Here come the robots

I am always a little sceptical of technological fixes.   They are always accompanied (understandably) by a certain amount of boosterism, not just from the innovator or the operating company, but also from politicians.   Technological adoption is in practice socially mediated.

There is no doubt that the fruit and vegetable sector has been hit hard by Brexit in terms of his ability to secure labour need for picking, sorting and packaging.  Far fewer workers than in the past will be let in under the seasonal workers scheme and many regulars have been put off by the fall of the euro against the pound.

The usual response from British politicians is to recommend the use of more local labour.  However, relatively few of those who express an interest sign up and many of those that do don't last.   Even when they do, their picking rates are poor.   It is monotonous, backbreaking work.

The second type of argument used by politicians is that the answer lies in the use of new technology and that indeed a scarcity of labour could help to force its adoption.   I am all for new technology if it is appropriate and affordable.

Devising robots to pick and service, for example, soft fruit is no easy task and it has to be recognised we are some way off effective availability at an affordable price.  We would also need people with the right skills to programme and maintain the robots, although usually that service is provided by the manufacturer.   

The capital cost issue can be dealt with by growers not buying the robots but paying a fee based on the crops harvested.

The estimable Judith Evans had a long article on the topic in the Financial Times yesterday.   Without breaching the Pink Un's pay wall or copyright, I think that I can quote a few key points:

1. For now we are really at an 'advanced research and development stage'.   Claims about commercial availability vary, but we are at best a few years off in terms of any substantial impact. Norway's Sage Roberts hopes to have 10 to 15 robots in the field next year to fight mildew on strawberry plants, followed by a harvesting function in 2022.
2. Eventually, robots should be able to reduce the number of workers required for harvesting by 50 to 70 per cent.
3. Robots do not necessarily pick faster than humans, but they can operate around the clock.

The Government is funding several robot projects, e.g., a demonstration farm in Kent.

Read more from a leading company here: https://xihelm.com/

Agriculture and food move further apart

The Covid-19 pandemic has seen a massive increase in supermarket power in the food chain with much of the hospitality sector closed down, says Tim Lang of City University.  I would add, how far will people revert to their former habits of eating and drinking out when we eventually return to a version of normality, a date that is advancing into the future.

Lang also says: 'UK food policy has fragmented despite talk of "levelling up". English farm policy now says next to nothing about food. It’s focused on ecosystems. Northern Ireland’s border is becoming the Irish Sea, not 310 land miles. The Agriculture Act anticipates dramatic cuts in farm subsidies. At last, say some. Me too, as they kept farmers in serfdom, producing too cheap commodities from which others took the value – but no-one wants more expensive food.'

Some real dilemmas there.   I have started work on a commissioned book on a radical analysis of agriculture and food policy.  One of the challenges is to see how far we can integrate the two, as happened during and after the Second World War.  Given the tendency of government to operate in 'silos', I am not too hopeful.

Biden presidency will slow down US trade deal

An article I wrote for South-East Farmer on the Biden presidency and a US-UK trade deal:

What will the Biden presidency mean for the trade deal with the United States and Brexit more generally?   One thing that is clear is that it will not proceed as quickly as it would have done in the absence of a change of administration.  

There are a number of reasons why this is the case.  First, Joe Biden has made it clear that the emphasis in the early phase of his presidency will be on domestic issues, specifically the Covid-19 pandemic.    International trade will not be a priority. Second, a new administration means a change of personnel.   A new US Trade Representative will need to be appointed to run what is in effect the US’s Department of International Trade and that will take at least two months after the inauguration.   Once that person has been approved by the Senate, they will need to work out their strategy.   Trade relations with China will be an early priority.

It is the case that there have been quite detailed technical negotiations between the UK and the US and it is understood that draft chapters of a potential agreement have been mapped out.   However, the issues have always been political rather than technical.  If there is political agreement, the legal language to fulfil it can be provided.  The biggest obstacle here is the effect of Brexit on the Good Friday agreement, about which Joe Biden has expressed concern.   Biden identifies strongly with his Irish heritage.   Asked a question by a BBC reporter, he replied: ‘BBC?  I’m Irish.’   Ireland is also a concern for the House of Representatives which would have to approve any agreement and which still has a Democrat majority.

It is unlikely that a UK–US deal will be reached before the president’s 'fast track' authority to sign trade deals (formally Trade Promotion Authority, TPA) expires on 1 July 2021. Its absence makes the congressional approval procedure much longer and more troublesome. Biden may find that he has more important things on which to use his limited capital with Congress than trying to renew TPA.

Even if an agreement was reached, there is no reason to suppose that it would be any more favourable to UK agriculture than one reached under President Trump.    Nick Clegg claims that Joe Biden said to him ‘very unsentimentally – in that folksy way he does – “‘We are not going to sign anything that the chicken farmers of Delaware don’t like!”’   Delaware is one of the largest chicken producing states in the US and the product is washed with chlorine.

Joe Biden’s personal links with chicken farmers’ aside, there are more fundamental reasons why any agreement is likely to favour US agricultural interests.    Unlike the UK, where Defra has a multitude of tasks and does not necessarily treat farming as a priority, the US Department of Agriculture is a powerful department with a focus on farming that has the lead on the agricultural dimension of trade negotiations.   It is not yet known who the new Agriculture Secretary will be, but they are likely to have some kind of farm industry background.    

They will be backed up by the agriculture committees in each house of the Congress that usually have a preponderance of members from areas that have significant agricultural businesses, while the agribusiness lobby remains strong.   In summary, any agreement that is reached will reflect US agricultural interests, particularly given the willingness of the UK to make sacrifices on agriculture to make gains elsewhere.

As far as Brexit more generally is considered, Biden has made it clear that he thinks it was an historic mistake and he would have voted against it if he could have done.   There is wider disappointment in the US because the UK could be relied upon to bring a perspective to EU discussions that took account of American viewpoints.    However, Brexit will be completed one way or another before Joe Biden is inaugurated and his views are likely to be peripheral to any subsequent discussions between the UK and the EU.

New consultation on pesticides

Defra has launched a consultation on a new national pesticides action scheme: https://consult.defra.gov.uk/pesticides-future-strategy/sustainable-use-of-pesticides-national-action-plan/

One of the interesting aspects of the plan is the lack of reference to the European Union and the switch away from participation in EU regulations.   However, if the UK gives approvals to products that are not permitted in the EU that could affect exports.

The section on biopesticides is relatively downbeat: 'The use of biopesticides supports IPM and can have a number of benefits including reduced impact on some non-target organisms and humans, resistance management, and minimising residues in food. Yet, biopesticides are generally more expensive for the user, and require a greater need for specific technical guidance, for example on storage and application. It is important to note that biopesticides do not inherently pose less risk to human health and the environment and, as such, should be assessed and utilised with the same care applied to chemical pesticides.'

The case for regenerative farming

An interesting article by an experienced farmer in the Weekend Financial Times on how farmers are caught in a vicious cycle of low margin, environmentally damaging farming underwritten by a subsidy regime which is to be phased out.

John Cherry noted that the price of wheat is much the same as when he started farming in the 1980s, but input prices have shot up.  'Yields are a bit higher, but not enough to keep the margin remotely generous. Many livestock farmers are similarly trapped in a high-input/high-output/low-return system.'

On his farm they have adopted a regenerative approach that focuses on improving the soil rather than chasing yields.   'Healthy soil will absorb all but the heaviest downpours of rain, which can prevent floods and store water to keep plants growing through droughts.  It also enables farmers to grow nutrient-dense food with a minimum of artificial inputs.'

