Friday, June 23, 2017

Challenges for grains post-Brexit

The AHFB has produced a comprehensive report on the challenges facing the grain sector post-Brexit: Grain challenges

The report emphasises that the global grain trade is driven by competitiveness. It is a high volume, low margin business, dominated by relatively few multinationals. The UK is a small player in a big market. In the past four seasons the UK exported 11 per cent of its wheat and 17 per cent of its barley crop. Competition for barley export business is likely to get tougher in future. There is no doubt that the UK faces tough competition from lower cost producers with higher outputs.

Any change in trade and support arrangements is likely to lead to structural changes on farm. Further farm consolidation could follow to achieve economies of scale.

The loss of preferential treatment in relation to the EU market is likely to mean loss of access agreements with non-EU countries such as Morocco and Algeria in the absence of new access arrangements and probably tariffs.

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Strawberry prices could soar

Growers have warned that strawberry prices could soar if they no longer have access to seasonal EU workers after Brexit. Already this year the number of seasonal workers has fallen by 17 per cent because of the fall in the value of sterling and uncertainties about the future: EU workers

Former Defra secretary Andrea Leadsom suggested that farmers should invest in machinery as an alternative, but this is not an option for some crops. Machinery would damage soft fruit.

Sunday, June 11, 2017

No need for experts at Defra

There will be no need for experts at Defra after Michael Gove was appointed Secretary of State at the department in the reshuffle of the Cabinet.

It had been widely anticipated that Andrea Leadsom would be replaced and she becomes Leader of the House of Commons.

Monday, June 05, 2017

Confidence levels among farmers falling

Confidence levels among farmers are falling, despite a good short-term outlook, according to this report from The Guardian.

However, it repeats the myth that farmers were among the 'staunchest supporters' of Brexit. Where is the evidence for this statement? To generalise from rural voting to that of farmers is to commit an ecological fallacy, a basic methodological error.

Read the report here: Gloomy farmers

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Tuesday, May 23, 2017

More time for farmers before subsidy phase out

The Conservative manifesto promises to keep farm support at current levels for the lifetime of the next Parliament. This means that farmers will have until 2022 to adjust to a reduction in subsidies, although the downside risk is that the longer time span may lead them to postpone necessary changes, especially when future policy remains uncertain.

According to farm manager George Eustice the intention is to focus on supporting small enterprises and those new to the industry. The introduction of government backed loans could see a revival of a version of the Agricultural Mortgage Corporation set up by Stanley Baldwin's government (it was sold to Lloyds in 1993).

The Government is also considering schemes to help older farmers retire and changes to tenancy legislation to create slightly longer tenancies.

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Wednesday, May 10, 2017

A farmer writes

In an interesting article a Northamptonshire farmer who has a mixed farm writes about how Brexit will affect him and other farmers: The impact of Brexit

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Friday, May 05, 2017

Labour crisis in agriculture

The House of Commons Environment, Food and Rural Affairs Committee was not able to complete its inquiry into labour constraints in agriculture because of the dissolution of Parliament, but has produced a report that highlights some of the key issues: Feeding the nation

The committee does not share the Government's view that the sector does not have a supply problem. It took the view that government statistics are inadequate for measuring agriculture's labour needs, particularly where migrant labour is concerned.

The report says there about 75,000 temporary migrant workers employed in UK agriculture. The NFU says that the sector will need 95,000 seasonal workers by 2021.

Improved living standards in Eastern Europe, the fall of the pound and uncertainty following Brexit have contributed to a labour shortfall in the sector.

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Wednesday, May 03, 2017

Government giving mixed messages to agriculture

With Parliament now dissolved, the House of Lords Energy and Environment Sub-Committee has produced its report on Brexit and agriculture: Brexit report

The report implies that Government has not sorted out its priorities in relation to the sector: 'The Government is currently giving mixed messages to the agricultural sector. Its vision for the UK as a leading free-trade nation with low tariff barriers to the outside world does not sit easily with its declared commitment to high quality and welfare standards in the UK farming sector. Combining and delivering these two objectives will be a considerable challenge.'

The report notes the reliance of the UK agri-food sector on both permanent and seasonal labour from other EU countries. 'This is an immediate challenge which the Government must address urgently.'

The report warns, 'Farmers risk high tariffs and non-tariff barriers on exports, which could render their business uncompetitive, while simultaneously having to adjust to a new UK policy for funding.'

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