Category Archives: EU

Butter price rise: falling milk production, rising demand, adverse weather, liberalisation – low prices are still the elephant in the room

As salaried workers in the commercial media, futures markets and organisations including the NFU, AHDB, DEFRA, DairyUK and RABDF pontificate about the situation, it is good to see that the ignored elephant in the room is slipping in to the columns of the Financial Times.

Emiko Terazono, commodities correspondent, reports that many dairy farms in Europe and Brazil have endured years of ‘sluggish’ (aka low) dairy prices and quotes Kevin Bellamy (Rabobank): “Many dairy farms in Europe and Brazil are suffering from a shortage of young cows to bring into the herd after the years of sluggish dairy prices. Because of the period of prolonged low prices the young stock aren’t there”.

She refers to the EU’s move to liberalise its dairy market in 2015, lifting restrictions on production and exports, which caused prices for fall by more than half between 2014 and 2015, with many dairy farmers around the world going out of business or struggling under increased debts. The EU then responded by introducing voluntary output cuts and compensated farmers for not producing milk. World milk supplies from leading five producer regions slipped 0.4% in 2016.

January protests outside the EU Council building covered here. Above, see the European Milk Board’s Faironika, the artificial cow canvassing for fair payment for dairy farmers and explaining the nutritional value of milk, the role of farmers and their value to the rural economy

During the protests in January, Sieta van Keimpema, dairy farmer and vice-president of the European Milk Board, the lobby group representing the region’s producers, “Milk producers all over Europe are still in the throes of the crisis . . . and although the milk price has rebounded from last year’s lows, it is still lower than the cost of production”.

 

 

 

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Seeking food supplies from Turkey and Morocco?  Time for change!

On BBC Radio 4 today it was reported that some supermarkets are limiting sales of fruit and vegetables.

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A newspaper elaborates: “Morrisons and Tesco have limited the amount of lettuce and broccoli after flooding and snow hit farms in Spain. Shortages of other household favourites – including cauliflower, cucumbers, courgettes, oranges, peppers and tomatoes – are also expected. Prices of some veg has rocketed 40% due to the freak weather. Sainsburys admitted weather has also affected its stocks”.

HortiDaily reports on frost in Europe in detail (one of many pictures below) and the search for supplies from Turkey, Morocco, Tunisia.

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A former Greenpeace Economist foresees these and more persistent problems in his latest book, Progressive Protectionism.

Colin Hines reminds us that in 2014 the UK supplied just over half (54%) of its food supply. The EU was by far the next largest supplier at 27%. It is clear that we depend on Europe to keep ourselves fed. He adds:

“At present the UK can only feed around 60% of its present population of 65 million, let alone the around 8 million extra projected in the next 15 years. The UK’s food vulnerability could worsen for a number of reasons. The global availability of the food supplies that the UK at present imports could be dramatically reduced, due to rapidly rising global demand, particularly from Asia; or increased domestic demand from the countries that we at present import from; or if we are unable to afford whatever the global prices might rise to”.

And, presciently, “the threat to UK food security could be more serious should increased global demand combine with other potential problems such as climate change”.

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A 2013 report from the UK government’s official climate change advisers warned that droughts could devastate food production in England by the 2020s. Hines advises: “The answer has to be to heed the Sustainable Development Commission’s call ‘to produce more food from less land and to eat differently, specifically to eat more plant-based foods, less meat and dairy, and to waste dramatically less”.

To this he adds the need to halt as rapidly as possible the UK’s population growth, by curbing present levels of migration and reducing it to more sustainable levels, bearing in mind the numbers we will be able to feed predominantly from our own resources.

Finally he focusses on another area of import dependence.  A 2007 study, ‘Can Britain feed itself?’ by Simon Fairlie, estimated that it could, but that the dietary changes would be significant, “including far less meat consumption, feeding livestock upon food wastes and residues; returning human sewage to productive land; dispersal of animals on mixed farms and smallholdings, rather than concentration in large farms; local slaughter and food distribution; managing animals to ensure optimum recuperation of manure; and selecting and managing livestock, especially dairy cows, to be nitrogen providers”.