He co-founded the charity Groundswell to explore ways in which farmers can work with nature in a profitable way: https://groundswellag.com/about/

Farming's brave new world

Defra secretary of state George Eustice has set out government plans for the future of farming after Brexit: https://www.gov.uk/government/speeches/path-to-sustainable-farming

There is a lot of detail to absorb, but the key question is whether farms will be able to stay in profit.

NFU president Minette Batters commented on the agricultural transition roadmap: 'The rate at which direct support reductions will take place, which we understand will not be applied in other parts of the UK, leaves English farmers with significant questions. These payments have been a lifeline for many farmers especially when prices or growing conditions have been volatile and will be very difficult to replace in the first four years of this transition. Can Ministers be sure that new schemes will be available at scale to deliver redirected BPS payments?'

Government seeks to reduce emissions from urea fertilisers

The government has launched a consultation today seeking views on reducing ammonia emissions from solid urea fertilisers used for growing plants and crops.

Ammonia emissions are harmful to natural habitats and our rivers and lakes, as well as to human health, with 87% of the UK’s ammonia emissions coming from farming. The Government has committed to reducing ammonia emissions by 8% of 2005 levels by 2020, and a 16% reduction by 2030.

Taking action on solid urea fertilisers has the potential to reduce pollution caused by:

• Ammonia reacting with other pollutants – nitrogen oxides and sulphur dioxide – to form particulate matter (PM2.5) which is harmful to cardiovascular and respiratory health.
• Nitrogen deposited on sensitive habitats such as peat bogs. This leads to excess nitrogen in soils that damages the growth of certain plant species.
• Nitrogen leaching through the soil and surface run-off which pollutes water courses, causing harm to plants and animals and impacting on water quality.

The consultation presents three cost effective options:

• A total ban on solid urea fertilisers
• A requirement to stabilise solid urea fertilisers with the addition of a urease inhibitor - a chemical that helps slow the conversion of urea to ammonium
• A requirement to restrict the spreading of solid urea fertilisers so they can only be used from 15 January to 31 March While each of these options will support the Government’s commitment to reducing ammonia emissions, a ban on solid urea fertilisers would achieve around 31% of the ammonia reduction target by 2030.

Reducing ammonia emissions will significantly reduce nitrogen deposition to land and in turn help reduce damage to peat bogs, which are an important carbon sink, thereby helping to tackle climate change.

Up to half of the fertiliser evaporates, causing ammonia emissions that react with other pollutants to produce fine particles whose microscopic size allows them to penetrate the lungs and enter the bloodstream, making them the most dangerous form of air pollution.

Public Health England attributed the serious smog episode in London in April 2014 partly to agricultural ammonia emissions.

The fertiliser also causes excess nitrogen in soil which promotes growth of brambles, nettles and hogweed that then crowd out wild flowers like harebell and bird's-foot trefoil. Almost nine out of ten designated wildlife sites in England are damaged by excessive nitrogen.

Defra expects farmers to switch to using more ammonium nitrate fertiliser, which is dearer but causes less evaporation and which crops absorb more efficiently.

The ban is expected to cost farmers £132 million up to 2030 and result in an additional 388,000 tonnes of ammonium nitrate being required per year, according to Defra’s impact assessment.

Clear Air in London stated: 'Many more technical measures and lifestyle changes will be needed if we are to reduce ammonia emissions from cattle and agriculture generally which are a major cause of particle air pollution episodes in spring.'

Vertical farming can be over hyped

The coronavirus pandemic has stimulated interest in vertical farming given supply change disruptions and labour shortages.  Crops are grown in stacked indoor systems without soil and under artificial light.

About $1.8bn in investment has flowed into the sector since 2014, according to Dealroom.  However, as with anything that is proclaimed the next big thing, some caution is necessary among the hype and boosterism.

The sector remains largely unprofitable and tiny.   According to Rabobank analyst Cindy van Rijswick it occupies the equivalent of 30 hectares of land worldwide compared to half a million hectares for greenhouses and 50m hectares of outdoor cultivation.

High initial capital investment and running costs make it hard to make a profit.   Electricity bills for lighting and ventilation can be high and specialised labour is required.   This leads to a focus on higher value leafy greens, salad greens and herbs.  Vertical farming won't be used for commodities like wheat and rice.

Even so, Nordic Harvest has linked up with Taiwan's YesHealth group to Europe's biggest vertical farm in Copenhagen.   They claim they will be profitable in their first year, although I doubt whether there are significant economies of scale.

Because production can take place in urban areas food can be produced close to consumers improving freshness at point of sale.  However, consumers can be resistant to change in food production and may believe that produce grown with soil and sunlight tastes better or is even healthier.   There has been a history of yield being placed ahead of taste in greenhouses as in the tomato 'water bomb' scandal.

It is very much a niche method of production, albeit it one with growth potential.

Changes in EU climate change targets will affect agriculture

 Alan Matthews discusses the implications of the EU's 2030 climate target plan for agriculture: http://capreform.eu/commissions-2030-climate-target-plan-proposes-radical-changes-in-the-rules-governing-agricultural-and-land-ghg-emissions/

He notes, 'For the EU27, agricultural emissions are currently 18% of Effort Sharing Reglulation (ESR) emissions; this share would increase to 40% under the second option in the Commission’s Impact Assessment. As such, the national ESR reduction target would become almost a de facto reduction target for agriculture as it would no longer be possible to avoid reductions in agricultural emissions if the national reduction target were to be met. It would also have very different consequences for individual Member States.'

There are some complex issues and a short window of opportunity to influence policy.

Farmers leaving is not necessarily bad news

Economist Sean Rickard has warned that one in three farms could be driven out of business in five years in the event of a no deal Brexit.   Those most at risk were smaller, full time producers.

One has to be careful about the distinction between farmers and farms going out of business.  Some farmers could switch to part-time farming by taking on off farm work, although the way in which they farmed might change.

Other farmers might decide to leave farming.  Their farms might be taken on by new entrants or absorbed into larger existing farms.

Individual farmer decisions will be influenced by such factors as their debt load and whether they have a successor.   However, there is a case for enhancing early retirement schemes for an ageing farmer population.

Replacing older farmers by younger ones could boost innovation and productivity.

New form of help for farmers

The Government is trying to devise a system of temporary subsidy payments for farmers to meet the gap between the phasing out of the Basic Payment and the arrival of the new Environmental Land Management Scheme.   That is going to be piloted in 2021 and rolled out nationally in 2024.

An interim system of payments called the Sustainable Farming Incentive is to be made available from 2022.  This will include help to improve productivity as well as to farm sustainably.

Defra research shows that subsidies make up 61 per cent of profit for the average English farm.   Some of the biggest sums go to large scale farmers.  Sir James Dyson revealed in an interview over the weekend that he receives £2.9m in Basic Payment subsidies for his farms.

Farmers are concerned that multiple schemes may be administratively complex leading to delays in payments as has happened with Countryside Stewardship.

Big banks pull out of commodity trade financing

In Monday's Financial Times Rana Foroohar discusses changes in financing in the food chain.  She emphasises the possible implications for food prices, but I am more concerned about the potential for greater concentration and domination by big corporates.

Big banks are pulling out of commodity trade financing or scaling it back.  There have been a variety of scandals involving financial fraud.   Leverage and volatility in the commodities sector make it a particularly risky area for large banks do business (providing finance to farmers is another matter altogether as land is a very secure and asset that can be cashed in if the need arises).

The retreat of the big banks may hit agricultural producers and distributors, as well as grocery chains and SMEs that form a crucial part of the global food supply chain.   Professor Michael Greenberger of the University of Maryland is worried that if second or third tier producers cannot get funding or are forced to pay higher rates to shadow lenders we could see a food price surge.  (To some extent, certainly in the UK, this would be offset by the fierceness of retail competition).

