Farming News Review - December 2011

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

Other crop news Other livestock news Inputs Marketing Miscellaneous

Policy issues

As part of the Government’s Rural Economy Growth Review it is to inject funding of £165 millions into the Rural Development Programme for England. £100 millions will go to help small businesses; £20 millions will be used to extend superfast broadband to the remotest areas; £15 millions will be allocated to Rural Growth Networks to overcome a lack of local infrastructure, skills and business support; £25 millions is to promote rural tourism; loans totalling £15 millions will aid community-owned renewable energy schemes; action will be taken to make it easier to change the use of farm buildings to tackle the shortage of rural business premises.
The European Commission has published a 5-year action plan to address the issue of increased drug resistance caused by the use of antimicrobial products. It has been suggested that 25,000 patients are dying each year in the EU from infections caused by drug resistant bacteria adding £1.2 billions to healthcare costs. The 12-point action plan promises to “strengthen EU law on veterinary medicines and on medicated feed” and make new recommendations for “prudent use” of antimicrobials in veterinary treatment.
The Government has announced it is reviewing whether it remains appropriate for Defra to continue to have responsibility for the Gangmasters Licensing Authority.

CAP (etc.) support details/payments

Defra has set the Rural Payments Agency targets to pay a minimum of 86 per cent of eligible claimants and 78 per cent of the total estimated value by the end of December and to pay 95 per cent of eligible claimants and total estimated value by the end of March.
The Parliamentary Ombudsman has upheld complaints from 9 farmers about the Government’s handling of the Single Payment Scheme in 2005 and 2006. Defra and the Rural Payments Agency have accepted the ruling and will pay compensation even though the farmers missed out on payments because of their own “innocent mistakes” as the mistakes should have been noticed by the RPA.

Grants/regulations/legislation/environment

The Government has introduced the Farming and Forestry Improvement Scheme to provide grants of between £2,500 and £25,000 until December 2013. Grants will cover up to 50 per cent of the cost of projects in upland areas and 40 per cent in lowland areas. Projects can cover improving soil quality and reducing artificial fertilisers through better use of farm slurries and manures; reducing energy use; investing in new machinery to process timber more efficiently; saving, recycling and reusing rainwater; improving farm animal health and welfare.
The Government has made available £840 millions to deliver biomass and other renewable heat technologies over the next 20 years. Payments will be based on the metered amount of heat generated by eligible technologies installed since July 2009. Biomethane producers will receive payment based on the metered amount of biomethane injected into the grid.
The NFU 2011 water survey has revealed that the volume of water used is largely driven by farm type and location; most farms use less than 20 cubic metres per day; 71 per cent use mains water from the public water supply; 16 per cent have access to a reservoir; 18 per cent irrigate crops; 40 per cent of water needed to irrigate was abstracted before the season started; 55 per cent of farms have limits on their abstraction licence.
The latest report from UK Wild Bird Indicators shows the turtle dove to be the most threatened farmland bird; farmland bird species are at their lowest levels since records began in 1970; starlings, yellow wagtails, lapwings and greenfinches are all in decline; greenfinch numbers are in decline due to trichomoniasis; goldfinches have recorded the highest increase on farmland.
The Government has allocated £80 millions to the Biotechnology and Biological Sciences Research Council to create new research facilities at Pirbright. The grant will fund new high containment laboratories, experimental facilities and support infrastructure for studying avian flu and other animal diseases.
Figures released by WRAP show that UK domestic food waste fell by 1.1 million tonnes, or 13 per cent, between 2006/07 and 2010.
The British Leafy Salads Association has secured EU funding of £139,728 to support a grow-your-own salad scheme for primary schools in 2012.
A lottery grant of £50,000 will fund a team of conservationists and volunteers with the Suffolk Traditional Orchard Group to survey 700 old orchards.

