Tag Archives: NFU

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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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”.

farms-not-factories-tracy-logo

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.

Labour MEPs call for action to ensure UK dairy farmers get a fair deal

jude and paul mep farrnersIn February, Labour MEPs called for the EU, UK government and consumers to act to ensure North East farmers get a fair deal.

The price of milk in UK supermarkets has fallen to levels which are unsustainable for UK dairy farmers, with prices dropping from £1.39 to just 89p. See DEFRA’s Forecasts of Farm Business Income by type of farm in England – 2014/15.

The NFU suggests that this is leading farmers to leave the industry with around 60 having left in December alone. Milk in supermarkets in the UK can now be cheaper than water and the price can be below the cost of production. In response MPs have called for an EU-wide review of milk prices.

Paul Brannen, MEP (above with North East MEP Jude Kirton-Darling) for the North East and Labour’s European Parliament spokesperson on agriculture and rural development, said:

“It is simply not fair for a dairy farmer to be paid less for a litre of milk than it costs to produce. We must collectively and speedily inject fairness into the relationship between dairy farmers, processors, supermarkets and, importantly, customers . . .

“We also want the UK government to write to the banks encouraging them to be as supportive as possible of dairy farmers during this difficult period, including making loans available.

“And in the longer term we want to see farmers working together more, in order to increase their clout in the market and move themselves up the supply chain, by investing in food processing and the production and marketing of processed products such as cheese and yoghurt, as this is where the money can be made . . .

“We are calling on the British consumer to ask probing questions of their supermarket manager, as they have done in the past about fairly traded products from the developing world, to find out if a fair price has been paid to the farmer for the milk we buy.”

Paul adds: “We want to see more powers given to the Groceries Code Adjudicator, whose role it is to ensure there is fair play between British food processors and retailers, so she can take action across the supply chain.

Food is no longer to be seen as a mere tradable commodity – speculation fodder

This site focuses on the vital importance of food and water provision in this country and worldwide – and this reminder will be repeated until there are clear signs that governments are acting accordingly.

defra header 2At present DEFRA’s policy, cited in the FT, is for government to help the farming ‘industry’ to become more competitive by opening up global food markets to export our produce.

Earlier this year, the FT referred to a report presented at the NFU annual conference, which pointed to an “alarming” drop in Britain’s ability to feed itself and called on the government to reverse the trend with a boost to investment, especially in research and development.

The country’s self-sufficiency in homegrown food has dropped from 80% in 1980 to 62% and is heading further downwards to 53% in 2040 on current trends. Meurig Raymond, NFU president and a Pembrokeshire arable farmer, spoke of the need to import food which was leaving the UK increasingly at the mercy of volatile world markets.

peter wahlPeter Wahl whose thinking we have featured on this site, works on issues of world trade and international finance with the (World Economy, Ecology & Development, WEED) a German policy institute based in Bonn. He calls for the closure of the ‘global casino’ which speculates in food and animal feed, quoting George Soros: “Speculators . . . increase prices with their expectations, with their bets on the future, and their activities distort prices, especially in the commodities sector. And that is just like secretly hoarding food during a hunger crisis in order to make profits from increasing prices.” Wahl continues:

“The price excesses are a threat to food security and thus one of the basic human rights: the right to freedom from hunger and malnutrition.

“Speculation would then be restricted to its security function (hedging) for buyers and sellers, and the formation of speculation bubbles would be prevented. Political will is decisive for this to be achieved. The chances are not too illusory. The present crash has shaken the financial markets so that the casino-capitalism which has emerged since the end of the Bretton Woods system has been discredited to an unprecedented extent”.

Wahl emphasises that far-reaching political change is not out of reach any more:

“This offers a unique opportunity to civil society . . . to exert corresponding political pressure and present proposals on a development-friendly restructuring of the financial system. Civil society should not just suggest reforms in line with the market. This crash of financial market capitalism – which has spread rapidly across the whole globe since Bretton Woods – requires a more far-reaching answer.

global casino hunger“The ideology that the markets are best left to regulate themselves has finally completely disgraced itself before history. Now, this is no longer a question of making the casino safer for the players – but only of closing it down”.

