Although no financial figures are yet to hand and it will be some time before they are available, the cereal sector, including farmers, fellow merchants, hauliers and other in the service industries are already bracing themselves for a major deficit.
Speaking this week to more than 100 cereal producers and others caught up in the administration of the long established family firm, NFUS vice president, Andrew Connon said that not only was there significantly less grain than stated in the five main stores operated by the company, there were also more claims on the grain that is held in store.
With the grain having lost identity, the administrators are now asking for legal permission to sell all off the grain held, with the proceeds being distributed to the creditors.
Connon added that the five sites operated by the firm in the east of Scotland and north east of England were also in the early stages of being marketed as the administrators sought to liquidate the assets.
While having nothing to do directly with the administration, Willie Thomson, the chair of the NFUS combinable crops committee, pointed out that the potential loss of these stores with their 200,000 tonne capacity for the coming harvest could add to further problems for the sector.
Most of the concerns raised by those attending the meeting related to the ownership or otherwise of contracts entered into by farmers. Shirley Li-Ting, an insolvency expert with Brodies, said the administration process was complex.
“It takes time to assess the position as well as providing an estimate on the various claims.
"Administrations often take more than a year to complete”, she commented.
Making the situation more complicated, she said there seemed to be a variety of contracts and it depended on the wording.
The company did not belong to the umbrella organisation, the Agricultural Industries Confederation and therefore the standard trade contract did not apply.
Another issue making the administration more difficult is the number of ‘barter deals’ where the farmer has bought seed and fertiliser from the firm linked to an agreement to supply the harvested grain later in the year.
It was suggested these could be seen as separate deals with the grower potentially losing out twice or they could be conjoined.
Many of those attending the virtual meeting did so under the cloak of anonymity.
Ms Li-Ting said that she had noticed these moves but had no information of any wrong-doing and claimants should take comfort from the responsibilities invested in the administrators who had a duty to look at the actions of the directors.