FARMERS SHOULD budget for inflationary rises in the cost of crop protection products during 2010, according to AtlasFram Group, the UK’s largest farmer-owned farm inputs purchasing and crop marketing business.

“Manufacturers of crop protection products are now releasing recommended prices for the season ahead,” said John Humphreys, of the group. “Our view is that, generally, these will show an inflationary increase compared with 2009 levels but, as always, the devil is in the detail.

Very few active ingredients are now produced in the UK, which means that prices of finished products are at the behest of currency rates and global market conditions.

“Because sterling has not strengthened in value against the euro to the level which some might have hoped for, prices of product manufactured in Europe are coming under pressure and can be expected to increase by at least the rate of inflation.

“Compounding the effects of exchange rates fluctuations are a range of other global factors. The main one is China’s economy, which is expanding at record levels of 7% to 10% annually, creating greater demand from within the country and pushing up the prices of some active ingredients produced in the Far East.

“One of key issues for farmers this year will be timing their purchases of crop protection products to obtain the best value, but the difficulty for any individual business is deciding at what point to commit.”