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.