Already, after Covid-19, the big companies were getting bigger.   There could now be bigger gains for big global commodities traders such as Vitol Group or Ametican agricultural giants including the secretive Cargill.

Monopoly power in the food chain can create supply gluts in some areas (forcing down producer prices) and shortages and higher prices in others (hitting the consumer).  A handful of large companies have controlled areas such as meat packing and grain production.   It may look economically efficient, but it is potentially fragile in terms of food security.

What is real food security?

The terms 'food security' and 'self-sufficiency' are often used interchangeably, particularly by farm union leaders arguing for high levels of domestic production underpinned by government subsidies.

But as agribusiness consultant Carl Atkins notes in Farmers Weekly food security and self-sufficiency are two very separate things and should not be confused.  'Food security is the state of having reliable access to a sufficient quantity of affordable and nutritious food,' he said.

Being 100 per cent self-sufficient in a particular foodstuff could actually be risky if there was an interruption to domestic production. 

The current self-sufficiency figure for the UK is 64 per cent, having peaked at 78 per cent in 1985.  However, that figure does not take account of tropical foods we cannot produce in the UK like bananas.  If we take account of them, the figure is 77 per cent.

Part One of the National Food Strategy points out that the UK has been a net importer of food since the 1830.  Part Two will examine whether there is an optimal level of self-sufficiency the UK should target, whether in aggregate or for a particular sector.   Hopefully not: for me, it looks too much like Soviet style planning.

There was also an outbreak of level-headed thinking in the correspondence columns of Farmers Weekly.  A correspondent notes that for many years there has been talk of value added production, but the industry focuses on commodities.   The obsession with benchmarking and least-cost production emphasises this point.

A window of opportunity for biocontrol?

 I have an article on this theme on a new website: https://elc-insight.org/biocontrol-opportunity/

Weather hits summer harvest

This summer's harvest in the UK has been hit by poor weather.  After a sodden autumn, a winter that was warm and wet and an exceptionally dry spring the recent period has seen a mini heat wave which stopped any more growth.  This was then followed by torrential rain which flooded fields and flattened crops.  It is also needs to be borne in mind that there was a reduced planting area last autumn.

The NFU has claimed that it will be the worst harvest in 30 years.   The ADHB were more optimistic, forecasting an average decline in yields of 10 per cent.   In any event it looks like the UK will be a net importer of wheat, around four million tonnes.  Wheat production is expected to be below 10 million tonnes, well below the five year average of 15 million tonnes.

Farmers will not be compensated for lower yields by higher prices as there are plentiful supplies of wheat and maize elsewhere.  There have been strong yields in Russia's central and Volga regions.

As weather conditions become hotter and wetter in response to climate change, farmers are turning to alternative crops such as soya and maize.  Soya is a legume native to south-east Asia.  It is mostly used as an animal feed.  Rising meat consumption by the Chinese middle class has driven up its use.  China imports 105 million tonnes of soya a year.   

Some 5,500 acres are currently being cultivated by around 150 farms and that is expected to increase to 10,000 acres next year.  It is open to question whether there are varieties that will do sufficiently well in the UK climate.

The answer no longer lies in the soil

The Covid-19 pandemic has given a big boost to advocates of vertical farming because of the simplicity of its supply chain.  Vertical farming is the practice of growing crops in stacked layers without solar light.   It can be housed in buildings, shipping containers, underground tunnels and even abandoned mine shafts.  Vertical farms use soil-free growing techniques and stack crops in specially designed beds and trays.

The technology

It makes use of LED lighting to provide different wavelengths of light, according to crop and growth stage need.  The sector received a boost from advances in LED lighting.  The lights can be used to change the way plants grow, when they flower, and how they taste.

The LED lights can be positioned between plants and produce hardly any heat radiation.

The benefits

Advocates say that vertical farming offers a means of guaranteeing yields and reducing the industry's environmental impact while improving the supply of safe, healthy and nutritious food.   There is lower water and nutrient use.

Crops can be grown year round with minimal human intervention.   It can be run entirely on robotics.  This is an important consideration when reliable labour is scarce and its cost is rising.

There is a reduced need for transport and a reduction in food waste because crops are of a more uniform quality.  Reduced fertiliser use means reduced greenhouse gas emissions.

Downsides

In a field, the sun comes free.  Vertical farms are energy intensive and have high electricity bills,   However, there are improvements under way in LED lighting.

It also requires a high initial capital investment and the sector has been littered with bankruptcies.

It is only suitable for a limited range of crops.   It makes sense to grow high margin crops.  Examples are leafy greens, baby leaves like pak choi and herbs such as basil.  It is of no use for staple commodities like bulk grains or cereals.

The sector

Worldwide it was worth £1.72bn in 2018 but is predicted to rise to £9.84bn by 2026.   Japan and the United States have been leading the way.

Intelligent Growth Solutions have a demonstration farm near Dundee.  The company raised £7m from three venture capital firms and the Scottish Investment Bank.   They sold their first vertical farm in July to an Aberdeenshire venture backed by a founder of craft brew business BeerDog

Ocado has invested £17m in the sector.  It has a joint venture with US firm 32ha and Priva Holdings in the Netherlands known as Infinite Acres.  It has also taken a 58 per cent stake in Lincolnshire's Jones Food Company.

In London Growing Underground provides microgreens and salad greens beneath the streets of Clapham.

Advocates argue that vertical farming is disruptive in the true sense of the word as it is changing conceptions of what the food system should be like.

Potato growers have had their chips

Once it would have been down to government to help out a sector in trouble.  However, with the UK's €1bn potato growing sector hit hard by extreme weather and Covid-19 it is their largest customer, McCain, that has stepped up to the plate.

It is worth noting that potato production (other than for starch) was always outside the CAP and therefore much more influenced by supply and demand.

The closure of restaurants and fast food outlets left a potato surplus of almost 200,000 tonnes in March, putting a downward pressure on prices.  Prior to lockdown prices of £200 to £300 a tonne could be achieved, but they then slipped back to £100 to £150 a tonne.

The hardest hit growers have been those who sell on the spot market, such as those selling for 'fresh chipping' at food outlets.

McCain buys 15 per cent of the UK potato crop, normally on one year contracts.  It is now going to offer three to five year contracts.  It also offering grants for investment in harvesting capacity, including technology such as irrigation and harvesters that can handle very wet weather.  85 growers have applied for these grants.

Recent poor harvests have been among the worst in four decades after drought in 2018 and floods in 2019,   McCain thinks this is down to climate change.  They consider they have to act to build a sustainable supply chain.

Hard cheese on trade deal

Britain's trade deal with Japan has been thwarted for the time being by a disagreement over the tariff on stilton cheese, exports of which to Japan are worth just £102,000 a year.   A milder form of the cheese is made for Asian markets.

Under the existing EU deal with Japan, Japanese tariffs of 29 per cent on hard cheeses such as cheddar will be phased out by 2033.  For other cheeses such as stilton only a quota of exports would be tariff free.

International trade secretary Liz Truss wanted to demonstrate that the UK could get a better trade deal under Brexit than that agreed with the EU, even if the gain was a small one in economic terms.

In 2014 she made a speech to the Conservative Party conference claiming that the fact that Britain imported two-thirds of its cheese was a 'disgrace'.

Lobbying victory for NFU

The NFU is pleased with the composition of the new Agriculture and Trade Commission.  It includes representatives of the English and Welsh branches of the NFU and the farmers' unions in Wales, Scotland and Northern Ireland.   There is also someone rather oddly described as a 'lamb farmer' and representatives of the food and drink sector: https://www.gov.uk/government/news/trade-and-agriculture-commission-membership-announced

In principle, this is a considerable lobbying victory for the NFU, but much will depend on how much influence it has on trade deals, not least that with the United States.