Time to ‘retool’ our provisioning?

“UK agriculture is also reliant upon imported energy, fertiliser, seeds and machinery. So should the availability of such imports become limited because of purchase by more affluent countries, or were we to become unable to afford to purchase such imports in the quantities required, then our domestic agriculture itself would be deprived of such essential inputs”.

And, essentially,  give our food producers – from farmers to small-holders – a fair price covering costs of production plus.

 

 

 

Taking back control of the agricultural economy

Former Conservative MP Matthew Parris asks, “Is ‘food security’ still an imperative for this 21st-century country long unable to home-source many of the other mainstays of our economic life? Why, post-CAP, should we despoil East Anglia and plunder Treasury coffers for fear of relying on Canadian wheat or West Indian sugar?

We all need to take a view on the texture of the rural Britain we want to sponsor, the size, type and location of the farms we want to support, the agriculture we want to see there.

Hill farming on sloping ground. in places rocky, often marshy and reedy, everywhere wet, exposed and windy, and with poor-quality soil whose agricultural use is only grazing. Nearly half of hill-farmers’ income comes from CAP subsidies. For them it’s the foundation of what still amounts to scraping by: they really are just about managing. Ministers guaranteed during the recent referendum campaign that this bedrock would not be disturbed until 2020. Beyond that there are no promises.

Governments cannot strike out in a new direction as suddenly as could an individual like me. Farmers and local businesses have invested whole lives in what they expect, and cannot take too much uncertainty about the future. Nor should the English countryside become just a forest, or a leisure park.

But sometimes there comes a chance to tweak policy gently but decisively in an altered direction, so that things begin to change, giving people time to change too. Could Brexit help us take back control of this at least?

Here are two questions to which I may not know the answer, but we should ask — at least because the compass must anyway be reset by 2020, and I think the Defra secretary, Andrea Leadsom, knows something needs to be done.

Her farming minister, George Eustice (another dedicated Leaver) has struck me as a man prepared to think outside, if not the box, the cowshed: he’s been talking sparkily recently about Britain’s chance to lead the way in land-stewardship and compassion towards farm animals; and on new approaches to underwriting this part of our economy.

Only a monster would deny there should be CCTV cameras in slaughterhouses; but chicken factories, cow prisons, industrial wastelands and giant system-built housing estates are on the march across our countryside.

Brexit is a chance for Britain to reshape its farming subsidies in ways that protect the land and use it more intelligently

There’s money here, and money talks, and ministers must stand up to it. Taking back control shouldn’t be from Brussels alone.

Edited extracts from the Times article (paywall)

 

 

 

Organic farming: better for the climate, soil conservation, biodiversity and food security

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joanna-blythmanThis news will be of particular interest to those who have read about animal factory-farming methods (see the work of Tracy Worcester) and those who were earlier stunned by the exposure of systemic pesticides in ‘Roots of Evil’ (The Guardian 29.4.95) by Joanna Blythman(left) – often described as Britain’s leading investigative food journalist.

In 2016, Scheherazade Daneshkhu, Consumer Industries Editor for the Financial Times, reported that home deliveries of organic vegetables have almost returned to pre-recession levels – £2.1bn in 2008.There has also been a higher demand for organic jam, tea, oils, organic cotton clothes and beauty products.

soil-aShe cited the Soil Association’s 2016 Market Report, free to members, which recorded that sales of organic products rose last year by 4.9% to £1.95bn in the UK – the third year of consecutive growth for the UK organic sector, now worth £1.95bn. Sales of non-organic food dropped by 0.9%.

An increase in the numbers of independent suppliers has helped the sector to establish firm roots

80% of organic sales were made in supermarkets a decade ago and that proportion has fallen to 70% as organic products have benefited from the broader retail trend towards more local and online shopping. Ocado’s organic sales jumped by 19% as the online retailer expanded its organic range by a quarter. Discounters Aldi and Lidl are also gaining share of the market with small but growing ranges.

orc-header-2017The Organic Research Centre is the UK’s leading independent research centre for the development of organic food production and land management solutions to climate change, soil and biodiversity conservation and food security.

