The Milkmaid by Johannes Vermeer [Public domain], via Wikimedia CommonsThere’s been a lot in the news about the price of milk recently because of the low prices that some farmers are receiving for their produce (see here, here and here for example).
I still have a milkman who delivers (quite expensive) milk to the door several times a week but I am glad to see that my back-up sources of milk supply, the local Coop and the fairly local Waitrose, are both relative good guys on this subject.
I heard a farmer on the radio saying that he felt let down – I think he felt let down by just about everybody but I noted that he included farmers’ leaders in the list. I wonder whether NFU President, Peter Kendall, has ever milked a herd of cows (and since you might be wondering – I have (although not very often and not very expertly))? The NFU is now trying hard to look as though it is leading the charge on this subject.
A few thoughts:
I thought we needed to feed the world – clearly the world doesn’t want to drink milk. If the price of milk is very low then it suggests that we have too much milk and that is true whether that milk is produced in the UK or abroad.
If farmers are receiving less for their milk than the cost of production then surely they should move into some other form of production which pays better. If this sounds harsh then would it sound harsh if we were talking about any other business?
Remember that all farmers (almost all farmers) receive direct income-support payments from you in addition to the price they get for their produce. Those payments are what are keeping many dairy farms afloat these days so you are contributing to farmers’ incomes already through your taxes before you go shopping. However, that income support could also be seen as a factor which prevents change in the farming sector. This government tends to look at the income support given to the jobless as a factor which prevents them getting out and looking for a job. The income support given to farmers tends to lessen the incentive for change in the farming community too.
By Stefan Kühn (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html), CC-BY-SA-3.0 (http://creativecommons.org/licenses/by-sa/3.0/) or CC-BY-SA-2.5-2.0-1.0 (http://creativecommons.org/licenses/by-sa/2.5-2.0-1.0)], via Wikimedia CommonsThe apparent stranglehold of the supermarkets on the price of milk is partly a consequence of specialisation of UK farming. If more farms were mixed then they would be buffered against the rises and falls of different commodities – and they might also be producing more of their own animal feed and so be buffered against rises in input costs too.
If supermarkets were getting the best possible deal on radios and passing that on to you the consumer so that you get cheap radios would you feel sorry for radio manufacturers?
I grew up in a dairy area and when I go back to Somerset I am shocked by the lack of wildlife in the countryside. Yes, the land is green but it isn’t all that pleasant in many places. Some conservationists call the dairy landscape of counties such as Cheshire and Devon ‘green concrete’. High fertiliser use and frequent silage cutting make those bright green fields tough places for hares, lapwings or skylarks.
Any dairy farmer who put a proportion of his land into agri-environment schemes must feel a little bit relieved that that source of income is secure over the term of the agreement. It’s another form of mixed farming and not putting all your eggs in one basket.
The price of land hasn’t fallen and hardly ever does. Many dairy farmers are income-poor and capital-rich – they aren’t in quite the same position as classroom assistants or nurses on low pay. When you see farmers protesting at their treatment you are sometimes looking at businessmen with assets of millions of pounds.
I guess that all sounds quite unsympathetic but I do have sympathy for dairy farmers. It’s hard work milking a herd of cows twice a day, every day. But the plight of the dairy farmer is a product of the way that agriculture works and it works in a range of different ways. Farming is a business and the businessmen who are dairy farmers have more options and more public support than many other small businesses and certainly more options than many public service workers.
When you hear people like Lord Haskins and the Agriculture Minister talking about the industry changing what they really mean, but don’t say, is that there are too many small farms which aren’t very efficient in simple economic terms. The plight of the small family dairy farmer is the same plight as the small family grocer’s shop. If you are a hard hearted market-lover (which I am not) then the plight of the small dairy farmer is the market working, rather slowly, to drive efficiency into the industry.
But as I often say in this blog – farming isn’t like every other industry. The difference is the environmental impact. If small dairy farmers were able to prove that their method of farming provided more public goods than those provided by the forces of the market efficiency then they would have a good case for public support. I don’t know evidence like that and i haven’t heard anyone even mentioning it in this case.