Its key role is to advise on 'Trade policies the Government should adopt to secure opportunities for UK farmers, while ensuring the sector remains competitive and that animal welfare and environmental standards in food production are not undermined.'   

So far, so good, but is role is advisory and the international trade department is likely to become part of a larger Foreign Office before long.    It also does not specifically mention food standards which have been one of the main areas of contention.

A correspondent has drawn my attention to the presence of Sir Lockwood Smith on the Commission.  He was formerly the High Commissioner for New Zealand in London.  Perhaps he is there to argue for the merits of zero subsidies and free trade, albeit his country is currently not admitting anyone who is not a national.

There is also a row brewing with the Scottish Government about common standards in the UK 'internal market' which may end up in court.

 

The challenge to arable farmers

I would just like to draw the attention of readers to an important new article just published online by Euro Choices on 'Post‐Brexit Policies for a Resilient Arable Farming Sector in England'.

This has been a competitive sector but, as the article points out, it faces challenges on a number of fronts ranging from the phasing out of subsidies to climate change.

One of the interesting aspects of the article is the specification of the range of sources from which farmers draw information.

Eustice wins trench warfare

Defra secretary George Eustice has won his battle with international trade secretary Liz Truss over protecting farmers from imports produced to lower standards than in the UK.  As so often the case, the devil is in the detail. 

An agriculture and trade commission will be set up to consider policies the Government should adopt in free trade deals to ensure UK farmers do not face unfair competition which would undermine high animal welfare and production standards.

Although the commission will be only advisory, it will report to Parliament.  Going against its recommendations would be awkward for the Government.   However, there remains a strong imperative to get a trade deal with the US and this will not be possible without concessions on agricultural trade.   President Trump is particularly reliant on votes from farm states.

It will be interesting to see who the chair.  I would expect the membership to include a working farmer with NFU connections and one of the few academics with expertise in international agricultural trade.

Don't resurrect the milk marketing board

Some dairy farmers have been hit hard by the slump in the liquid milk market after restaurants and cafes entered lockdown.  Some more milk was consumed at home, but not enough to make up for losses in the catering sector.  Some emergency help has been given to dairy farmers by the Government, but it has been criticised for not hitting the spot:https://www.nfuonline.com/sectors/dairy/dairy-news/dairy-response-fund-opens-for-applications/

Some farmers have been agitating for the return of the Milk Marketing Board.   The story of its demise is a bit more complicated than has been made out, e.g., in Private Eye..  It wasn't just down to the wicked EU - who rightly saw it as a state sponsored cartel.    Mrs Thatcher didn't like it, but Peter Walker defended it in England so the Scottish boards went first.

However, its demise was also favoured by the bigger dairy farmers who felt they could extract a better price if they weren't compelled to sell to a monopoly.   Remoter, smaller farmers tended to favour it because it ensured that they did have a market for their milk.

I wrote more about milk marketing than was good for my sanity, but here are a few key points:

• The price for manufacturing milk varied according to its final use, e.g., chocolate crumb v. yogurt. The milk supplied wasn't any different, but the price for manufacturing milk was lower than for the liquid market (roughly half of total output).  It's as if you charged more for steel if it was used in a Jaguar rather than a mini!
• Prices were determined by the Joint Committee in which each side - farmers and processors - had one vote.
• The franchise for the elections to the board rested with the cows, ten cows got one vote - the idea was to give bigger farmers more of a say.   Concerns about 'bovinisation' led to them being counted through occasionally.
• A big bureaucracy was necessary to operate the system.  Nice people, but as soon as they saw you expressing an interest, they tried to coopt you to their way of thinking.  They had the most to lose from dissolution.

Pesticide protections should not be given away in trade talks

UK consumers are likely to be exposed to larger amounts of more toxic chemicals in their food if trade negotiators from the US have their way, warns a new report out from the Pesticide Action Network (UK).  You can read the key findings here: https://www.pan-uk.org/toxic-trade/#key_findings 

The warning comes alongside new YouGov polling which reveals that almost three quarters (71%) of the British public want the UK Government to resist US attempts to overturn bans on pesticides, even if this means the “best” trade deal cannot be reached.  

Authored by Pesticide Action Network UK (PAN UK), Sustain and trade expert Dr Emily Lydgate, Toxic Trade highlights that a rise in exposure to hazardous chemicals could be unavoidable for UK consumers because pesticides are not mentioned on food labels.   

While far from perfect, the UK currently has some of the most stringent pesticide regulations in the world, meaning that many agricultural products produced elsewhere can’t be sold here.  However, concern is mounting that in the wake of the UK’s exit from the EU, trade deals currently under negotiation with the USA, and planned imminently for Australia and India, will drive down UK pesticide standards.  This not only risks damaging public health but also the environment as trade negotiators push the UK government to allow currently banned hazardous pesticides to be used in UK farms and gardens.

  

The YouGov poll reveals high levels of concern among consumers, with 71% of those surveyed concerned that a US trade deal will mean larger amounts of pesticides in their food; 79% concerned about impacts to health if UK Government caves to US pressure to lower pesticide standards; and 77% worried about negative impacts on the environment.  

Josie Cohen, Head of Policy and Campaigns at Pesticide Action Network, said: 

“Much attention has been paid to the dangers of ‘chlorinated chicken’, but the UK public is equally concerned about weakening pesticide protections. We know that US negotiators have our pesticide standards firmly in their sights, and with the talks happening behind closed doors the public has no way of knowing if health and environmental protections are being traded away.”  

Vicki Hind, farm campaign coordinator at Sustain said 'If UK farmers are forced into using pesticides to compete with a flood of cheap food imports, their exports will no longer meet EU standards and they'll lose one of their key markets.'

Big scale farmers feel hard done by

A new report from the Commercial Farmers Group examining the role of commercial agriculture in the UK says farming has the potential to solve sustainability challenges, generate employment and boost the post-pandemic economy. Yet it warns that commercial farmers are being systematically ‘written out’ of emerging policy in the rush to push environmental enhancement above all else.

‘Commercial Farming: Delivering the UK’s new Agriculture Policies’ has been released today by the Commercial Farmers Group to coincide with the second reading of the Agriculture Bill in the House of Lords. As well as laying out the areas farming can impact positively, it argues that UK farmers should be ready and willing to compete with food imports – provided there is clear labelling identifying differences in production standards.

James Black from the group, who runs the family farming business producing pigs and arable crops in Suffolk, explains that commercial farming is important as fewer than 10% of farming businesses currently produce over half the UK’s agricultural output.

“These businesses are also ideally-placed to stimulate local economies, support wider industries and address pressing problems such as use of finite resources, greenhouse gas emissions, climate change and biodiversity decline. However, they can only do this if allowed the chance,” he says.

“Unfortunately, UK history is littered with the results of so many great aspirational concepts which have been poorly delivered – because policy makers have not fully engaged with the people most involved in the implementation. We must avoid food and farming becoming a casualty of this too.”

Mr Black says commercial farmers should be seen as the solution, not ‘the enemy’. With their efficiency based on evidence-based decision making and best practice, they structure their operations to make optimal use of their natural resources – and where they are already engaged in delivering public goods, they do so with accountability towards the outcomes.

“In short, they can quickly bring about change through capability, data, scale and technology, to meet changing market demands,” he adds.

“This is the thrust of our report and why our group wants to be involved as the details for implementing new agricultural policy are identified – so that real public goods can be achieved alongside the imperatives of food security and economic viability.”

