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Farming

First Milk simplifies pool pricing

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Milk: Producer pricing simplified

FIRST MILK has announced that from April 1, 2018 it will be changing its approach to regional milk pool pricing, which will see its previous payment schedules simplified to just two payment schedules – First Milk Liquid and First Milk Manufacturing.

This development has been made in response to member feedback and is fully supported by the Member Council and Board. It will see milk prices harmonised at a standard litre of 4.0% butterfat and 3.3% protein, with the April price on this basis being 26.0 ppl.

Commenting on the developments, Jim Baird, Farmer Director and Vice-Chairman, said: “Whilst in recent weeks we have seen some recovery in the market, unfortunately, the overall global dairy commodity markets remain weaker than last year, which continues to impact on our returns. We know that this price drop will be disappointing news for our members and continue to do all that we can to minimise the impact of reductions.”

He added: “This more simplified and transparent approach on milk prices reflects the requirements of the business today and is a progressive step which unites our members across the country.”

Milk Policy Manager, George Jamieson of NFU Scotland, said: “NFUS has consistently believed that First Milk, as a farmer-owned business, should as far as possible have a pricing policy that is transparent, uncomplicated and treats all members, regardless of geography and end use, the same way.

“All First Milk members contribute to the business diversity so this move is welcomed by NFUS and we congratulate it for taking this step. The strength of a co-op is in bringing members together to draw strength in a common cause. First Milk Members in Scotland have suffered from lower prices on the whole, but this move is more important than regional sensitivity as it demonstrates a commitment by First Milk to a simpler and equitable pricing model.

“NFUS has met with First Milk recently and supported this move and also discussed other areas, such as governance and ongoing price challenges. The new governance model with a new Council and Board structure and a new Chief Executive is, we believe, making progress. Ultimately it will be farmer owners who will decide if it is working for them, which will be judged on price paid back to the farmers aligned with investment and sustainability.

“On price, First Milk’s new price of 26ppl is disappointing but not out of line with other processors. The drop does not reflect the new pricing model, but the downturn in the dairy market, which NFUS believes should be at the bottom of the curve. First Milk, as a farmer owned co-op, must pay as much as it can based on its markets and costs regardless of competitors pricing, and over the last two years it is pleasing for hard pressed FM farmers to see the gap in prices between FM and competitors closing.

“Looking ahead, commentators and futures indicators are cautiously suggesting that the recent price drops may be at an end. NFUS was very clear that we believed that farmgate prices last year did not reach the levels that were justified by the market, and that the slide back to unsustainable farm gate prices has been too speedy. Milk pricing remains at the discretion of milk processors, who under intense pressure from competitors and retailers have the reassurance that they have the power to set the price they pay for their primary product and largest cost.

“This is not an acceptable nor efficient way for any supply chain to be sustained. NFUS has consistently strongly lobbied for a dairy supply chain that was fair and efficient.

“While the Grocery Code Adjudicator has declined to include the primary producer under its remit, it has acknowledged the strong evidence supplied by NFUS and NFU that dairy farmers and the supply chain needs additional measures. Defra has committed to introduce mandatory contracts with minimum standards in the dairy sector and will consult soon.

“NFUS is fully committed to this and strongly urges all with the best interests of the dairy sector to engage and support this move. This is perhaps the single biggest opportunity the dairy sector in Scotland and the UK will have to set a direction of travel that can grow a dairy sector which is competitive and sustainable.

“Mandatory contracts on their own will change nothing, but contracts which are agreed, as against imposed, covering such contentious issues as pricing, management, shared risk and reward, will make a significant difference.”

Farming

2019 ‘a step into the unknown’

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IN HIS New Year Message Kevin Roberts, chair of Hybu Cig Cymru – Meat Promotion Wales (HCC) has said that never has a year brought such uncertainty, due to the ongoing political deadlock over Brexit.

Mr Roberts emphasised that the red meat industry, which brings £200m a year in export income for Wales and boasts the world-renowned PGI Welsh Lamb and PGI Welsh Beef brands, was one of the sectors with most to lose.