Is farming a business like any other? If it is, then we shouldn’t shed too many tears for the dairy industry. But is it?
[registration_form]
34 Replies to “The milk of human kindness”
I’m interested in why Peter Kendal and the NFU are ‘backing’ British dairy farmers over this one, yet several weeks ago they were saying how fantastic the Nocton super dairy would be – surely if this went ahead on a factory scale it would put many of those protesting farmers they say they support out of bussiness overnight and drive milk prices lower?
good one Mark. Had I not been leaving TGT I would have written a very similar piece on their blog.
A couple of additional thoughts/info.
Dairy farmers claim they get no subsidy for producing milk. This is misleading – no farmer receives subsidies to produce food any more since CAP subsidies were decoupled in 2003. We’re now in the arguably crazy situation where farmers get CAP subsidies whether they produce food or not – and all they have to do is “manage” the land which as far as the EC is concerned means running a topper over it, if its pasture.
The average dairy farmer receives £32,300 a year in CAP subsidy, according to a parliamentary written answer in 2011( Link is http://www.theyworkforyou.com/wrans/?id=2011-02-17a.41118.h&s=dairy+farm+subsidy#g41118.q0). This is mostly (£27,300) in the form of single payment, with a small amount of ELS (£4000) (and an even smaller amount of HLS) plus a bit for other things like Bovine TB compensation.
The average dairy farmer produces around 1.2 Million litres per year, so the subsidy paid by the taxpayer on a litre of milk is 27p. The average price paid to a farmer for their milk in january 2012 was 29p. And, according to the BBC website the farmers average production costs are apparently 29.5p per litre – presumably this takes into account the 27p a litre subsidy. So it doesnt take a mathematical genius to spot what’s going on – the buyers are factoring in the subsidy when calculating their buying price – and pocketing the subsidy we have paid to the farmers.
The subsidy in these decoupled times is supposed to provide a payment in return for the farmer farming according to a set of rules called GAEC (good agricultural and environmental condition). In theory this includes things like protecting wildlife, not polluting water courses etc. In practice of course this is not policed and left to the morals of the farmer. Many farmers have high moral values but when financial pressures are so high, morals have to take a back seat.
Dairy farmers work the land more intensively than beef or sheep farmers – as you say Mark this is driven by the market and the need to increase efficiency ie milk output per cow. While grass may be part of the diet of some dairy cows (either as forage or silage), maize is actually the main forage crop they eat, combined with cereals or soy. Dairy farming is now arguably mainly an arable system – its just that the arable crops are fed to cows to make milk. Maize is probably the most damaging crop in the British countryside – it requires large levels of artificial fertiliser and pesticide and because the stubble is often left overwinter can also lead to problems with soil erosion and watercourse pollution. It is also very bad for wildlife.
The solution? In the short term buy organic milk. The farmers get a fairer deal, the countryside isn’t so badly trashed, the cows are happier.
In the long term the CAP has to be reformed so it only pays for environmental public goods; and the dairy farmers need to work collectively to drive a better bargain with the buyers. Collective bargaining? Isn’t that what the unions are for – evidently the NFU is not a Union in that sense.
You make some very good points Miles (as does Mark) and I’m sorry to hear that you leaving TGT, but I feel I should pick you up on some of your comments about forage maize.
Yes it is true that on many large intensive units, maize along with other forage crops does form a substantial proportion of the farmed area, particularly in the south. However in my experience, the majority of dairy farms in the NW and WM grow maize on between 10-30% of the farmed area and it generally never makes up more than 30% of the diet ration.
To cite maize as being probably the most damaging crop in the British countryside is also wide of the mark. A 40t/ha Maize crop never needs more than 150kg/ha of Nitrogen, though in most cases it will receive less than half of this amount and in some cases e.g. when following ploughed out intensive lays needs no more than 20kg/ha. Compare this with the typical nitrogen fertiliser policy on a 47t/ha 3-cut silage system and it is fairly common to find application rates in excess of 300 kg/ha N.