The report provides examples of areas where commercial farming can help to improve the success of future farming policy, such as: the ability to use resources efficiently with fewer emissions; provide land and capital to invest in renewable energy technologies; and deliver land improvement and biodiversity projects. These actions can stimulate rural development and the contribution of Gross Value Added arising from the food and drink sector. 

You can access the report here: https://www.commercialfarmers.co.uk/wp-content/uploads/2020/06/Commercial-Farming-Delivering-the-UKs-new-Agriculture-Policies-June-2020-low-res.pdf

British workers challenged by picking tasks

In the past I have undertaken quite a lot of work which involved me talking to growers in the glasshouse and field vegetable sectors.  This included the work I did on biocontrol (ongoing) and a Defra funded project which looked at polytunnels among other issues.

I have seen this work being done and even with picking rigs in the field it is arduous, repetitive and requires high levels of concentration.

Everyone I interviewed was of the clear view that it was no use taking workers from the local unemployed pool.  They didn't turn up on time; they were less productive; and they soon gave up.  Anecdotally, this seemed to be confirmed by a programme that the BBC filmed in Wisbech.

It is therefore no surprise to learn from the Financial Times yesterday that although a local recruitment drive has been relatively successful, productivity among these workers is lower and in the case of one major grower a third have already left.  Half were not able to achieve the required picking rates.

This is a low margin business in which labour can account for 70 per cent of the costs.  According to the Pink 'Un net operating margins are just 9.5 per cent.

Normally there are 70,000 to 80,000 migrant workers in the sector.   A seasonal workers scheme this year let in 10,000 temporary non-EU farm workers.

Some crops such as asparagus have already been left unpicked this year because of the pandemic.  In the longer run, supplies could diminish and prices go up.   One doesn't have to be too impressed by food security arguments to realise that there is a case for having a good local supply of healthy fruit and vegetables.

Congratulations to Judith Evans who is a new FT reporter covering agriculture but has done some excellent reports.   I have spoken to her and she asks good questions.

Britain dangerously dependent on two countries for its food supplies

I have always been sceptical about food security arguments for farm subsidies, particularly as they have been framed by farming organisations.   They have always seemed to me to rather Soviet style in their domestic production targets and I am not fan of autarchy.  My classic response was that one should only worry about security issues if one was reliant on just one or two suppliers.

John Maynard Keynes is claimed to have said 'When the facts change, I change my mind' or something like that.  Presumably he didn't change his mind about supporting Aston Villa or disliking Ramsgate!   

I have been influenced by an important new study by the distinguished international political economist Tony Heron in.which he argues that Britain is 'dangerously dependent' on fruit and vegetable supplies from a small number of European countries with 60 per cent coming from the Netherlands and Spain.  The food system is not as global as we often suppose.

The Netherlands does, of course, draw some of its supplies from elsewhere because of its entrepot role. Many large scale fruit and veg producers up sticks and work from Spain in the British winter.  There is less carbon impact from growing tomatoes in Spain than using heated greenhouses on the Sussex coast.

You could read his article for yourself here: https://www.nature.com/articles/s43016-020-0097-7

It certainly has implications in current circumstances given the pinch points provided by the Channel ports which could become a more serious issue after a no deal Brexit.  It also has implications for migration policy in relation to seasonal agricultural workers.

What I hope does not happen is that the article is used to back up the argument for blunt policy instruments of the kind represented by the EU's Basic Payment.   We need to be much more sophisticated and targeted in our policies outside the EU.

Battle of the lightweights

One of the big concerns of UK farmers is that at the same time as farm subsidies are reduced, the UK Government will lower tariff barriers to agriculture and food products in order to conclude trade deals that are beneficial to other sectors.

Earlier in the month the usually reliable Financial Times learned from government officials that the Department of International Trade was preparing to offer a 'big concession package' to US negotiators in the coming months to reduce the cost of some agricultural imports. 

It was hoped that this would ease the path to a deal with the US.   The aim was to secure a deal while the Trump administration was still securely in office as it was felt that an incoming Democratic administration would take a tougher stance.

Defra officials were reported by the Pink 'Un to be concerned that reducing tariffs could be 'the thin end of the wedge' leading to concessions on animal welfare standards.  UK farmers generally adhere to high standards and can be undercut by countries with lower standards.

A long-standing complaint of the US is that its beef, chicken and pork has been shut out of European markets because of high tariffs and restrictive regulations.   These are, of course, sectors that are already in some jeopardy in the UK.

Not all Conservatives are enthusiastic about selling out to the Americans, although deteriorating relations with China have shut off one strategic option available to 'Global Britain', i.e., cosying up to the PRC in the manner of Dave Cameron and George Osborne.

A battle of the lightweights has been taking place between Defra secretary George 'Useless' Eustice and Liz Truss, the international trade secretary.   Someone has been feeding stories to the Daily Mail and the Daily Express claiming that she was set to betray UK farmers despite being a Norfolk MP.

However, it now appears that Boris Johnson has come down on George Eustice's side in what had become a Cabinet split. The intervention of 'Mr Fixit' Michael Gove on Eustice's side may have been decisive.     Johnson may have been fearing another dagger in his back, but his partner's interest in animal welfare issues may have played its part.

It was alleged in court that Carrie Symonds intervened to stop an extension of a badger cull to Derbyshire, but the NFU lost its attempt to secure a judicial review.

Life was much simpler for Boris Johnson when he simply had to worry about traffic problems in London rather than badger culls and 'Hilton beef'.

Bozza declared 'We must not let our farmers down.   One of the reasons for leaving the EU is we can do things differently and better on things like animal welfare.'

Sharp fall in lamb prices

Coronavirus has seen lamb prices fall by as much as 25 per cent, although there has been a steadying of prices. However, the 30,000 lambs sold last week was a fifth of the level normally sold at this time of year.

Sales of meat to restaurants and fast food outlets disappeared along with large parts of the export market that takes 25 per cent of UK production. The Rungis food wholesale market near Paris which deals with a large portion of the UK export trade is shut.

Rerouting meat to retailers is not easy as processors used to dealing with the food service industry lack the equipment to cut and package meat for retail. In any case, consumers are switching to cheaper meats such as chicken. Meat intended for more expensive cuts is being used for mince.

The National Sheep Association has called for deficiency payments to make up the gap between a baseline price and the market price. However, the budgetary cost of this policy instrument is always unpredictable.

Some have argued that the disruption to supply chains will give a higher priority to food security as many farmers would wish. However, attention is likely to focus on logistics rather than the point of production.

The sheep industry was already in poor shape before the virus struck. Many farmers also fear a no deal Brexit which could lead to the imposition of tariff barriers on their exports to European markets.

Collapse in milk demand hits dairy farmers

The closure of restaurants, cafes and canteens has hit demand for milk. Some 10 million litres of milk would normally enter the food service industry. Retailers are absorbing about half of that, with consumer stockpiling cushioning the impact at the beginning of the lockdown.

However, there is now a surplus of 5 million litres out of a total daily output of around 35 million litres after people stopped buying milky coffees and other dairy products they would normally consume away from home.

As a consequence some farmers are dumping milk after processors halted collections. Spot wholesale milk prices have fallen from 20p a litre to 15p during the week. The National Farmers Union estimates that 2,000 dairy farmers are under severe financial pressure.

Dairy farmers are asking for state aid. It is unclear what form that would take, although the NFU has made some suggestions, including cash grants of up to £25,000 under the Retail and Hospitality Grant Scheme: Saving iconic sector

The NFU has sought a meeting with the Defra secretary, George Eustice.

