Farming

Dairy Crisis Update

Published

10 years ago

February 9, 2015

IN THE FACE of the current dairy crisis, the Farmers’ Union of Wales is once again calling on major UK supermarkets to commit to the procurement of Welsh dairy produce, and to ensure that the prices paid for dairy products are such that confidence in the long term future of the sector is revived.

Speaking after a recent FUW milk and dairy produce committee meeting, chairman Dai Davies said: “The FUW has written to the leading supermarkets in the UK to highlight that last year saw many months of consecutive downward milk pricing, which has caused major problems for the sector.

“Whilst some forecasts predict a decline in global milk supplies in the latter half of 2015, the Russian trade embargo, coupled with reduced demand in China and a weak economic environment, will likely delay price rises beyond any potential downturn in production.”

According to figures supplied by Defra, the average November UK farm-gate milk price was more than 16 percent lower than the same month in 2013 and is the lowest farm-gate price since September 2012.

“The falling dairy prices experienced by producers in Wales raises significant concerns within the dairy industry, and a lengthy delay in milk price recovery now seems certain due to a continuing supply and demand imbalance within the global marketplace.

“Factors such as low milk prices, poor profitability and long-term uncertainty in the sector have severely undermined confidence in the long term sustainability of this industry; the very nature of which requires a long term commitment and investment from producers,” added Mr Davies.

Whilst the Union recognises that dairy farmers supplying supermarkets on a dedicated supply contract have received more favourable milk prices, such farmers represent only a small fraction of the Welsh dairy sector – around 4 percent of production – and are therefore unrepresentative of the industry as a whole.

“Failure to secure commitment by providing sustainable prices for dairy should be a major concern for all those within the supply chain. Between January and September 2014, UK dairy imports of cheddar cheese, speciality cheese and butter were around 77,000, 271,000 and 42,000 tonnes respectively and the union is therefore urging the supermarkets to ensure that a concerted effort is made to source dairy products from within our own shores,” added Mr Davies.

However, Sir Jim Paice MP, head of dairy co-operative First Milk said that supermarkets were not wholly to blame for the crisis.

“It is tempting to blame the supermarkets for the current downturn in milk price we’re experiencing but I have to say, as Chairman of First Milk, the crisis that we’re seeing today in the milk industry is not really the supermarkets’ fault,” said Sir Jim Paice, when speaking to NFU Cymru members in Pembrokeshire recently.

Sir Jim continued, “I believe the fundamental problem with the dairy industry at the moment is that there is too much milk on the market. We have seen an approximate increase of 10% of milk produced in the UK alone this year. That has been exacerbated by two things, China dramatically reduced its purchase of milk powder and then Russia introduced its trade ban, which included dairy products. With a third of EU cheese exports going to Russia – that was the final straw and that’s why our milk prices are where they are.

“It has resulted in a very serious situation throughout the country at the moment, particularly here in south west Wales where milk is obviously a hugely important industry.” Sir Jim Paice informed Pembrokeshire NFU Cymru dairy farmer members who attended the meeting.

He used the meeting to assure those farmers that supply First Milk that the co-operative was here to stay and everybody is getting paid for the milk they have produced. He insisted that First Milk was in a very very strong position now, the strongest it has been for many years, and it should be strong enough to withstand the volatile next few months ahead.

John Davies, NFU Cymru Deputy President and Euryn Jones, Agriculture Manager for HSBC Bank, the conference’s sponsor, both agreed with Sir Jim that we were witnessing extremely volatile times at the moment in dairy, as well as other sectors of farming, and both agreed NFU Cymru and the bank were there to help assist members and customers any way they can to get them through the volatility. John Davies said, “What we all want is a fair price from the market place for what we produce.”

Sir Jim is currently the Conservative’s Member of Parliament for Cambridgeshire but he is due to stand down at the forthcoming General Election this spring. A Suffolk farmer, farm manager and training manager, Jim Paice was in the position of Minister of State at the Department for Environment, Food and Rural Affairs in 2010 when negotiations first started on the current CAP reforms.

Reflecting on his time as Minister he said that we’ve ended up with a Common Agricultural Policy (CAP) which is pretty similar to what was originally proposed. He explained, “I’m not saying that means the first proposals were right, what I’m saying is that it was very difficult for 28 very different countries to agree. Discussions were impossible when each Minister from each Member State was given just three minutes to give their views on the proposals. It ended up with each Minister giving set speeches – not a discussion!”

Simon Richards, NFU Cymru’s newly elected Chairman for Pembrokeshire, and a dairy farmer from Haverfordwest, thanked all the speakers at the County Conference, particularly Sir Jim Paice MP, for his insight into the current situation at First Milk and his time as Defra Minister. Mr Richards also thanked HSBC Bank for its generous sponsorship of the event.

Education

Pembrokeshire pupils banned from taking part in ‘wellies to school’ protest

Published

9 hours ago

December 11, 2024

Bruce Sinclair - Local Democracy Reporter

THE FORMER leader of Pembrokeshire County council is to ask the current administration why pupils in the county were not allowed to take part in the ‘wellies to school’ protest against changes to inheritance tax on agricultural property.

The wellies to school spectacle was part of a wider November 19 protest, led by the National Farmers’ Union (NFU), held in response to the UK Government’s budget.

At the Budget, Chancellor Rachel Reeves announced farmers would have to pay inheritance tax on agricultural property and land worth more than £1 million at a rate of 20 per cent, with a £3m threshold for couples passing on their farms.