 

Deeply precarious, but worthwhile: small-scale sustainable farming

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The Sustainable Food Trust is committed to facing challenges and exploring solutions for a food production system that causes the least possible harm to both humans and the environment, to the principles of “good science” and to sharing the findings of high quality research with as many people as possible. alicia millerIn a recent post on its website, Alicia Miller writes:

My day nearly always starts with a reluctant rise into consciousness triggered by my churning gut. I can feel the adrenaline pumping before I open my eyes and when I finally wake up fully, I’m filled with a nagging anxiety.

It’s the farm finances that cause my stress. Six years ago, my husband and I bought a small ‘family’ farm of 23 acres and we have a thriving business on it growing organic, local veg – year on year, our turnover has grown. But despite this, we still live well in the red and my freelance income as a writer and consultant is critical to keeping us afloat.

alicia miller and colleagues

It is a deeply precarious existence, running a farm and working freelance – subject both to the weather and the vagaries of casual labour. This was recently brought home to me when one of my freelance contracts tanked unexpectedly and I realised in 8 weeks time, half my income would disappear. I felt relieved that I got a little warning . . .

The economic viability of small-scale farming is next to nil. Everyone is dependent on outside income to make ends meet, and the idea of having a college fund for kids, or money for retirement is such a pipe dream we laugh at it. We all intend to work until we die. Or at least until we can sell the farm, which may be never . . .

There are a lot of reasons that small-scale farming is a difficult business. For us, it’s because we bought land rather than renting it. We wanted stability because we were in our mid-forties and we had some capital to invest. But our business loan was vast – I can remember bursting into tears and sobbing when it was confirmed, partly from relief and partly from terror. I’d never been so far out of my financial comfort zone.

Raised in a stable middle-class family, where we always had enough and never too much, I’ve worked since I was fifteen and, until we bought the farm, I always knew where my next pay check was coming from. Now, we live in a delicate balancing act, trying to keep within the overdraft limits of both our personal and business bank accounts. The people I work for freelance are used to my consistent request to be paid today, if at all possible, when I submit my invoices.

alicia miller produce

Sustainable and small-scale farming operates on an uneven economic playing field. Farming subsidies are linked to size and long favoured industrial farming. There is little financial support for the environmental and social value of sustainable growers. The so-called ‘greening’ of the Common Agricultural Policy was so watered down by the NFU and other agricultural lobbying organisations who loathed to make any concessions to sound environmental practice in farming, that it became pretty meaningless to those working sustainably.

Despite all this, policy makers are increasingly arguing that small-scale sustainable farming already feeds far more people than industrial, and that is how we need to think about the future of our food. The UN’s 2011 Agroecology and the Right to Food Report, argues that we need to decentralise our food production so that crop failures in one part of the world – say rice in southeast Asia – don’t cause a price spike on the commodities market. Small-scale farming also uses far fewer resources, emits far less in the way of greenhouse gases and causes vastly less environmental destruction. But the engine of Big-Ag continues to make all the money.

So why is there a small but growing movement of people going back to the land (realising that there are still many that never left it)? It’s sometimes seen as an upper middle-class lifestyle choice and while there are those who come into farming with money, most of us find that any money we had has been sunk into our operations.

We persevere, hoping year on year, we’ll finally turn a genuine profit that provides a living, so that we can stop and focus on what we do rather than running out the door to that second job. I keep thinking we’re getting closer, but the bills just keep rolling in…

Earlier this summer, we made hay. It’s a generally unpleasant job that leaves you exhausted and aching from lifting, sneezy from the dust and hay, and itchy all over, but there is something elemental about it. As I rode back on the trailer to the barn, the late afternoon sun shone down and I felt good.

My husband likes to tease me about the list of things I didn’t sign up for when we bought the farm – I’m not shooting the bunny rabbits that are feeding in our polytunnels; I’m not running the muck spreader and getting covered in manure; I’m not having tomato seedlings in the bedroom (I lost this battle). But really, this is exactly what I signed up for.

alicia miller biodiversity

When I think about the environmental legacy that the 20th century is leaving to the children of the 21st century, I want to be able to say that in my own small and very localised way, I did what I could to change it. I just hope we last the distance, and don’t lose the farm in the meantime.

Read the full article here.