Farmers need biopesticides

In a recent article in Farmers Weekly Sean Smith the CEO of biopesticide developer and supplier Eden Research states: 'The British farming community has expressed serious concerns about the clampdown on conventional pesticides, viewing the bans as a threat to productivity. Pesticides are often a critical input and without them, commercial yields can be significantly affected.'

'This is why alternatives to conventional chemistry are essential, along with more integrated approaches to pest and disease control. As things stand, however, the banning or restricting of existing, traditional pesticides is happening at a much swifter rate than the approval of alternative chemicals and new biopesticides, which are pest control formulations derived from natural materials, such as minerals, bacteria, plants, or animals.'

'Farmers are therefore facing a declining choice of crop protection products, with few alternatives approved and ready. This imbalance is making growing conditions more challenging. To counter this, there is a need for regulators, such as the UK’s Chemicals Regulation Directorate, to facilitate quicker approvals for new alternatives.'

'Despite the regulatory lag, sustainable alternatives are becoming available and being applied to all facets of farming. Allowing new sustainable biopesticides to enter the market will help make headway towards greener farming practices, meeting the ethical expectations of UK consumers.'

This is a topic I have worked on with plant scientists for over a decade and I have recently completed a book chapter with Roma Gwyn of Biorationale looking at global developments and in particular the regulatory framework within the EU and whether it inhibits or facilitates adoption of biological alternatives.

Our conclusion is that the agenda for more effective forms of regulation will only be fulfilled with sufficient political support. There is greater interest in biological technologies than in the past and an increased recognition of the contribution they can make to environmentally sustainable solutions to plant protection. This reflects a number of factors, including greater effectiveness on the part of the industry representative body, the IBMA, including a willingness to build coalitions with environmental groups.

It also reflects the greater involvement of major agrochemical companies in the sector as market opportunities improve. However, public knowledge and understanding of biological technologies remains limited and this means that there is no substantial constituency of public support for their greater use. This in turn influences the priority that political decision-makers give towards improving the responsiveness and speed of regulation that allows new products to enter the market.

Chancellor targets farmers' fuel tax break

Hints are increasingly being dropped that the Chancellor might target the 'red diesel' tax break available to farmers. Ending the overall freeze on fuel duty could be politically difficult, but the £2.4bn revenue foregone on construction and farming vehicles could be an attractive target.

Red diesel (so called because it is coloured red in an effort to avoid fraudulent use) has a duty of 11.1p a litre against 57.7p for standard diesel used by motorists. It is only supposed to be used on the farm itself for machinery such as tractors and combine harvesters. It is not supposed to be used on the highway. It is used by airport vehicles and most freight trains run on it.

It was originally thought that just the construction industry and perhaps airports would take a hit, but that might be difficult to enforce in practice. I would have thought it more likely that the reduced duty will be phased out rather than eliminated overnight. However, it will be another blow to farmers reeling from the phasing out of direct payment subsidies.

The Government launched a consultation on the subject last year which details its long history and the issues that have arisen: Red diesel

Farming not important says Treasury adviser

Treasury adviser Tim Leunig has said that Britain could do without its fishermen and farmers: Farming and fisheries are not important

Whilst he was expressing a personal view, this will reinforce a fear already held by farmers that the Government will give a low priority to their welfare in trade talks.

The NFU does tend to overplay food security arguments, given that there is a variety of suppliers, but a country with plenty of agricultural land would look odd if it did not grow some of its own food.

Is it useless Eustice?

Despite his farming background new Defra secretary George Eustice got a rough ride at the NFU conference last week when he was booed by angry farmers. Farmers Weekly commented that 'Reassuringly, Mr Eustice already owns a pair of wellies, and knows his way around a farm.' In fact his practical farming involvement was some time ago and I own some wellies and make farm visits quite often, but that doesn't qualify me to be a Defra minister.

As Farmers Weekly admitted, the Defra secretary has tasks other than being a MAFF style spokesperson for farming. (Anyone interested in the history of MAFF and Defra's relations with farmers can have a copy of an unpublished paper I wrote on the topic). FW noted, 'Questions have also been raised over whether he is the big hitter farming needs … Whether Mr Eustice can hold his own against Cabinet heavyweights remains to be seen.' More generally they said, 'Too often in the past the Department has been a dumping ground for ministers of mediocre ability.'

Farmers were particularly annoyed that Mr Eustice was not prepared to relax the notorious 'three crop rule' other than through individual applications claiming force majeure.NFU president Minette Batters said farmers were hugely frustrated. 'We have left the EU, half the country is under water and [yet] we are still going to abide by the three-crop rule and process thousands of force majeure applications. It just seems absolutely extraordinary.'

However, we are still in the transition period and Mr Eustice has no powers to set aside what he rightly described as a 'barking' rule despite shouts of 'rubbish' at the conference. To me it is a classic example of the CAP's ability to come up with poorly designed policy instruments: the relationship with the intended outcome (improving biodiversity) was poor and the transaction costs high. The rule requires farmers with more than 30 hectares of arable land to grow at least three different crops.

Perhaps more importantly, he declined to commit the Government to upholding existing UK food standards in future trade deals with countries, such as the US, that have weaker regulations. 'I can't provide any such assurances,' he said.

A House of Lords amendment to the agriculture bill would bar the Government from signing trade deals that do not require imported foods to meet UK standards on food safety, animal welfare and the environment.

Farmers launch climate change initiative

The Yorkshire Agricultural Society, where I served on its innovative Farmer-Scientist Network for many years, has launched a #Farm4Zero campaign on climate change. This is a very welcome initiative.

The YAS states, 'The campaign aims to energise farmers and rural businesses about how they can respond to the climate change challenge as British agriculture seeks to reduce its carbon footprint. Although agriculture accounts for just 9% of the UK’s greenhouse gas emissions, compared to proportionally higher impact sectors such as transport (23%) and industry (21%), farmers are acutely aware of the need to take action.' [Well, at least some are].

The Yorkshire Agricultural Society is determined to focus minds on the positive opportunities that exist as British farming seeks to meet its own target to become net zero in greenhouse gas emissions by 2040 – ten years ahead of the Government’s 2050 target for the British economy as a whole.

No one denies that it's going to be a big challenge, but an important one. Far better that farmers take their own initiatives, rather than waiting for legislation.

Defra sets out its stall

Defra has provided more details on how direct payments will be phased out in England and how the future Environmental Land Management Scheme will function, although arrangements after 2021 remain unclear: Plans for future greener farming

ELMS will have a three tier entry scheme. As far as the basic payment is concerned, farmers making a claim of more than £150,000 will be subject to a 25 per cent reduction in 2021, while those making a claim of up to £30,000 will be subject to just a five per cent reduction.

I welcome proposals on productivity and research and development. From 2021, new government grants will help farmers to invest in equipment and technology which will help them to increase their productivity and deliver environmental benefits. From 2022, Defra will support research and development projects to help our farming industry benefit from innovation, enabling farmers to produce food more efficiently and sustainably with lower emissions.

As far as smaller investments are concerned, 'Grants will be available for equipment, technology, and small infrastructure investments that will make an immediate difference to farm performance, including investments that help farmers use less inputs, reduce emissions, and cut waste, which will also benefit the environment.' These will be for specific, pre-determined items - in other words the devil is in the detail.

As far as larger investments (sum not specified) are concerned, 'These grants will be for higher-value or more complex investments, with the potential to bring transformational improvements to business performance. Eligible investments could allow for more efficient use of labour, provide opportunities to switch to alternative or more efficient production methods, reduce environmental impact or create opportunities for new business models and alternative ways of selling produce directly to customers.' These will be for priority outcomes, including the use of automation and robotics.