Other matters of farm finance and tenure

Defra’s Farm Business Income report shows cereals incomes rose by 97 per cent in real terms in 2010/11; dairy incomes rose by 7 per cent; livestock incomes fell by 29 per cent in lowland areas and 19 per cent in upland areas; horticultural incomes fell 27 per cent.
The NFU has unveiled proposals for a new Seasonal Agricultural Workers Scheme including training initiatives and welfare-benefit adjustments to encourage more UK citizens to take up jobs in horticulture.
In the final reading of the Public Bodies Bill MPs voted against the amendment which aimed to block the Government from bringing forward legislation to abolish the Agricultural Wages Board.
The latest Defra Farm Business Survey has revealed that horticultural businesses saw a 27 per cent fall in farm business income in the year to February while 24 per cent of businesses achieved no income whatsoever. The average net profit was £48,000 with over a third represented by subsidies of one form or another.
The Farming and Wildlife Advisory Group has gone into administration owing 5 weeks’ wages to its 124 staff.
An NFU Cymru survey has found that 60 per cent of Welsh farmers are more confident about their short-term prospects than they were a year ago. More than 50 per cent are expecting to increase production in the next 5 years, only 14 per cent are expecting to cut back.
The NFU is reviewing the possibility of establishing an insurance package to cover sugar beet losses to frost.
Smiths Gore has reported that prime arable land in Scotland is now averaging £5,000 per acre with some making over £8,000 per acre, up about 5 per cent on a year ago.
A 95 acre block of prime arable land in Lincolnshire has sold for £1.52 millions, an average of £18,055 per acre, believed to be a UK record.

Product prices

A. Crops

The grains and oilseed markets remain bearish. The International Grains Council’s November report tweaked further the 2010/11 harvest total grains yield (to 1,752 million tonnes, which is 34 million tonnes below the expected consumption) and recorded the latest estimate for the 2011/12 harvest yield marginally down from last month at 1,816 million tonnes (10 million tonnes below expected consumption). The changes are due to reduced expectation on maize output from the US, countered by increased output of cereals expected from the Commonwealth of Independent States and good growing weather in Australia and South America. The continued financial instability in Europe, now expected to lead to a second wave of recession, is suppressing markets at a world level, even before futures trading and currency fluctuations are factored in. LIFFE feed wheat futures have again weakened across the board. In late November, deliveries for November 2012 and 2013 stood £139/tonne (down £7) and £139/tonne (down £5) respectively.
Average spot prices in late November (£/tonne ex-farm): feed wheat 139; milling wheat 150; feed barley 140; oilseed rape 339; feed peas 172; feed beans 174.
The average potato price finally showed signs of a little resilience in November, ending the trend of tumbling prices. By late November, the weekly average was up to £109/tonne, £10 above the October close but still £35 below the average price in November 2010. The free-market price has been more volatile, gaining some strength in the early and mid parts of the month, to a peak of £92/tonne, before dropping back in the final week, closing up overall by £3 at £86/tonne. With harvest long finished, storage conditions are the main focus for growers. Continued mild weather in the South is hampering ambient storage, leading to the high levels of crop being available for movement at the present time. Cold stores remain sealed, which may still lead to further market saturation later in the season.
By late November: King Edward prices were slightly weaker, at between £95 and £135/tonne for grade one. Desiree prices again remained steady at £100 to £130/tonne for grade one. Estima prices had recovered to between £70 and £100/tonne for grade one, with premiums paid for high baker content; whilst Maris Piper prices too were improved at between £100 and £140/tonne for grade one.

B. Livestock

Steer prices were a little more volatile in November, dropping back over the early weeks, and then recovering before dropping back again. The average price closed at 184p/kg, the same as the late October close; 30p/kg (19 per cent) above the price a year earlier. The average heifer price followed a different path entirely, improving steadily over the course of the month. By the end of November the premium over steers had improved materially from just below 1p/kg in late October to over 5p/kg; an average price of 189p/kg lw, 28p/kg above prices in late November 2010. Average dairy cow prices dropped back over the course of the month to a closing position of £1,329 (£1,334 a year earlier).
Finished lamb prices have jumped substantially over the course of the month, gaining 24p/kg lw (14 per cent); an outcome exceeding the expected seasonal trend resulting from buyers starting to prepare for the Christmas period. By the end of November the average price stood at 197p/kg lw; 30p/kg (18 per cent) above the price a year earlier.
The average pig price continued its recovery over the course of November by gaining a further 2.5p/kg at a point in the season when the price was dropping a year earlier. The average price by the end of November was 147.5p/kg lw, 11p/kg above the average a year earlier.
The average UK farmgate milk price for September (reported in November) was an improvement of 0.55ppl over the August average of 27.54 ppl; entering further into uncharted heights of milk prices for the UK. The September average of 28.09 ppl is 11 per cent above the average price a year earlier and yet is still well below the EU27 average of 31.28ppl. Milk quota prices have fallen back considerably this month; the average price for clean 4% butterfat holdings at the end of November stood at 0.26ppl, whilst leased quota (also 4% butterfat) remained static at 0.07ppl.

