Farming News Review - April 2009

<< back

Policy issues CAP (etc.) support details/payments Grants Farm finance Product prices

Other crop news Other livestock news Inputs Marketing Miscellaneous

Policy issues

Defra has unveiled a consultation document on post set-aside measures in England. Defra Secretary Hilary Benn has stated a “voluntary approach” would be Defra’s “preferred option” provided it offered a “high degree of confidence” that it could meet its environmental goals. The voluntary approach, known as Option B, has been developed by the NFU and the CLA. It would be based on a new Farm Environment Action Plan managed and led by farmers. It would seek to promote land management practices that address the habitat needs of farmland birds and encourage retention and management of uncropped land. Option A, which would be the mandatory alternative, would require farmers to manage 4-6 per cent of their cultivated land “primarily for environmental purposes.”

CAP (etc.) support details/payments

The Rural Payments Agency achieved its target by distributing 90.4 per cent of total Single Farm Payments by the end of March. Of the total claimant population of 106,500, 93.7 per cent or 99,800 claimants had been paid in full.
Defra must repay £9 millions to the EU for improper use of risk analysis and breaking rules within the export refunds aid scheme.

Grants/regulations/legislation/environment

The EU Nitrates Committee has agreed to a derogation which will raise the livestock manure N farm limit from 170kg per hectare to 250kg per hectare across the UK for the next 4 years. The effect is that the stocking density permitted will increase from 1.7 cow to 2.5 cows per hectare.
Over a third of farms which took part in the 5-year Entry Level Stewardship pilot scheme have yet to re-sign for another 5 year term.
The England Catchment Sensitive Farming Capital Grant Scheme has reopened for the 2009/10 year, but closes for applications on April 30.
The Scottish Government has awarded grants totalling £1.4 millions to 11 businesses as part of the Food Processing, Marketing and Co-operation Grants scheme to generate further investment in the food and drink sector.
The Institute of Biological, Environmental and Rural Sciences, based in Aberystwyth, has been awarded €226,000 as part of a €3 millions European project to measure the environmental benefits of farms in Less Favoured Areas.

Other matters of farm finance and tenure

Research carried out by IGD on behalf of Waitrose suggests the farming industry will need to recruit an additional 60,000 workers by 2019 to ensure agriculture retains its skills base.
Ministers have approved the levy rate for the Agriculture & Horticulture Development Board for the year to March 2010. Horticultural growers are still required by pay 0.5 per cent of turnover rising to 0.55 per cent for late payment. Potato growers must pay £39 per hectare rising to £44 per hectare for late payment. Merchants are charged 17p per tonne.

Product prices

A. Crops

Strategie Grains has, in its March report, reduced its EU-27 2009 crop estimates for wheat and barley to 130.7 million tonnes (down 1.1 per cent) and 63.1million tonnes (down 0.6 per cent) respectively. Coceral predict the same two figures at 128.3 million tonnes and 61.3 million tonnes – also reductions of both previous estimates. The positive effect of these lower expectations on the market has, however, been counteracted by the movement in currencies. Following last month’s depressed oilseed rape market, the price gained strength throughout March; the falling dollar and the steady increase in crude oil values being contributing factors. Cereal prices, having dropped in the early part of the month, strengthened in the latter stages to close at similar levels to last month. LIFFE wheat futures tracked a similar path: varying throughout the month but closing at the same levels as late February. Deliveries in November 2009 and 2010 currently stand at £121 and £129 respectively.
Average prices in late March (£/tonne ex-farm): feed wheat 102, milling wheat 149; feed barley 91; oilseed rape 243; feed peas and beans 132.
Average potato prices remain relatively suppressed. Demand for packing and processing is steady, with the majority of trade being sourced through contract. Supplies of quality material remain tight as producers continue to hold out for higher prices in the progressing season, illustrated partly by the fact that estimated stock levels are 10 per cent above those in March 2008, despite consumption to date being similar. The average price improved marginally from £122/tonne to £123/tonne (21 per cent below those a year earlier). The free market average at the end of the month sat £5 lower at £118/tonne.
At the end of March King Edward was achieving £120 to £135/tonne for average samples; best achieving as much as £170/tonne. Slow Desiree trade saw prices ranging from £95 to £120/tonne, whilst Estima whole crop was commanding between £75 and £110 depending on baker content. “General pack” graded Maris Piper prices were between £100 and £110/tonne, with grade 1 samples obtaining as much as £160.

B. Livestock

Average steer prices, after months of volatility, held comparatively steady this month. Prices by the middle of the month dropped back to 153p/kg lw only to recover again to close the month at 157p/kg lw. Average heifer prices continue to carry a premium, which by the end of the month was 2.5p/kg lw. The price of dairy cows demonstrated a net decline over the month, with animals changing hands in late March at an average price of £1,280 per head.
Lamb prices, having ended February on a downward trend after two months of strong improvement, rose further in March. The UK average lamb price at end of the month stood at 173p/kg lw; up 6 per cent on last month and over 25 per cent higher than a year ago.
Average pig prices continued last month’s strong growth rate, reaching 143p/kg lw in late March to stand up 5p/kg above February levels and 29p/kg (more than 25 per cent) above prices a year earlier.
The average farmgate milk price for January (reported in March) was recorded as a substantial drop of 0.79ppl to 25.57ppl; this being 0.24ppl below prices in January 2008. With the 2008/09 milk year now over, initial reports suggest that most EU member states are well below quota. Expectations are that the UK will report its lowest output for 35 years (approximately 12% under quota). Average milk quota prices, having gained value in the preceding two months, dropped back sharply to close at 0.20ppl for clean holdings (4% butterfat).

