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Farming

Market questions remain unanswered

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Richard and Rachel Walker: Urge the UK Government to provide clarity

A GLAMORGAN beef and sheep farming couple have called for clarity on trade and funding post-Brexit on the eve of the 1 year exit countdown.

Farmers’ Union of Wales Glamorgan County Chairman Richard Walker and his partner Rachel Edwards, who run Flaxland Farm – a 120 acre holding just outside of Barry, look after 120 breeding ewes, 3 rams, 40 lambs from last year, 150 lambs from this year and 100 cattle (consisting of 37 breeding and 60 young stock).

They are worried about the lack of progress made in trade negotiations and the fact that farmers in Wales still don’t know what budget will be allocated to Wales in terms of agriculture.

Speaking from his farm, Richard said: “We are 1 year away from leaving the EU, yet we have no idea of where our produce will be sold to and under what conditions and we don’t know how much money will be allocated to Wales as part of the agricultural budget. It is very worrying and I urge the UK Government to provide clarity as soon as possible.”

Even though Richard and Rachel have secured a market for their lambs with local butchers in the Vale of Glamorgan, the concern for the rest of the industry remains.

Rachel said: “We have managed to secure a market for our produce locally but that doesn’t in any way help the other lamb producers across Wales. Politicians need to understand that most of the lambs born this year will be sold into a post-Brexit market – but what exactly that market looks like, and under what conditions, such as tariffs, where and how our produce will be sold is a mystery.

“All this talk of farmers having to future-proof their business and be forward thinking is well and good but those in power need to do their bit too.”

Addressing the issue of funding, FUW Managing Director Alan Davies said: “Historically the funding to support farming in Wales has come from the Common Agricultural Policy, but once the UK leaves the EU in March next year that link will be broken.

“Any funding to support agriculture will have to come from the UK Treasury. We’ve already heard that the Government will commit the same amount of funding to agriculture for the rest of this parliament. But there are complexities around how that funding might be allocated.

“If the UK Treasury matches, as is expected, the current EU payments of £3.5 billion to DEFRA to support UK agriculture, there are at least 2 ways in which that money can be allocated to Wales. One method and the one most often used in UK Government financial calculations is to use the Barnett Formula.”

Mr Davies explained that when “new” money is allocated to a government department, generally the “Barnett consequential” for Wales is around 5.6% of the total money allocated. That means that if DEFRA receive £3.5 billion, the “Consequential” for Wales will be around £196 million.

“Wales has historically received around 9.4% of the total EU CAP budget allocation to the UK. That would equate to £329 million. Barnett would reduce our funding by around 40% and that must not happen.

“In order to deliver Fair Farm Funding for Wales it is therefore essential that the UK Government allocate funds outside the Barnett formula.

“Wales urgently needs certainty that we will receive at least our historical share of the UK’s agricultural and rural development budget promised by Secretary of State Michael Gove, especially as the budget for next year needs to be in place by October this year,” he added.

Farming

Cattle and sheep prices rise

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Prices up: But warnings given

HISTORICALLY high market prices for cattle and sheep are helping to push Wales’ agricultural sector into the black, according to market analysis by Hybu Cig Cymru – Meat Promotion Wales (HCC).

Welsh Government projections, released as part of its ‘Aggregate agricultural output and income’ and ‘Forecast of farm incomes in Wales’ statistical reports, show that agriculture is now worth almost £1.6 billion to the Welsh economy.

Beef and sheep farming – along with the dairy sector – are by far the largest contributors to this value, with the PGI Welsh Lamb and PGI Welsh Beef brands helping to secure millions in sales in the UK and export markets.

According to HCC, strong cattle and sheep prices at market are continuing to help sustain profitability, although the weather has had an impact.

“Market prices for June have continued the trend we’ve seen since the beginning of the year,” said HCC’s Data Analyst Glesni Phillips. “Poor weather in early spring is restricting the number of new season lambs coming on to the market, which has contributed to prices remaining around 10p per kilo higher than last year. Beef cattle prices are also strong, helped by a barbecue boom in the warm month of May.”

However, Glesni noted that average farm incomes were still modest, and that uncertainty over access to vital European markets after Brexit meant that forecasting future price movements was unusually difficult.

“According to Welsh Government figures, average incomes on a beef and sheep enterprise in the Less Favoured Area (LFA – which makes up over 80% of Wales’s agricultural land) are only just over £25,000,” she said. “Given that market prices are unlikely to remain at this level, and that considerable political uncertainty exists over possible levels of exports and imports of red meat, this highlights the need for agricultural businesses to prioritise on-farm efficiency as part of their Brexit preparations.”