The problem with maize is when it is grown badly and on the same land for too long, however the dairy industry has made a lot of progress in this respect during the last few years. Many farmers are now selecting earlier harvesting varieties which allow them to remove the crop much earlier, significantly reducing the risk of soil damage and allowing the stubble to be either sown with another crop or rough cultivated to reduce the risk of soil erosion.
I would also point that in many parts of the NW and WM the late spring tillage provided by maize crops are frequently the only areas of farmland that offer lapwings potential (albeit sub-optimal) nesting opportunities. In fact I dread to think of what would happen to the lapwing population of Cheshire and North Shropshire, if dairy farmers ceased growing maize and grew intensive grass or winter wheat instead.
Joe – thank you, I found that very informative.
It is true that the nitrogen requirement of maize is not high, but unlike other crops maize tolerates an oversupply – usually from slurry – without falling over. This was one of the reasons for its initial popularity – a good place to ditch your slurry. Maize is like any other row crop – does badly unless kept free from weeds. You could look in vain for a weed in some maize stubbles – although the withdrawal of atrazine was a good thing and long overdue, the replacement active ingredients are not without impacts.
As for the most damaging crops – sugar beet (herbicide burden, soil compaction), potatoes (N-leaching, de-stoning, compaction), Oilseed Rape (N-leaching, insecticide, desiccant burden) – take your pick.
On the plus side maize only needs harvesting once, unlike conserved grass, and it holds its digestibility for a long time, allowing more flexibility in harvest date and conditions, unlike conserved grass.
It also provides cover for abandoned cars and escaped felons.
to Joe W and Filbert
Maize fields provide a valuable food source for overwintering whooper swans and Pinkfeet geese, more so if the stubble is allowed to green up in the Springtime.
Sugarbeet waste is I believe also a valuable food source for tens of thousands of pinkfeet geese during the winter
Miles suggests that the average dairy farmer receives 27p per litre in subsidy.
Can we just go over that calculation again please?
That’s £32300 divided by 1.2 million litres – PLEASE CHECK YOUR MATHS AND CORRECT IT
The UK Dairy protests have made the news in France, mainly because there were protests in France very recently, which saw farmers emptying their milk onto the roads in the centre of some towns including here in Poitiers – where a hurried massive clean up operation to prevent the milk entering and destroying the ecology of the Clain was impressive, but the farmers got what they wanted, for now. But as reported here and then watching the UK news and the quibbling over a few pence – the link used by the processors and supermarkets that the worldwide price of milk has gone down dramatically do not parry with the costs on the shelves here: Fresh milk (not the UHT stuff, a significant amount of which comes in from the US now), is more than 75p per 500ml. Thus proving surely (and certainly hinted at in French journals) that using a global price index for milk is tenuous and a potential vehicle for corruption particularly for a country like the UK where fresh milk is considered the norm and not a luxury item as most of the rest of the world do. Something doesn’t smell right and it isn’t the milk. And when the PM orders his next cream tea made from US superfarmed UHT milk surrounded by an unmanaged Devon or Cornwall landscape maybe he will realise how important this issue is, at the same time as realising that Danny Boyle’s celebration of the rural landscape at the olympics was actually an obituary.
Plus when watching Peter Kendall on BBC news all I could concentrate on was his very expensive suit – even if he is understanding of this issue, he doesn’t look as if he is and would be more comfortable in the pseudo plaza’s in the shade of Canary Wharf.
Pip – your comments, and French perspective, are always very welcome here. Thank you.
Accepting a lot of your comments I just want to make the point, knowing as I do a few dairy farmers, that it is not easy to change to arable or livestock farming. There is a lot of specific, costly infrastructure in place not to mention all the expertise that is required / waste during any change. I’m not saying that moving to another form of farming is impossible but that there are a lot of difficulties in doing so. In addition often being a dairy (or other type of) farmer is a big part of a families idenity and changing that is as hard as anything.
Jonathan – I agree completely, and I understand all that. The cultural aspect is important – and applied to shipbuilders, miners etc in the past. It isn’t easy to change your system of farming, but then if you don’t you get trapped in a time warp. It is tricky. the cultural tie is a very strong one, but if you are sitting on assets (land) worth lots of money then there is a way out – sell up. And that will be a way that the structure and shape of the industry will change – and has been happening for years, of course.