Other crop news

EU Environment Ministers have voted overwhelmingly against a proposal of the European Commission to overturn the ban on genetically modified maize on scientific grounds.
December 2008 census figures published by the Scottish Government show the area of wheat plantings in 2008 fell by 22.4 per cent compared to a year earlier; barley plantings fell by 9.5 per cent; winter oilseed rape planting fell by 11.7 per cent. Similar information published by Defra for England reports that wheat plantings fell by 14 per cent; barley plantings fell by 2 per cent; winter oilseed rape plantings fell by 4.9 per cent.
The European Commission has imposed anti-dumping and anti-subsidy import duties of £244 to £385 per tonne on biofuels to prevent producers taking advantage of US subsidies.
Potato growers in the Yorkshire Wolds have been warned that potato cyst nematode is increasingly affecting the region’s crops.
HGCA has published a new version of the Wheat Disease Management Guide.
A Dublin-based grower, Peter Keogh & Sons, has launched a new potato, Selena, which is enriched with the naturally occurring micro-nutrient selenium which is an essential mineral and potent antioxidant and plays an important role in the immune system.
Jersey Royal planting has started a month earlier than usual as growers endeavour to recover losses caused by heavy rain in the past two years.
The yield levels of leek crops is well down on last year as a result of late planting, freezing conditions and limited growth over the winter period.
Select Lincolnshire has unveiled a new, pink onion which has taken over 10 years to develop. The product has been grown by Fraser Key of Sleaford and is milder than the traditional red onion.
Organic Farm Foods is to operate the first thermal pest control system in the UK. The process applies a high-velocity stream of 100°c air on to the crop and surrounding microenvironment to reduce the need for pesticides.
Defra and the Welsh Assembly Government has unveiled Healthy Bees, a plan to protect and improve the health of honeybees in England and Wales. The 10-year plan has been drafted in consultation with beekeeping organisations. It aims to sustain honeybee populations by supporting beekeepers and to ensure effective biosecurity measures are adopted to minimise risk from pests and disease.
Fears are growing for the future of the East Malling Research Station. The centre is in its last year of Defra-funded support and is struggling to secure funding from other sources. Recently members of the strawberry breeding programme fell from 13 to 8 due to budget constraints.
Warwick HRI’s Kirton research centre closed on 28 February.

