News From The Farming Market – March 2018

The number of TB-infected cattle slaughtered in Great Britain last year reached 43,590, an increase of 10% on 2016. The Government is to begin a review of its strategy this month as part of the plan to be disease free by 2038. The plan, covering all aspects of the control and eradication of the disease, began four years ago.

A recent report from the Sustainable Food Trust highlights the small number of abattoirs left in operation. Numbers have fallen from 1,900 in 1970 to just 249 currently with several small ones under threat. The large abattoirs are focused on moving the meat on to supermarkets rather than returning the carcasses to independent butchers for local sale.

Whilst confirming short-term subsidy support for farmers, Defra is consulting on proposals to move up to £150m of the direct subsidies into a new system to enhance the environment and improve sustainable food production. The money would come from a reduction in the subsidies paid to larger landowners. The CLA has expressed concern that its members may be unduly penalised.

The Government has announced that it will invest £90m in agricultural technology to boost the productivity of British farming. Over the last twenty years the increase in agricultural and horticultural productivity has lagged behind other countries, growing at one-third of the rate of the USA.

In the latest round of milk price cuts, Arla and First Milk have announced reductions to take effect from 1st March and with Muller reducing prices from 1st April. Dairy Crest has announced a cut to prices it pays for milk for cheese making. The processors cite the weakness of the wholesale markets where prices for butter and cream have fallen 30 – 35% in six months.

Discussions with Saudi Arabia have led to the lifting of a ban on the import of sheep meat from the UK. Exports are expected to begin shortly and be worth up to £25m over the next five years as it builds into a lucrative market for UK producers.

A €5bn investment programme is to be launched by France to transform its agricultural sector. Aims include attracting more younger farmers and increasing the share of organic farming to 15% to counter the €1bn trade deficit in organic goods. A clampdown on foreign investors buying land is also promised.

A near-total ban is expected on neonicotinoid pesticides after a further assessment by the European Food Safety Authority. It said that there was evidence of a high risk to bees from all outdoor uses of the chemicals. It is likely that use will be allowed in glasshouses. The UK originally opposed the ban but now supports it.

The Government has announced extensions to permitted development rights that allow farmers to convert and increase their farm buildings without full planning permission. There are also more options to convert buildings into family homes. Changes are also proposed to national planning rules that will provide for new houses to be built within existing farms. The changes have been welcomed by farming organisations as a boost to rural businesses.

Figures from the Scottish Government show that farm incomes rose, last year, for the first time in six years, to an average of £26,400, the same level as 2014. The figure is net of most costs with a favourable euro exchange rate and diversification being positive factors.

There is a severe shortage of straw in the UK leading to rising prices. Merchants say that the yield was down by one-third on the yearly average due to poor weather conditions at harvest with farmers opting to chop the straw rather than bale it. Demand from power stations also puts pressure on supplies as they consume almost one million tonnes.

The Government has formally launched a consultation paper on its proposals for replacing EU farming subsidies after Brexit. As already indicated the general thrust is a move to phase out direct payments based on the amount of land farmed. The CLA supports the move but, in a meeting with MPs, is again warning against dramatic cuts in subsidy support.

Defra is considering extending the badger cull to eight new counties making sixteen in all as part of the ongoing fight against bovine TB. The last cull resulted in in the deaths of over 19,000 badgers. Animal welfare groups remain critical of the scheme.

The late snow and continued wet weather has upset the usual spring schedule. In many areas the land is too wet to work leading to delays in drilling spring crops and applying fertiliser to autumn sown crops. The delays could result in a later harvest and lower yields.

Reproduced with kind permission from NIG FarmWeb