Lots of interesting points here that I hadn’t previously considered.
Lowering the amount for money paid to dairy farmers worries me in that it is likely lead to lower animal welfare and more proposals for intensive dairy farms.
I do wonder where all this price cutting is stemming from. Are the general public demanding cheap milk? Not that I’m aware of. Whilst everybody would prefer to pay less for something, do people really stop buying milk if the price goes up by a few pence?
Most of the milk that I buy is organic and delivered by my milkman. However I do buy some UHT, & was surprised to read that it could be coming from the US.
Bernie – welcome and thank you.
Hi Mark,bet you expect me to have a go at your blog,well not going to at all as my gripe is bigger than yours and something you probably know nothing about.
In the mid 90s a large group of farmers put money in to set up the most modern dairy in Europe with a chief executive to run it and this was with good access to at least half the country based at Melksham in Wilts.What they needed was lots of farmers to join and sell their milk even if not investing in the dairy.
Of course whatever the new dairy would pay the major processors made sure to pay a halfpenny a litre more knowing that without that milk the new dairy would fail.
For such a small short term gain farmers have lost out on having their own large co-op with massive bargaining power so how can they expect sympathy,they are now reaping what they have sown.
Dennis – well, yes, you are right, I did expect you to have a go at me (sensitive soul that I am).
Your point is a very good one – thank you for making it. That is the other way that farmers could (should?) go – get more clout through pooling resources. The example you give is a very good one of short term profit (can we call that greed?) winning over long term profit (could we call that prudence?).
Thank you for your comment.
Shouldn’t that kind of co-operative venture that protects the interest of their members be the sort of venture the National Farmers Union should be taking a lead in, instead of banging on about world trade and screwing subsidies?
It never fails to amaze me that I can buy a pint of cool refreshing milk, cheaper than a bottle of water. Something is arse about face somewhere and I suspect that Miles’ point about subsidies is at the heart of it.
Phil – interesting points
Always remember Mark you said something that made a big impact and made me feel humble when I think you said in a type of reviewing your book about your RSPB blogs that Sooty commented often and strangely if he disagreed it did matter to you.Somewhere that tough exterior that you undoubtedly need for past and present jobs there is a soft centre.
Daughter ordered your book for me yesterday.
Dennis – thank you1 Hope you enjoy the book – I think you will.
The retail price of milk has dropped phenomenally, probably more so than any other basic product: in 1938 it took an average worker more than 20 minutes to earn the price of a litre of milk; by 1970 this was down to 8½ minutes and the 1994 deregulation of the milk market saw another large drop. Now (2012), supermarkets sell a litre of milk for less than 4½ minutes of a worker’s time at today’s minimum wage, and bottled water at twice that price!
It is perhaps not surprising that from 1985 to 2005 the number of Cheshire dairy farms halved, from 1748 to 887, dropping further to 566 in 2010. The number of dairy cows has fallen less steeply, however, as farms became larger to meet the economies of scale, with the average number of cows per dairy farm doubling (from 83 to 167) in the quarter-century 1985 to 2010.
So, yes, the dairy industry has changed and is changing, with most (in Cheshire anyway) getting out, and the remainder getting bigger to get the economies of scale. As Joe W says, most of their food is grass, either fresh or as silage. Maize doesn’t grow well here (and was all-but unknown twenty years ago, before the climate warmed and different varieties were introduced). But the heavily-fertilised ryegrass fields, often cut four times a year for silage, are indeed dreadful for wildlife. Some farmers have taken up the field-margin stewardship options on uncropped 6-metre strips and hedgerows – but the species that ought to be in the centres of the fields are gone.
But thanks, Mark, for mentioning pastoral agriculture. If only you could persuade your former colleagues at Sandy to get away from their obsession that agriculture = arable, a bit more lobbying from them, and indeed a demonstration farm (Hope Dairy Farm?) might achieve some wildlife gains in the pastoral sector.