Its detailed financial report on organic farming in England and Wales for 2014/15, published two months later also showed organic farm profits increasing, with organic dairy farming outperforming conventional dairy farming in England and Wales.

orc-graphThis research was undertaken for the Welsh Government, a partner in Organic Centre Wales. It highlighted that the organic dairy industry is now generating higher profits during that period than conventional farms despite producing lower yields.

This was due to reduced costs on items such as fertiliser and machinery together with the premium price for organic milk.

Professor Nic Lampkin from the Organic Research Centre, one of the co-authors of the report said:

organic-food-text“Organic farms are far more engaged in production methods that are better for the environment. Restricted pesticide inputs, and more diverse crop rotations contribute to greater diversity and to natural weed, pest and disease control. These are all seen as important reasons for the financial support given to the organic sector . . .

“We have been monitoring the performance and profitability of the organic sector in England and Wales for the past 20 years the analysis of 2014/15 data showed that organic farms achieved higher or similar profitability to comparable conventional farms, and on organic LFA (less favoured area) cattle & sheep farms profitability was statistically higher than conventional farms. At the enterprise level, organic dairying net margins were above the conventional level, whilst for beef and sheep enterprises, organic margins were ahead of the conventional sector. Cropping enterprises also showed a positive position for most organic activities, and therefore it can be concluded that with the addition of support payments, organic farms are performing at a similar or better level than comparable conventional farms”.

However, the Soil Association report points out that despite the third consecutive year of organic sales growth, the amount of land under organic cultivation has continued to fall. There are 548,700 hectares of farmed organic land, down 5% since 2013, according to the Department for Environment, Food and Rural Affairs. The amount of land in conversion to organic is also in decline but the size of the average organic farm has increased, in line with trends in the sector.

More reassuringly, the Organic Research Centre report adds that although numbers fell during the recession, organic farming in England and Wales has stabilised, with fewer farmers withdrawing from the sector and new converters coming on board. 

‘Organic Farm Incomes in England and Wales 2014/15’ can be downloaded here: 2014/2015, PDF 2.04mb – no paywall.

For the full ORC article please click here.

 

 

 

What does Brexit mean for Britain’s food?

A “decades-old failure to invest in food skills and equitable infrastructure for sustainable development” exposed

In Farming UK, Tim Lang, professor of Food Policy at City University’s Centre for Food Policy – a Lancashire hill farmer before becoming an academic and establishing himself as a leading expert on food issues – has said that leaving the EU will expose a “decades-old failure to invest in food skills and equitable infrastructure for sustainable development.”

Stephen Devlin, an economist with the New Economics Foundation, says, “Now more than ever, with enormous economic and political uncertainties in the air, we need to consciously plan the future of the essential food and farming sector.

“Do we want a sector that is increasingly automated and concentrated, or do we want more diverse growing patterns and more farming jobs?”

A just-in-time food system that could easily be dislocated 

Professor Lang told Farming UK that, in the 1980s, the United Kingdom was 82% self-sufficient in food. This had fallen to 61%. The country was running a food trade gap and the fall in the value of sterling since the EU referendum had made imports more expensive.

Over the last 30 to 40 years a food revolution had resulted in a longer food chain and longer storage. Tesco had adopted its just-in-time system from Toyota. At any one time under this just-in-time system there were just three to five days of food supplies in the UK. “It is highly dislocatable,” said Professor Lang.

He said the UK food system was one in which the farmer made very little from the total money generated. All the money is made elsewhere

Lang said food traders ruled the modern food economy and millions of food contracts depended on cross continental supply chains. The food system was heavily tied into Europe. To sever this would be a task “awesome and unprecedented in complexity.”

In an article currently inaccessible on NEF’s website, Stephen Devlin presents a chart showing net EU food imports.

CHART

food-graph-imports

He adds: “It’s crucial that we don’t just blindly increase production in general to produce more of the commodities that we are already exporting, like cereals and milk. Instead we need to produce a more diverse range of produce more in line with what we actually eat – like more fruit and vegetables. In fact, a more diverse farming system may also have environmental benefits”.