Other crop news

The Centre for Ecology and Hydrology in the UK has reported that current levels of ambient ozone concentrations are reducing crop yields across the world and with ozone concentrations forecast to increase, further yield losses are expected. Yield losses in ozone-sensitive crops are put at 10-20 per cent with yield losses in wheat in Europe estimated to be 13 per cent.
Rothamsted Research has published its “Where Knowledge Grows” strategy which brings together environmental and food security research with the aim of improving crop productivity and quality alongside environmentally sustainable solutions for food and energy production. The strategy will be delivered through 4 themes: 20:20 wheat, cropping carbon; designing seeds; delivering sustainable systems.
The United States Department of Agriculture’s world agricultural supply and demand estimates wheat stocks stable at 203 million tonnes.
The CropMonitor 2011 winter wheat disease survey has shown that septoria was the most important disease although average levels were less than 1 per cent of the flag leaf area. Nationally septoria tritici affected 56.5 per cent of winter wheat with the north-west worst affected. Septoria nodorum was not recorded but yellow rust was at its worst since 1999 and brown rust was found in 8 per cent of crops having been absent in 2010. Tan spot continued its upward trend again to a record level while eyespot was at the lowest level for 20 years. Almost 30 per cent of stems were affected with fusarium while ear blight was found in 21 per cent of crops, less than half that in 2010. Glume blotch affected 85 per cent of crops.
SY Venture and Archer are potential malting barley varieties to join the HGCA 2012/13 Recommended List offering yield rating improvements of 5 and 3 points respectively over Winsome’s 99 rating. KWS Meridian is a conventional 6 row feed barley with 4 per cent more yield than Escadre. Hybrid Boost has been removed from the List. Odyssey, Chronicle and Overture have been added to the spring barley list while Forensic, Scout, Panther and Publican have been removed. Additions to the winter wheat list are Group 1 Crusoe, Group 3 Torch, soft milling Group 4 Horatio, hard Group 4 KWS Gator and hard milling feed Relay. Oakley, Robigus, Cassius, Gladiator, Glasgow, Istabraq and Kingdom have all been dropped. For oilseed rape, DK Camelot, DK Expower and Thorin have been added to the List for the east/west region while Palace, Artoga and Cracher join the List for the North. Excel, DK Secure and NK Bravour have been removed from the east/west region while Emerson, DK Secure, Hornet, NK Bravour and NK Grace have been removed from the north region.
Openfield has won a contract to supply feed wheat to the United States.
The Potato Council has estimated this year’s crop to be up 3.5 per cent on last year at 6.053 million tonnes although the planted area is 0.4 per cent lower at 312,163 acres. Average yields are 19.4 tonnes per acre compared to 18.7 tonnes per acre in 2010.
The Potato Council is proposing a 3 per cent levy increase for 2012/13.
BASF has sought European Union approval for a genetically-modified potato Fortuna which is resistant to late blight.
Researchers at the John Innes Centre have unravelled the structures of invasive protein molecules used by Phytophthora paving the way for the control of such diseases as potato and late tomato blight.
Seed potato exporter Irish Potato Marketing Ltd has acquired AJ Allan of Scotland.
Preva Produce of Norfolk has introduced a red and white potato called Miss Blush.
In the latest Pulse Recommended List, pale Lilum winter bean Husky is fully recommended for 2012 as is Clipper while Honey is provisionally recommended. For spring beans, Pyramid and Fury joins Fuego as fully recommended with Babylon and Boxer provisionally recommended. Large blue pea varieties Bluestar and Daytona join Crackerjack and Prophet as fully recommended while Maple pea Mantara gains the same status.
Gleadell Agriculture is to buy Dunns (Long Sutton).
English Apples & Pears has announced a 2011 crop of apples and pears of 33,100 tonnes, 17 per cent up on 2010. Cox production fell by 1 per cent; Gala rose by 21 per cent; Braeburn rose by 40 per cent; Bramleys fell by 18 per cent.
A new project at East Malling Research is to study how the rate of establishing a controlled low-oxygen atmosphere affects the storage quality of Bramley’s seedling apples.
Researchers at East Malling Research are to examine whether higher storage temperatures for Conference pears can help overcome the problem of fruit treated with SmartFresh failing to ripen when brought out of store.
The James Hutton Institute near Dundee is to undertake a 3-year hortLINK project, supported by the Horticultural Development Company to unravel the genetic basis of firmness in soft fruit with the aim of breeding berries with improved handling properties and shelf life.
Trials undertaken by East Malling Research growing strawberries using deficit irrigation techniques have revealed potential water savings to 3 to 36 per cent, fertilizer savings of 3 to 19 per cent, a 5 to 18 per cent increase in class 1 fruit and improved firmness and flavour.
East Malling Research has revealed anti-mite chemicals can help reduce the red berry disease that causes part of the blackberry drupe to stay red.