The end of farming?

This 'long read' in The Guardian takes the kind of line one would expect, i.e., it is critical of 'intensive' farming and sympathetic towards attempts at rewilding and environmental regeneration: The end of farming?

In my view farmers tend to rely too much on food security arguments as a response. I think there is a need to engage more with these environmental concerns, even if some of them are overstated. Farmers may feel that an urban audience does not understand their challenges, but the UK is a highly urbanised country.

It doesn't help that some farmers still appear to be in denial about climate change according to a recent report in Farmers Weekly. An survey carried out for them by Macleod Research found that more than two-thirds of the farmers interviewed believe the increase in extreme weather events seen over the past five years is due to climate change – but many believe it isn’t.

Some 31 per cent said they believed weather patterns were cyclical and had always changed over the years Many said weather patterns were natural and had little or nothing to do with mankind or the impact of human activity. Of those who believe extreme weather is due to climate change, 68 per cent said it was a threat to their business but 32 per cent of respondents said they believed it was an opportunity to do things different, including growing different crops and starting new enterprises.

NFU president Minnette Batters has recently claimed that farmers are feeling 'hurt and demoralised' by the anti-meat agenda that has labelled them the problem and not part of the solution to mitigating climate change. The simplistic argument that meat is bad and plant-based alternatives are good has been 'enormously detrimental' to farmers’ mental health, she argued. However, she did go on to accept that the farming industry will face huge change.

The Guardian article argues that 'technology is opening a whole new direction for food production, which will take farming away from the farm. Robotics and drones are reducing the need for humans to be on the land, while vertical farming, in which vegetables can be grown in sunless warehouses using LED lighting, gene editing and metagenics – the engineering of specific enzymes or proteins – are coming up with new definitions of food.' Vertical farming in my view is still very niche, but I will examine it in more depth in a later post.

However, if new technology is going to be adopted at a time when farm profits are likely to fall, some government funding to accelerate the rate of adoption would be justified.

Can agribots boost farm productivity?

It is well known that UK farming has a poor productivity record. Given the phasing out of subsidies after Brexit, farmers need to find new ways to run their businesses more efficiently.

One way forward is the use of new robotic technologies, in particular for weeding. Advances in computer vision are making this possible and The Economist reviews the potential: Robots are on the rise.

One of the companies discussed is RootWave which is located close to me in Kineton in Warwickshire. Their product uses electricity to zap weeds. Clearly a small start up company they recently acquired €6.5m of funding: Financing success

There is clearly some interesting experimentation and product development going on. But what are the chances of adoption by farmers? Capital costs are always a consideration and these agribots need skilled operators who have to be trained and then paid high wages.

Agricultural innovation usually follows a bell shaped curve with some farmers willing to be early adopters. They might be encouraged by government grants towards training and capital costs. Another round of the Countryside Productivity Small Grants Scheme is expected later in the year, but last time its budget was just £15m and the maximum any one farmer could claim was £12k which may not be game changing.

No profit in dairy sector before basic payments

According to consultants Andersons dairy budgets for the 2020/21 milk year show no profit before BPS payments: Dairy budgets

The main factor is a lower milk price, estimated to be down by 0.8p a litre. The firm sees the next decade as one of profound change as subsidies are withdrawn. Milk producers will find accessing the ELMS scheme more challenging than other sectors. Farmers in the sector are least likely to have joined existing stewardship schemes.

Dairy farming in the traditional milk production region of Wisconsin in the United States is also facing big challenges, with farms either going industrial or going bust. The rising cost of labour is one factor: Business has gone sour in America's dairy capital

UK consumers drink just half the milk they did in 1974. Research by market analyst Kantar found that the decline can be linked to reduced consumption of foods such as tea, coffee and breakfast cereals. The uptake of plant-based alternatives is also contributing, although these products still account for 4.6 per cent of the volume of all milk sold in the UK.

The answer no longer lies in the soil

NFU Mutual have produced an excellent report on diversification activity by UK farmers. What is clear is that one response to the phasing out of subsidies is an increase in diversification activity: Diversification

A note of caution is necessary. Much of the low hanging fruit has already been taken. Diversification requires a different skill set from farming and often considerable capital, so risks need to be carefully assessed.

NFU Mutual's Chris Walsh told Farmers Weekly:'There is only room for a certain number of farm shops, holiday cottages and wedding venues, so farmers planning to diversify need to do careful research and costings before they start converting cow sheds into cafes.'

Some of the traditional favourites such as on farm holiday lets are seeing a fall off in income as customers favour long weekend breaks over weekend stays. Mind you, one can adapt to this by offering luxury accommodation for large family get togethers, having shelled out a four figure sum this morning.

Perhaps most worrying is that the sector most under threat by market trends as well as subsidy withdrawal is livestock farming in challenging locations which often offer fewer diversification opportunities. Forestry is one that may be available.

Defra statistics show that diversification generated £740m of income in 2018/19, up six per cent on the previous year.

Cornish MP is new Defra secretary

George Eustice has been promoted from Minister of State at Defra to be the new Secretary of State. He is the MP for Redruth and Camborne.

Coming from a farming background, his family still run a fruit farm, restaurant and farm shop in Cornwall where they also have a herd of South Devon cattle and the country’s oldest herd of the rare breed of pig, the British Lop.

His appointment has been welcomed by the NFU.

The British Association for Shooting and Conservation (BASC) says the appointment of George Eustice as environment secretary signals the arrival of a ‘real countryman’ at the heart of government.

Christopher Graffius, BASC’s executive director of communications and public affairs, said: 'George Eustice is a farmer with a sound knowledge of the environment and rural affairs. His appointment means that we have a real countryman at the helm and this can only be of benefit to conservation, shooting and rural affairs.'

Could Dom's deal be bad for UK farmers?

The Foreign Secretary, the Rt. Hon. Dominic Raab is visiting Australia today and tomorrow: Foreign Office statement

A free trade agreement with Australia has received much less attention than one with the United States in terms of its impact on agriculture, but it could actually be greater. My concerns in the past have focused on exports on lamb and cheese, but I may have been focusing on the wrong target.

According to Wake up to Money on Radio 5 this morning, Australia is interested in beef exports, including hormone reared beef (which concerns me more than chlorinated chicken, although that is bad enough).

The writer visits an irrigation area in New South Wales

This figures as some years ago I was given a study tour by the Department of Agriculture in Australia. We visited a huge dry lot beef farm where our guide kept referring to the 'beasts'. No doubt they were properly looked after, but I don't think animal welfare activists would like what I saw. The entire output was going to Japan, but some of it could easily be sent to the UK.

I also visited a wine production area which relied heavily on irrigation (with consequent impacts on the Murray-Darling system). Australia is also interested in more access for its wines and claims that that could costs by £1 a bottle.

Much Australian wine is at the cheap end of the market (I have crossed the famous 'Jacobs Creek') although I have had some excellent wines from the Margaret River area of Western Australia. There is probably no real threat to the developing UK industry (I should declare that I am investor in Chapel Down in Tenterden, Kent).

It's livestock producers that should be concerned.'

Incidentally, according to The Times yesterday the Foreign Secretary is known in Whitehall as 'Dim Dom'. I am sure this is unfair, but I also know how tough and well-informed Australian negotiators can be.

Agriculture Bill may threaten smaller farms

Richard Byrne from Harper Adams University welcomes the radicalism of the new Agriculture Bill but warns it may pose a threat to the viability of smaller farms: May not be enough to sustain smaller farms

He is justifiably concerned about trade relationships with the United States, but one might add that the phasing out of the Basic Payment is also a challenge, given that it represents the difference between profit and loss for many farms. ELMS may involve transaction costs (form filling) that it is easier for larger enterprises to deal with. Smaller farms may also be located in areas where fewer diversification opportunities are available.