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Article reference via search engine:soursce-food

 

 

 

 

Agriculture can reboot the economy: advice from India and Northern Ireland

More precisely: “Contrary to the dominant economic thinking, agriculture alone has the potential to reboot the economy”

devinder-utube-6In a recent article in The Wire an editorially and financially independent site, relying principally on contributions from readers and concerned citizens “who have no interest other than to sustain a space for quality journalism”, Devinder Sharma denounces the practice of outsourcing food production to other countries, and opening up the country to cheaper imports, destroying food self-sufficiency.

Energy desk reports that British taxpayers are paying more than £400,000 a year to subsidise the Newmarket farm of Khalid Abdullah al Saud, a billionaire Saudi prince who breeds racehorses, while successive governments have greedily and stupidly continued to undervalue and short-change agriculture – the most important sector in nourishing and maintaining life.

British and Indian governments encourage the import-export sector in which middlemen, who shuffle paper or figures on a screen, profit from lowering import duty and – as Sharma puts it – ‘opening the floodgates to cheaper imports’ ostensibly justified in the name of ‘taming food inflation’ but really increasing the profits of the establishment peer group.

Another sector is indicted by a Lancashire dairy farmer

She believes that supermarkets – powerful lobbyists and valued party funders – are driving out production of staple British food and compromising food security, adding, “The greedy giants are also putting at risk the livelihoods of hard working British farmers, their families and their communities. Large businesses are gradually asset-stripping everything of value from our communities to make profits which are then invested abroad in places like China and Thailand”.

Shamefully unjust and unwise: in both countries many farmers are paid below production costs for their produce

WT planning

We read that William Taylor and other leaders of Northern Ireland’s farming organisations have been actively lobbying politicians from all parties and none, seeking support for legislation on farmgate prices which would ensure farmers in NI a minimum of the cost of production plus a margin inflation linked across the staples.

The Indian government has offered assurances to farmers in Mozambique and in Brazil that it will procure whatever is produced at a good price. Many will ask why the same assurance cannot be given to British and Indian farmers?

William and Devinder both firmly believe that – contrary to the dominant economic thinking – agriculture alone has the potential to reboot the economy. Outsourcing food production, paying prices below production costs and opening up to cheaper imports will place both countries in a vulnerable position.

 

 

 

Hats off to DEFRA if they continue to ‘reboot’ farm policy in favour of small family farms

private-eye-logo“Not only do small family farms (defined as covering less than 250 acres and requiring the labour of one or two people) employ more people per acre and provide a wider variety of locally produced food than larger farms, but there is increasing evidence that they are less damaging to the environment.”

This passage in the latest Private Eye (1429) mentioned research findings published in a new state funded study carried out in the Netherlands and an online search added detail from the FT.

lidwien_smitDr Lidwien Smit, an environmental epidemiologist at Utrecht University, found that the biggest contribution to deaths linked with air pollution in Europe comes from agriculture, as risky to breathe as that in a traffic congested city.

She recommends that intensive farms in particular should be subjected to the same strict pollution rules as other industries.

In September, the study was presented to the European Respiratory Society’s international congress in London. Professor Stephen Holgate, the society’s science council chair said that the findings underline the need for governments to take tougher action on farm pollution: “It raises a very important issue; there needs to be much better monitoring of intensive farming’s pollution plumes that spread out across the neighbourhood”.

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Private Eye reports that DEFRA is to use part of a £16m EU emergency dairy aid fund to help farmers ‘hit’ by very low milk prices to encourage grass-based farming systems.

The NFU, whose ‘lobby’ is often said to be dominated by large farmers that pay the biggest subscriptions) has, however, made ‘counter proposals’.

The farmer who writes for Private Eye, hopes – as we do – that DEFRA will ‘stick to its guns’ and also that all the UK’s regional governments and national assemblies will go on to make discrimination in favour of small-scale family farms central to farm policy in post-Brexit Britain.