Other livestock news

The 2011 Eblex Business Pointers “costs of production” survey shows a £250 per head difference in fixed costs between the top and bottom third of lowland beef suckler herd producers with a £95 per head difference in variable costs. In Less Favoured Areas the differences are £176 and £83 per head.
A Quality Meat Scotland “confidence and intentions” survey has found that 35 per cent of those farmers with a suckler herd were more confident about their future than they were a year ago while only 7 per cent were less confident. More finishers and store sellers are planning to sell cattle younger and almost all those surveyed are planning to invest in grassland improvement.
Scientists from the Roslin Institute, Edinburgh have discovered that some degree of resistance to bovine TB is inherited and have identified genetic markers associated with this resistance. It may therefore be possible to selectively breed cows which are more resistant to the disease.
The Scottish Association of Meat Wholesalers has reported cull cow slaughtering up 20 per cent during the past 3 months compared to the same period last year leading to fears of a further reduction in calving in 2012.
Figures from the Veterinary Medicine Directorate show that UK antibiotics use rose by 11 per cent in 2010 following a 4.9 per cent rise in 2009.
Cattle scab has been confirmed in Wales, England and Ireland having been eradicated from the UK 50 years ago. The source is thought to be imports from Europe.
Welsh red meat promotion agency, Hybu Cig Cymru, has reported the average Welsh farm only covered 99 per cent of its costs in the past year compared to 101 per cent a year earlier although the best performing farms covered 126 per cent of costs, down from 133 per cent.
UK-bred Blonde embryos are to be exported to Australia for the first time.
The 2010 Scottish calf and lamb crop year survey has shown the top-third suckler herds achieved a 3 per cent improvement in calves reared per 100 cows and sold calves typically 25kg heavier while using significantly less concentrate feed per cow; cereal based cattle finishers averaged a gross margin of £115 per animal; forage based finishers averaged a gross margin of £131 per animal; the Less Favoured Area hill sheep average gross margin was £29 per ewe; lowground breeding ewes averaged £70.50 gross margin per ewe; store lamb producers averaged a gross margin of £9 per lamb.
Defra has revealed that it will not renew its foot-and-mouth vaccine bank when it expires in 2012. Instead it will rely on the “substantially enlarged” EU bank.
Eblex increased its net levy income on the slaughter of cattle and sheep to £12.665 millions in 2010/11, up from £12.427 millions in 2009/10.
Animalcare has introduced Tilmodil for use against pneumonia in cattle and sheep, foul in the foot in cattle and footrot and mastitis in sheep.
The Food Standards Agency has launched a consultation process which could lead to an ending of livestock movement restrictions in North Wales and Cumbria following the Chernobyl nuclear disaster over 25 years ago.
The NFU and the Badger Trust have formed an alliance to trial vaccinating badgers against bovine TB on two farms owned by NFU members.
A European Commission report has recommended the enforcement of livestock transport regulations be tightened.
Defra census figures report UK dairy cow numbers down 1.8 per cent at 1.81 millions in June compared to a year earlier, a 7.2 per cent decrease over 5 years. However, 1 to 2 year old heifer numbers increased by 0.4 per cent and under 1 year old heifer numbers increased by 2.3 per cent.
The September EU 27 weighted average milk price was 31.28 ppl, up 1.2 per cent on August and up 6.6 per cent on the year. However, the UK farmgate price was 28.03 ppl making it the 7th lowest and the 2nd lowest in the EUI5.
Harbro has launched Fibertek, a natural dairy additive designed to improve fibre digestion in the rumen, claiming increased yields of 1.4 litres per head and improved feed conversion ratios of up to 4 per cent.
Pfizer VPS has introduced a free bulk milk test to indicate whether treatment of adult dairy cows for gastrointestinal worms is justified.
The Royal Association of British Dairy Farmers is to rebrand the Dairy Event and Livestock Show to the Livestock Incorporating Dairy Event and to change the date in 2013 to the first week of July.
While the numbers of Welsh breeding ewes is constant at 4,118,000 the number of lambs has risen by 10 per cent resulting in an overall flock increase of 5 per cent to 8.6 millions. Cattle numbers have fallen from 1,138,000 to 1,123,000; pig numbers have fallen 4 per cent to 26,000; the poultry flock has increased by 7 per cent.
The British Texel Society has created a £100,000 research and development fund to support future innovation for the development of the breed to suit UK commercial customers.
New Zealand is facing its second smallest lamb crop in the past 55 years although the 2011 total of 26.51 millions is up 1.72 millions on 2010.
NFU Scotland has engaged lawyers to investigate a legal challenge to the rules concerning the electronic identification of sheep.
The Bpex InterPig report has indicated the cost of pig meat production rose by 9 per cent in 2010, 9p per kg above the European average.
Prochile, the Chilean government export development agency, is endeavouring to attract UK pig companies to invest in Chile.
Scientists at the Roslin Institute at the University of Edinburgh and the Institute for Animal Health have identified a gene IRG1 which makes chickens more susceptible to Marek’s disease. The gene is thought to cause the death of cells and also encourage turnover growth.
The Welsh Animal Health and Veterinary Laboratories Agency is to undertake specific checks on packing centres to determine whether imported eggs are derived from hens reared in conventional cages.

