elements was the pool price and secondly, was some kind of cost+ plus contract with grain,' he added.

Bob Beard, who is the independent family's bakery's group purchasing director, said: 'Top quality milling wheat and traceability are at the heart of both our bread making process and British farming. We produce 15 million units per week - from crumpets and rolls to large loaves.

'Openfield members, who contract the wheat, have consistently risen to the challenge of producing the increased quantities that Warburton's have required,' added Mr Beard.

Mr Lacey said that Openfield could demonstrate complete provenance because the seed crops are grown before the wheat is planted.

'When the price is very low, we have minimum price contracts and in the last couple of years when the quality has been very variable, it has worked to helped growers.

'We reckon that more than 90pc of the Warburton contracted wheat gets delivered every year. This is way higher than the national average for milling wheat.

'It is because the growers are good at it and also because the technology exists in the mill to use lower Hagbergs,' said Mr Lacey.

By the end of the 2016 harvest, it could be worth about �330m over the life of the contract.

Mr Lacey said that a new farmers' forum, involving 15 growers, has been started to explore more non-commercial ways of working even more closely together.