WTO Tariffs, which are likely to be levied in the absence of a deal, are 5-10% on many types of goods but on fresh red meat, they range from 40-80%. Independent studies have also identified the sheep sector, which is heavily dependent on exports of its premium-quality produce, as particularly vulnerable to a disruption in European trade.

HCC Chair Kevin Roberts said, “Throughout the past year, I’ve said time and again that the future is fundamentally bright for our industry. We have top-quality produce, brands which are recognised throughout the world, extremely dedicated producers and an industry which pulls in the same direction in promoting high standards in meat quality, welfare and sustainability.

“However, as 2019 dawns we find ourselves standing on a cliff edge,” he said. “Independent reports project a fall of 30% or more in farm-gate prices if there’s a chaotic Brexit, and farmers need certainty in order to invest and continue to develop their businesses.

“HCC is working with Government and others to put contingency plans in place as far as we can,” added Mr Roberts, “but the uncertainty and the range of potential outcomes are so great – just three months before the exit date – that the complexity involved is immense.

“Our industry’s New Year wish is simple; to be able to trade freely and fairly and have some certainty for the future.”

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Farming

NSA hits back at vegan campaign

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THE ARRIVAL of a new year is often a time of optimism, of making plans for the year ahead, but increasingly for livestock farmers, January is now the time producers find themselves arguing a torrent of false claims of crimes against animal welfare, the environment and human health that the media are so quick to promote as part of ‘Veganuary’.

And this year, the National Sheep Association (NSA) is ready to fight back against what it says is ‘a misguided and misleading campaign’.

NSA Chief Executive Phil Stocker says: “Make no doubt about it, behind the positive messages about Veganuary lies a well-coordinated campaign against livestock farming. Our concern is that our unique grass-based method of sheep production in Britain is hidden within more global and general statistics.

“We are seeing criticisms from welfare campaigners, rewilders, climate change campaigners, and health campaigners – but all these are connected and ignore the fact that UK sheep farming works very much in harmony with our environment, our landscapes, and our human ecology – creating a countryside the majority of the public love and producing a food product that is healthy and nutritious within a balanced diet.

“The climate change arguments that have been buoyed by the recent Paris Climate Change Summit ignore the fact that red meat from livestock that is part of a grass-based system is different from that raised in feedlots and in intensive situations. Even more misleading is that the carbon footprinting tools we use do not take account of whole life cycles and ignore the role of grasslands and grazing animals in storing carbon and organic matter in our soils and even in the wool they produce. I would go as far to suggest that ‘organic greenhouse gas cycling’ from grazed livestock should be treated separately from gas emissions derived from fossil fuels.”

NSA says the UK should be seeking to maintain or even increase sheep numbers here in the UK, related to market demand, but further encourage the distribution into areas that are devoid of livestock in order to provide the multi-functional outcomes that people are interested in today.

Mr Stocker concludes: “In the UK sheep are a form of positive and regenerative agriculture which keep our uplands and permanent pastures in good condition and improve our cropping lands in terms of soil quality and the ecological benefits of a return to mixed farming.

“Some people seem hell-bent on portraying sheep as a global enemy, but in fact, they are the ultimate in renewable technology and are an efficient form of productive land management that is planet friendly.”

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Farming

Sheep and goat inventory

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NFU CYMRU is reminding farmers that the 2019 Annual Sheep and Goat Inventory forms must be returned by February 1.

The form is a legal requirement and must be returned by no later than Friday, February 1, to avoid an increased risk of being selected for an inspection. The form should include the number of sheep and goats of which the farmer is the registered keeper, by CPH location, on January 1, 2019. Farmers must also record the number of sheep and goats on January 1 in their on-farm flock record to avoid a potential cross-compliance penalty.

Sheep and goat keepers have the option of completing the form online via www.eidcymru.org. However, keepers must have registered to EIDCymru prior to submitting the online inventory return. If you are completing the form electronically, you do not need to return the paper form

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