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Farming

TFA calls for Inheritance Tax changes

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Radical change: TFA wants major tax reform

THE TENANT F​ARMERS ASSOCIATION (TFA) has called for a radical change in the operation of Agricultural Property Relief (APR) in its response to the call for evidence issued by the Office for Tax Simplification for its Inheritance Tax review.

TFA Chief Executive George Dunn said “For many rural landlords the taxation framework within which they operate has a major influence over the decisions they make about how they manage their land. The TFA believes that the Government should be using this sensitivity as leverage to achieve wider objectives for the resilience and sustainability of the tenanted sector of agriculture”.

The introduction of the Agricultural Tenancies Act 1995 represented a major deregulation of the agricultural let sector. Farm Business Tenancies (FBTs) were ushered in with the intention of improved efficiency of land use, whilst increasing opportunities for both progressing farmers and new entrants within the agricultural sector.

“Over two decades on and the TFA believes that neither of these objectives have been attained. Whilst we saw an increase in the amount of let land through the early years of the new legislation this has, by and large, tailed off. However, the biggest failing has been the perpetuation of short lengths of term leading to inefficiency. Short term tenancies are holding back progression, investment and sustainable land use. FBTs have been too short for too long and now is the time for that to change,” said Mr Dunn.

A big advantage to the taxpaying landlord is the ability to have 100% APR from Inheritance Tax for the agricultural value of their holdings let after the 01 September 1995. However, the TFA questions whether this relief should be so widely available. In circumstances where landlords choose to let for short lengths of term, there is little in the national interest to be gained from providing landlords with such a generous tax advantage.

“There needs to be a radical reform of the Inheritance Tax framework for agricultural land as it applies to landlords. Allowing for exemptions for specialist cropping lets on a rotational basis, APR should be abolished except in relation to land let for 10 years or more without a landlord’s break clause,” said Mr Dunn.

“Using changes in APR to improve the average length of term on FBTs will impact positively on the productivity, resilience and sustainability of the tenanted sector of agriculture, which is now responsible for farming around a third of the agricultural area of the country,” said Mr Dunn

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Farming

Royal Welsh to be blooming great

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The Great Royal Welsh Bloom Off: New at this year's Show

THE ROYAL W​ELSH AGRICULTURAL SOCIETY has announced it will be holding ‘The Great Royal Welsh Bloom Off’ competition during the main show on July 23-26.

Have you got a wedding coming up? This would be the perfect opportunity to learn how to arrange wedding flowers and win a wedding bouquet designed and arranged by renowned, award winning florist, Jonathan Lloyd-Davies.

Designed and sponsored by Johnathan of Johnathan’s Flowers, the competition, taking place in the Horticulture Marquee on the Tuesday (Jul 24) of the show, is open to anyone who has not previously competed in the floral art section of the Royal Welsh Show or Winter Fair, and who is interested in learning how to arrange flowers for an upcoming wedding.

Competitors do not need any previous experience (No NAFAS members), there will be no entry fee and all materials will be provided. But hurry, entries must be made in advance as spaces are limited.

The competition will follow the lines of the popular ‘Great British Bake Off’ programme, with contestants, in this instance, first taught to delicately arrange wedding style button holes, with the successful competitors proceeding to the next round to create a beautiful bridal bouquet under Johnathan’s watchful eye.

Jonathan established his business, Jonathan’s Flowers (www.jonathansflowers.co.uk), back in 1993 and has since gone on to provide an inspirational and personal florist service to South Wales and beyond. Specialising in floral designs to weddings and corporate clients, Johnathan has an impressive list of happy clients, including Catherine Zeta Jones, Bonnie Tyler, leading hotels in both Cardiff and Swansea, Glorious Goodwood, Royal Ascot and Wentworth Golf Club, to name just a few.

This exciting competition is just one of the many floral extravaganzas you will find in the Horticulture Marquee at the Royal Welsh Show. Packed full of fruits, vegetables, floral art displays, cut flowers, pot plants, window boxes and planters, a children’s decorated wheelbarrow competition, demonstrations, gardening question time, and the Welsh National Honey Show, amongst other delights… it really is worth a visit!

For more details and entry forms for ‘The Great Royal Welsh Bloom Off’, please contact: 01982 554409 / amanda@rwas.co.uk

The pinnacle event in the British agricultural calendar, the Royal Welsh Show, will be held on ​July ​23 – 26​ ​at the showground in Llanelwedd, Builth Wells.

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