Inputs/Supply businesses

The Chemicals Regulation Directorate has announced an interim extension to the Local Environmental Risk Assessments for Pesticides scheme which could result in the introduction of aquatic spray buffer zones of up to 20 metres against watercourses.
Syngenta has announced a nationwide series of stewardship workshops to ensure potato growers and operators get the best possible results with nematicide Nemathorin and fungicide Amistar.
The National Association of Agricultural Contractors has introduced the Assured Land- Based Contractor scheme for contractors applying potato sprout suppressant chlorpropham with the aim of raising application standards.
Sirius Minerals has discovered one of the world’s single thickest potash intersections in North Yorkshire.
ECOSpray has launched a granular nematicide based on plant-derived polysulphides.
Koppert Biological Systems has developed the predatory mite Amblydromalus limonicus to deal with glasshouse infestation of thrips and whitefly.

Marketing

Figures from the British Retail Consortium show that food inflation fell from 5 per cent to 4.2 per cent in October, the largest month-on-month drop for over 2 years. Vegetables fell by 2.4 per cent and fruit by 1.6 per cent.
The UK Government has announced that contracts worth up to £50 billions will be available via a new website including the supply of fresh produce to hospitals, schools and other government facilities. In addition most public procurement processes are to be reduced to 120 days from January, a reduction of 80 days.
Cranfield University, the Fresh Produce Consortium and IGD have been commissioned by Defra to carry out a study into the demand for different quality tiers of fresh produce. The aim is to help Defra understand the impact of, and barriers to, increasing the availability of lower quality fruit and vegetables to consumers since changes to EU marketing standards in 2009.
Sainsbury’s has announced it is to double its sales of British food to £8 billions a year by 2020.
The Countryside Alliance Foundation has revealed that 65 per cent of local education authorities do not know the country of origin of the food they are buying for their school children.
Fresh Fruit Services, a packer from Sheerness, has gone into liquidation.

Miscellaneous

Registrations of agricultural tractors over 50 hp reached 11,851 units in the first 9 months of the year, an increase of 3.8 per cent over the same period in 2010. Increases were 15 per cent in Northern Ireland, 12.5 per cent Yorkshire and Lancashire while registrations in the Eastern Counties fell by 3.9 per cent.
The Health and Safety Executive has reported that agriculture is still classed as the most dangerous industry in which to work following 34 fatal injuries in the year to March and 221.9 major injuries per 1,000 workers.
The Anaerobic Digestion and Biogas Association is to hold its national conference at One Great George Street, Westminster on 14 December.
The Syngenta Vegetable Nozzle has won the 2011 British Carrot Growers Innovation Award. The nozzle design creates extra energy and velocity to achieve more effective spray penetration in dense carrot canopies.
East Malling Research has launched a £15 millions fund raising project for a new laboratory building.