By Allan Barber*
Two contrasting publications have each given a pretty damning picture of the state of farming and food production in pre-Brexit UK; and despite the conclusions of the Ferguson Cardo report into the future of British agriculture, it is hard to see how this situation will change for the better without a huge amount of pain on the way.
But equally it is almost impossible to imagine a continuation of the status quo within the EU, where in 2015 70% of UK farm income came from direct and environmental subsidies.
A much shorter piece in the well-known satirical paper Private Eye captures the problems faced by UK dairy farmers very cogently, although these have been well publicised already. The number of dairy herds has fallen like a stone since 1993 – the year the Milk Marketing Board was abolished - when there were 33,000 herds, compared with fewer than 10,000 today. The cost of milk production this year is forecast to rise to 32.5 pence per litre, while the price farmers receive is anchored at 25p or even worse predicted to fall even lower. Not surprisingly more closures are expected.
The price is now lower than when the MMB was dismantled 24 years ago, since when dairy farmers have been forced to negotiate contracts individually with dairy companies. One result of the decline has been the inevitable closure of fresh milk processing plants instead of upgrading old plants. The latest closure announcement on the outskirts of London affects dairy farmers in Suffolk and Essex where there are only 39 dairy farms, a decline of 80% since 2005.
The obvious question is why anybody would want to remain in dairy farming under these circumstances, explained only by a passion for the way of life and the difficulty of changing to another farming type or getting out.
The picture is not quite as bleak for most alternative farming types, although pigs and grazing are just as bad, while incomes in Scotland and Northern Ireland are considerably worse than in England and Wales.
However across the board Britain has a significant food deficit between what it exports and imports. Total exports of GB Pounds 18 billion of which the EU takes 60% are dwarfed by imports of GBP39 Million, 70% from the EU. Therefore, with or without Brexit, the UK has a major problem working out what to do about its agricultural economy, because it cannot continue to throw money at keeping unsustainable farmers afloat. This becomes even more acute after it finally manages to leave the EU.
The message from Ferguson Cardo is to leverage the growing agritech sector and to get different government departments to coordinate efforts and investment to achieve commercial and societal objectives. A question is whether this will be fast or substantial enough to create a profitable future. It sometimes seems as though New Zealand’s challenges are minor in comparison.
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*Allan Barber is a commentator on agribusiness, especially the meat industry, and lives in the Matakana Wine Country. He is chairman of the Warkworth A&P Show Committee. You can contact him by email at email@example.com or read his blog here ». This article was first published in Farmers Weekly. It is here with permission.