Farmer confidence low, and a warning from dairy sector

Farmer confidence is dwindling with the latest NFU Farmer Confidence Survey showing things are at their lowest ebb since the start of the pandemic, knocking investment and with possible serious long term impact on food production.

High costs and labour shortages show that half the farmers surveyed are planning to cut back on food production over the coming 12 months which could add to supermarket shortages and empty shelves.

Government is schizophrenic in its approach which is concerning; abandoning the horticulture strategy published in June last year due to the ‘sector operating in a complex, ever evolving commercial and political landscape’.

Whilst this sector is in crisis, the promise to put together a plan to battle sky high costs and labour shortages was desperately needed.

To walk away and scrap the strategy is leaving operators on a knife edge with little hope for the future.

Hill farmers are also being let down by the current schemes which have a lack of options for them, leaving them locked out.

As the Basic payments are further reduced this year and phased out in the next three or four years, it leaves the uplands in a perilous position.

Cumbrian MP Tim Farron has accused Defra of betrayal, warning that many upland farmers will go out of business as the payment represents 50% of their profits and often a lot more than that.

The ‘income foregone’ principle which Defra is sticking to puts off many farmers from claiming as it is not worthwhile.

Some will intensify their farming in order to survive, undoing the work they have done with government to date and doing the exact opposite to what the Entry Level Stewardship Scheme ambitions are.

Tim Farron accused the government of implementing a catastrophic agricultural policy which leaves upland farmers especially exposed.

Yet, government is trying to attract new blood into agriculture with its New Entrants Support Scheme.

Now let’s be clear, of course we want new entrants into farming and I have been involved in various schemes and pilots and endless discussion around bringing young people into farming for the past 30 years, but one has to be very careful not to encourage people in where they lose what little capital they have.

Farming is tough and it is difficult to make money and we have a small number who come in every year and make it work, but they are exceptional people.

A government scheme is highly unlikely to work in my view as they are making it harder and harder to make a profit and their general approach is a turnoff.

he free-market instincts of the far right of this government think that if you remove all support from agriculture then land prices and rents will fall.

Unfortunately that is not the case as many people and large business buy land for tax reasons, offsetting carbon and so on.

For government to be enticing young people into our industry when there is little or no profit in many sectors, county councils have sold much of their small-holdings where young farmers traditionally started to farm, supply chain fairness is not there as both inputs and output from farms is controlled by few multinational and large retailers and no equivalent standards for imports, is very odd.

Unless of course they think that current farmers are EU feather-bedded and new blood is needed in order to show how it’s done?

The only way to attract talent is to make this a profitable industry and that is a big challenge.

Governments of all colours have been wedded to a cheap food policy since 1947 and it has worked very well. Yes there have been unintended consequences along the way but they have been addressed and corrected.

However, in order to have such a policy government has to fund it and now this government; having made a promise not to in the Brexit referendum, is pulling that funding.

It listens to pressure groups on environment and animal welfare, whilst doing deals abroad to make up the potential shortfall in food production here, for what it thinks will be cheaper food but closes its eyes to the fact that it will have been produced to different standards.

Of course many of us knew then and certainly now, that the promises made by any political party these days is not worth the fresh air used to express it, all it does it probably contribute to global warming!

Laughably the far right of the Conservative party listen to New Zealand pundits who encourage them to abandon all payments overnight as they did.

It is interesting that New Zealand is an exporting nation with an eye on our markets.

I can tell you that whatever their glossy adverts say; their welfare is not as good as ours and the way they have evolved ‘easy-care’ is not pretty to say the least.

It is true that they operate outdoors which everyone seems to want, but they have winter too and those animals stay out, with winter being very different depending on where you are in New Zealand.

The other misnomer is that grass based systems are always extensive, but dairy farming New Zealand style is incredibly intensive, but those who just see cows in green fields don’t realise it.

New Zealand farming is amazing and I have farming friends over there and they are tough, innovative survivors, but are allowed to do many things we are not in the UK.

Every country plays to its strengths and the New Zealand farming story has been truly amazing and it is tremendously rewarding to visit, but it is not the same as the UK.

However, they are top of the pile when it comes to the trade deals we have struck so far; its downhill all the way on welfare and environment after that, and it’s a long and steep hill.

Here milk prices continue to fall and even farmers in Sussex who have been highly profitable through thick and thin are looking at their costs and seeing a very tough 12 months ahead.

Goodness knows what the dairy farmers up and down the country who have struggled whilst these guys have been making money are thinking now?

Hence the call from the likes of Kite Consulting who have many dairy farmers on their books, warning that this is getting very serious and there is going to be some unpleasant consequences very soon if it carries on.

Will the government come to its senses? Is Defra capable of getting its act together?

I would say no in the short to medium term and of course that takes us to an election.

Will that threat spur everyone to get a grip and do better and see sense? Or is it now too late and turning the civil service ship around takes too long?

We know those who sailed this ship and we know the lies told before it abruptly changed course and I fear it will be a case of re-arranging the deckchairs on the Titanic.

I sincerely hope not but when dealing with such incompetence one has little hope and just like Osborne’s disastrous ‘austerity’ programme, the repercussions will be felt for many years to come and a coronation will not save it.