This compares to a 40 per cent rate on other estates.

However, Pembrokeshire schools were not allowed to engage in the wellies to school message.

A spokesperson for Pembrokeshire County Council said at the time: “The Education Act 1996 clearly prohibits practitioners from promoting partisan political views, and therefore, our schools are not permitted to promote the farmers’ protest taking place in London today.”

Former council leader Cllr Jamie Adams is now asking why the decision was taken.

In a question submitted to the December meeting of Pembrokeshire County Council, Cllr Jamie Adams says: “The recent spectacle of children wearing wellies to school on November 19, served as a powerful message that rural communities are concerned about the long-term sustainability of agriculture following the Government’s alterations to Agricultural Inheritance Tax.

“This widespread industry underpins the economy, social fabric, community cohesion and in many parts the Welsh language here in Pembrokeshire as much as any rural county due to the high prevalence of family farms.

“It was therefore concerning to hear that Pembrokeshire Local Education Authority sought to prevent children from overtly demonstrating their support by this action deeming it as ‘political’.

“I would therefore like to ask the Leader [Cllr Jon Harvey] how this position was adopted and who actually made the decision?”

Cllr Adams’ question will be heard at the December 12 meeting.

Farming

Calls for Pembrokeshire to oppose farming inheritance tax change

Published

21 hours ago

December 11, 2024

Bruce Sinclair - Local Democracy Reporter

A CALL on Pembrokeshire County Council to oppose the Labour Government’s changes to inheritance tax affecting family farms is to be heard later this week.

This compares to a 40 per cent rate on other estates.

A Notice of Motion by Councillor Aled Thomas, ‘relating to Protecting British Family Farms and Preserving Rural Communities’ is to be heard at the December 12 meeting of Pembrokeshire County Council’s full council meeting.

Cllr Thomas, who stood as a Conservative candidate for Ceredigion-Preseli in the 2024 general election, asks that: “Pembrokeshire County Council notes its concern to the proposed changes to inheritance tax announced by the Labour Government in the recent Autumn budget, which would scrap Agricultural Property Relief (APR).

“APR has been instrumental in allowing British family farms to remain intact across generations, supporting food security, sustaining rural communities, and aiding environmental stewardship. This tax is estimated to impact over 70,000 family farms, leaving the average farming family with a tax bill of at least £240,000, which will force many to sell portions of their land or close entirely, paving the way for corporate ownership over family ownership.”

It calls on the council to resolve to “oppose the Labour Government’s changes to inheritance tax affecting family farms,” to “advocate for the exemption of family farms to preserve the UK’s food security, rural communities, environmental initiatives,” and to “commit to maintaining its county council farms portfolio, particularly to encourage younger and new generations of farmers into the industry”.

It finishes: “This council urges all councillors to stand with Britain’s family farms, to support our rural communities, and to protect the environment by formally rejecting this proposed ‘family farm tax’.”

Cllr Thomas’s notice of motion will be considered at the December 12 meeting.

Claims were recently made, and denied, that Mid and South Pembrokeshire MP Henry Tufnell may have had insider knowledge of changes to Agricultural Property Relief recently announced by the Chancellor, with inferences it led to his wealthy landowner parents shielding their estate.

A spokesman for the Mid and South Pembrokeshire Labour MP said: “As has been widely reported, it would seem that even Steve Reed, the Secretary of State for DEFRA, was not aware of the specific changes to Agricultural Property Relief (APR) and Business Property Relief (BPR) before the Budget was announced.

“It would therefore be implausible to suggest that Henry – a backbench MP – would have this kind of knowledge prior to the Chancellor’s Budget announcements before they were made public.

“The actions taken by Henry’s parents were based on professional advice from qualified financial advisers, reflecting prudent and responsible management of their family affairs.

“This is something that every farmer in Pembrokeshire should consider in light of the Chancellor’s recent announcements, to ensure they are prepared for the evolving landscape of farming taxation.”

Farming

Call for more responsible farming in Pembrokeshire to be heard

Published

1 day ago

December 11, 2024

Bruce Sinclair - Local Democracy Reporter

A CALL for a special farming role to be established for one of Pembrokeshire County Council’s senior councillors is to be heard later this week.

In a question to council leader Cllr Jon Harvey, to be heard at the December 12 meeting of Pembrokeshire County Council’s full council meeting, Conservative group leader Cllr Di Clements will ask: “With the recent changes in the budget from the UK Labour Government on Inheritance Tax and Agricultural Property Relief, many Pembrokeshire farmers are feeling concerned for the future of their family farms, many in Pembrokeshire which have been in the same family for generations.

“I have always found it disappointing that in all the years I have been a councillor, and the major contribution farming has to this county’s economic, cultural and environmental well-being, there has never been a Cabinet Member’s title with rural affairs or farming, or agriculture within it.

“To show that this council recognises the importance of agriculture, and the hundreds of millions of pounds generated by farming, will the Leader consider including it in one of the titles of his Cabinet Members’ portfolio?”

Cllr Clements will also ask a second question of the council’s leader, who replaced Cllr David Simpson in the role back in May.

Pembroke St Mary North member Cllr Harvey beat fellow leadership hopeful Conservative group leader Di Clements by 30 votes to 27 to secure the role.

Cllr Clements will ask: “The leader has now had some time to settle into his new role. Could he outline his key priorities for the future and explain how he intends to ensure value for money for council taxpayers on the services it provides?”

Both questions will be heard that the December 12 meeting.