Other livestock news

The Government has published its bovine TB statistics for 2008. The figures show a 42 per cent rise on 2007 in the number of cattle slaughtered to nearly 40,000; a 19 per cent rise in new incidents to almost 5,000; a 20 per cent increase to 7,928 in herds restricted, nationally 9 per cent of herds are restricted; Devon is the worst county in England with 1,429 restricted farms and 527 confirmed new incidents; Leicestershire has the fastest growing problem with a 41 per cent increase in restricted herds.
Badgers are to be culled as part of the next phase of the Welsh Assembly’s bovine TB eradication programme. The cull will be concentrated on an area of around 200 sq. hm in north Pembrokeshire. The scheme will involve culling up to 1,000 badgers and is expected to cost £4 millions.
Defra has announced that an injectable bovine TB vaccine will be used in six areas of up to 100 sq. km where there is a high incidence of the disease next year under the 5-year Injectable Badger Deployment Project.
Defra has confirmed that bluetongue vaccines will not be granted an expiry date extension. Some unused vaccine has already expired with the remainder due to expire by the end of June.
EU Farming Ministers have defeated a motion proposed by Hungary which would have introduced an optional element into EID rules.
Negotiations in Brussels led by the Welsh Assembly Government could result in changes to regulations which would see on-farm containment prior to disposal of fallen stock being permissible from the middle of 2010.
A documentary film commissioned by the Soil Association shows a new strain of MRSA in pigs in Europe. Up to 40 per cent of Dutch pigs and 50 per cent of Dutch pig farmers are reported to be carrying the strain.
Proposed rules as a result of a vote in the European Parliament would mean that at least 300 more pig farmers in the UK would be covered by the Integrated Pollution Prevention and Control Directive. The cost of complying with the Directive is estimated to average £25,000 per farm.
The Cattle Health Improvement Plan Scotland has been launched to encourage farmers to work in partnership with vets to tackle BVD.
The Agricultural and Horticultural Development Board levy on English pigs is to be increased to 85p per head for 2009/10.
Arla has reduced its price of organic milk paid to producers by 2 ppl to 33.5 ppl.
NMR has revealed that, in the 12 months to September 2008, average milk production fell to 8,020 kg, down by 56 kg on the previous 12 months. However, average butterfat increased from 3.91 to 3.95 per cent and protein rose from 3.22 to 3.24 per cent.
DairyCo has reported that world output of dairy commodities is falling despite increases in milk quota in the EU. UK production is likely to be 12 per cent below quota in 2008/09; France is expected to be 5 per cent below quota, Germany 3.5 per cent and Spain 3 per cent. Italian production is expected to be 2.5 per cent over quota, Austria 2 per cent. In the United States milk supply is expected to fall 0.5 per cent compared to 2008.
Figures from BOCM show that dairy farmers in the North and Scotland achieved a margin of 19.07 over purchased feed per litre in 2008 compared to 19.4 – 19.5 ppl elsewhere. Despite this the technical performance of farmers in this region meant they made the most margin per cow.
Defra has revealed that 15,000 dairy farmers have quit the industry in England since 1997. In 2008 there were 20,122 dairy farmers down from 35,104 in 1997.
December 2008 census figures published by the Scottish Government show that cattle numbers fell by 2.7 per cent compared to a year earlier; sheep numbers fell by 7.7 per cent; pig numbers fell by 15 per cent; poultry numbers fell by 3.5 per cent. Similar information published by Defra for England show that cattle numbers fell by 1.8 per cent; sheep numbers fell by 7 per cent; pig numbers fell by 2 per cent.
The December 2008 census undertaken by the Welsh Assembly shows that sheep numbers in Wales fell by 10 per cent from 2007. The breeding flock fell by 8 per cent and, within that, the number of shearling ewes fell by 10 per cent. Cattle and calf numbers fell by 2 per cent; the number of dairy females over 2 years old fell by 3 per cent; the number of non-dairy females over 2 years old fell by 5 per cent. The pig herd fell with the number of breeding sows down by 22 per cent to 3,000.
Exports of beef in 2008 rose by 36 per cent to 81,000 tonnes compared to a year earlier mainly due to increased demand from the Netherlands, Ireland, Belgium and Italy. Exports of sheepmeat rose 25 per cent to 86,000 tonnes.
The United Arab Emirates has lifted foot-and-mouth related UK export restrictions.
The Soil Association has decided against granting organic livestock farms a “feed holiday”, originally proposed to help farmers suffering from a combination of falling demand for organic food and high organic food prices.

Inputs/Supply businesses

The European Crop Protection Association has advised that 13 of the 27 pesticides approved for use in organic farming have failed EU safety tests.
The biofungicide Serenade, based on a strain of the naturally occurring bacterium Bacillus subtilis, has been granted a specific off-label approval for use on most protected and outdoor edible crops.
The “Tried and Tested” nutrient plan has been launched offering advice to help farmers save money through more efficient fertilizer use and better farming practices. The NFU, FWAG, LEAF, AIC and CLA have all contributed to the guide.
GrowHow has reduced UK produced Nitrogen by £60 per tonne to around £265 per tonne.

Marketing

Defra has opened consultation on the implementation and enforcement of the EC Marketing Standards in fresh fruit and vegetables. The revised EC Regulation 1221/2008 comes into force on 1 July. The Specific Marketing Standards will be reduced from 36 to 10 products.
Figures released by UK Trade and Investment show that fresh produce exports in the first 9 months of 2009/10 rose by 14.4 per cent. Fruit and vegetable exports rose to £485 millions, sales from the food and drink industry as a whole increased to £10 billions, an increase of 16 per cent.
The first ever produce to be grown at Thanet Earth went on sale last month. Cucumbers were delivered to the Tesco Extra store in Broadstairs.
QV Foods Ltd has acquired the retail and foodservice of MBM Produce Ltd, based at March.
KG Growers has acquired Berry Gardens Ltd while Driscoll’s and Alconeras have acquired the mainland European marketing and plant supply companies.
Marks & Spencer has marketed English strawberries earlier than ever before with the arrival of Lambada variety from East End Nurseries on 10 March. High levels of light in the Humberside area have contributed.
Sales at Sainsbury’s in the past 3 months rose by 2.7 per cent or 6.2 per cent excluding fuel.
Waitrose has revealed a 0.4 per cent rise in annual sales but has approached 1,000 of its suppliers requesting a 2 per cent cut in prices.
Serious Food Ltd, the UK subsidiary of Jamaica Producers Group Ltd, has been placed in administration.

Miscellaneous

Greenvale AP, the UK’s largest supplier of fresh potatoes, has joined the Association of Labour Providers, the trade association for organisations that provide and use temporary, contract and seasonal workers.
The Royal Smithfield Club has joined forces with the Royal Agricultural Society of England to put on AgriLIVE Smithfield at Stoneleigh Park on 11 and 12 December.
The Farm Buildings Handbook is to be published this month by the Rural and Industrial Design and Building Association.
Sarah Pettitt, a Lincolnshire grower, has been elected as chairman of the NFU’s horticulture board.
Paul Temple has resigned as NFU vice-president.
Sir Martin Doughty, Chairman of Natural England, has died.