But should maintaining smaller farms be a policy objective? Or would consolidating units boost productivity?

Farm produce may have to be taxed

The Committee on Climate Change has recommended that consumers cut that consumption of beef, lamb and dairy products to combat global warming. If this does not happen, taxes on these products may be necessary: Unwelcome news for farmers

The NFU's response is here: Strong message on climate change

Recent severe weather events, with a higher incidence of droughts and flooding, appear to have enhanced farmers' awareness of climate change, as evidenced by an interesting survey conducted by Farmers Weekly: Cost of extreme weather.

On a visit to my brother-in-law's sheep farm last weekend I learnt that lambing at the 1,000 foot level now starts much earlier than it did in the past as the climate has warmed.

More than four out of five farmers said they are experiencing more frequent extreme weather events on their farm – ranging from severe drought and hot summers to flooding and intense rainfall at unexpected times of the year. Three-quarters of those questioned said it had cost them more than £50,000 – an average of more than £10,000 per year.

More than two-thirds of farmers believe the increase in extreme weather events seen over the past five years is due to climate change – but many believe it isn’t. Some 31% said they believed weather patterns were cyclical and had always changed over the years Many said weather patterns were natural and had little or nothing to do with mankind or the impact of human activity.

I have a family interest in the success of livestock farming, but it is smell the coffee time. Domestic consumption of red meat is likely to decline for health as well as environmental reasons. Given that the Committee on Climate Change thinks there needs to be more woodland, livestock farmers could be given incentives to plant trees - but no regimented conifer forests please.

Dysfunctional CAP on its way out, but can farming meet climate change challenge?

The Agriculture Bill which will provide the basis for farm policy in England after Brexit has been published: A boost for the environment and food production

In line with the new policy approach developed by Michael Gove when he was secretary of state at Defra, it is claimed that 'It sets out how farmers and land managers in England will in the future be rewarded with public money for “public goods” – such as better air and water quality, higher animal welfare standards, improved access to the countryside or measures to reduce flooding. This will contribute to the government’s commitment to reaching net zero emissions by 2050, while at the same time, helping to boost farmers’ productivity.' [Farm productivity has been growing slowly.]

'This will replace the current subsidy system of Direct Payments which pays farmers for the total amount of land farmed, skewing payments towards the largest landowners rather than those farmers delivering specific public benefits.' Farmers have been highly reliant on those subsidies to keep their farms viable and the new form of payment is likely to generate a less certain income stream. Overall farm funding will be maintained at current levels, but not adjusted for inflation, for the duration of the current Parliament, i.e., potentially until 2024.

The main concern of farmers is not the domestic legislation but the prospect of imports of cheap food, produced to lower standards, as the result of trade deals: NFU president Minette Batters.

Much of the future for British farming will depend on the adoption of new technological innovations with the prospect of a digital revolution in farming that deserves to be encouraged by appropriate government funding.

Few of us will mourn the disappearance of the dysfunctional CAP which was not well adapted to British farming. However, the ability of British farming to adapt to climate change and reduce greenhouse gas emissions will be a big challenge for farmers. Recent extreme weather events in the UK including both droughts and floods have brought home the reality of climate change to the farming community.

Lessons from the Candian trade deal

The failure of Canadian farmers to reap the benefits they hoped for from the trade deal with the EU could have implications both for any UK post Brexit deal with the EU and for negotiations on trade with the US.

Of course, it is always worth pointing out that the UK and the EU share a common regulatory starting point, making negotiations less complex in principle, although some divergence post Brexit has always been anticipated. That is a source of tension as the EU does not want the UK to be more competitive by substantially changing the regulatory environment.

Canadian agricultural exports to the EU fell 15 per cent in the year 2018. The underlying issue here is that the main market for Canada is the US and therefore Canadian farmers are oriented towards meeting their standards rather than the more stringent ones of the EU. This particularly relates to the banning of antibiotics and growth enhancement technology, both controversial issues with EU consumers.

As Charlie Mitchell notes in an article for the Financial Times livestock farmers must have their methods endorsed by vets certified by the EU and there are not many of them around in beef producing areas in the Canadian west.

Consequently, the Pink 'Un reveals that apparently generous quotas given to Canadian livestock farmers remain unfilled. Canadian pork farmers filled just 1.5 per cent of their quota and cattlemen filled 3.8 per cent of theirs. In contrast, European fine cheese producers had no difficulty filling their quotas with products that doubtless appeal to many Canadian consumers.

German farmers want a soft trade deal

The German Farmers' Association (DBV) are pressing for a generous post Brexit trade deal for the UK: Give UK a good deal

The UK is a key customer for German agriculture, importing €4.5bn of goods a year, while sending just €1.3bn in the other direction. No other country gives Germany such a big surplus in food and drink. Of course, the EU has a trade surplus on goods with the UK, but not on services.

The DBV is concerned that if there is no agreement in place by the end of 2020, the surplus could be halved. Even if there is a mutually beneficial deal, the surplus will fall by one fifth. For analysis by the Johann Heinrich von Thunen Institute of two different scenarios, go here: Implications for the German agro-food sector

Britain imports more than a third of the food and drink it consumes from the EU, more than it buys from the rest of the world put together. Its biggest source is the Netherlands, followed by Germany, Ireland and France.

There is a debate within the Government about whether parallel trade talks should be held with the US, some arguing that this would put pressure on EU negotiators. The US is likely to want looser rules on GM crops and livestock products which could well be controversial.

Veganuary makes headway

Veganuary is a campaign to persuade people to try a vegan lifestyle in January: Veganuary. They state: 'Our vision is simple; we want a vegan world. A world without animal farms and slaughterhouses.' Clearly not good news if you are a livestock farmer.

The campaign is clearly making some headway, although one of the first lessons in a research methods course is that there is a difference between what people say, particularly if it is seen as virtuous, and what they do.

I think that the impact of a 'flexitarian' diet may be greater, i.e., where people cut down, or eliminate, the consumption of red meat for both health and environmental reasons, as well as concerns about animal welfare. Wanting to be healthier appears to be the main reason for giving up animal products (55 per cent), followed by animal welfare concerns (49 per cent) and protecting the environment (30 per cent).

Sales of red meat fell more by value than any other category in supermarkets last year, down by £185m according to Nielsen. Sales of meat-free alternatives rose by 18 per cent to £405m, the highest growth rate of any category. Sales of poultry were up 1.4 per cent and fish 1.2 per cent.

There is, of course, a whole spectrum of choices from being a pescatarian to a vegan, although it is said that vegans particularly have an issue with vegetarians because they do not follow their position to its logical conclusion. However, for some people, becoming vegan may involve a series of transitions.

832,000 people gave up some animal products for the first time in January 2019, according to Kantar research, based on tracking purchases of 30,000 households. Six months later 57 per cent said they still avoided the same products. Of those who had gone back to eating animal products, three quarters said they were eating less than before.

When I went to Marks & Sparks this morning they were heavily promoting plant based products, so clearly retailers see a commercial opportunity and a chance to burnish their green credentials.

The NFU thinks that livestock farmers could export more of what they produce, given that the environmental impact of production systems based on existing grassland was less than than tearing down forests to creating grazing as in Brazil.

The livestock sector is already in economic difficulty and vulnerable to a 'no deal' Brexit. Unfortunately, much of the land on which livestock is reared is not suitable for growing field vegetables or fruit. One issue for fruit and vegetable crops is the availability of environmentally friendly plant protection products based on biology rather than chemistry.