I find it amazing that in the same breath you can be called a ‘townie idiot’ by a farmer and then be expected to support British farming.
Thing is this decison to cut milk price was not made over night I presume? So how do you butter up (excuse the pun) dairy farmers?
Hmmm, I suppose a cull of some sort might ease the annoucement, keep them distracted.
Anyone know of any culls of native animals farmers have been asking to be killed for a while….?
Not that it worked mind…..!
As usual the farming community are ‘furious’ about it, but are ‘nt they furious about everything according to the farming press headlines? The ones I meet seem alright and quite laid back.
As a townie with no ties to farming, other than that my grandfather originated from one, I am offended every time the farming side is furious over the low profits/big losses/hard life because of low prices in the shop, because I have not asked for cheap meat, cheap grain, cheap milk. I think I am not alone in wanting good, safe food, the production of which provides work for my fellow people, and knowing that the animals were treated right and proper, and that the environment is being looked after. If in the past it took about a day’s efforts to find/earn food for the table for that day, how have we come to this point, where it should practically cost nothing to us? How’s cheap food become a human right? Food maybe, but cheap food?
I want happy, educated farmers that get, shall we say sustainably wealthy, wealth being better than poverty in a thousand ways. But I don’t want business agriculture, efficient farming, “big ag”. I pay taxes gladly to support farming, but not big ag.
On a footnote, shops like to say that they stock what people want, as if that washes away their responsibility over what they stock.
You could argue that everyone’s individually responsible for being a conscious consumer, but that’s not reality.
What if shops started “aggressively” promoting good farming, happy animals, safe environments, instead of cheap meat and milk? On a large scale, not just some hard-to-find shops for those who can/will go out of their way to find such shops. How come it isn’t a shop’s responsibility to be conscious?
I do think however that Miles idea about calculating the amount of subsidy dairy farmers receive is probably up the creek without a paddle of any sort.
Reason is suppose a farmer has 3,000 acres with 300 devoted to dairy farming which would allow him even then to have a above average herd size so I am not exaggerating then I suspect that in the answer he is quoting the subsidy was for all the crops on whole farm whereas it should have been simply for the 300 acres devoted to the dairy exactly one tenth of the acreage.
Think it is a case of figures can be used to prove absolutely nothing.
We certainly need correct information before believing these figures and my guess is they do not exist.
The only figures that would mean anything would be the figure for farms that were entirely dairy farms.
Mark,
Very interesting piece, which cleverly highlights the major conflicts at the heart of this issue. To respond correctly to market forces requires financial consideration only, with no account taken of the social and environmental impact of the choices made, other than in terms of their financial costs (redundancy, training for new skills, costs of new buildings and new inputs to replace current systems etc ). Farming does not fit this business stereotype. The farmer generally has a large social investment in the farm, seeing it as a lifestyle choice as much as a career. Unsociable hours go hand in hand with working outdoors and enjoying life in the countryside. This is not an easily tradeable asset. Historically there have always been large communities of workers and families linked to the farm. Mechanisation has reduced this, but management of the countryside around people’s living spaces gives everyone a vested interest in the farmed environment. Minimum staff means concentration of labour skills in a few key workers – hiring and firing these as you chop and change enterprises is not a sustainable option for family businesses. The social impact of farming is still considerable.
Equally, the environmental impact is substantial and possibly the strongest argument as to why market forces are malignant here. Each farm takes account of its own soil types, landscape features, rainfall and aspect. Only the soil type can be modified through the addition of organic matter etc – everything else is left to Mother Nature. Not all farms can grow grass well. Not all farms can grow maize well. Not all farms can grow wheat well. However, market forces have led to the specialisation of farms in many regards. One type of livestock only, only arable, only dairy. Most farms have been pushed into a situation where they have no choice but to be overly exposed to market forces. They can’t now switch to another system altogether – the infrastructure costs are phenomenal, and where is the certainty that the grass will be greener on the other side? What other enterprises offers any more stability than the current one? What other enterprises could work on the individual farm and fields in question?
The question is one of sustainability. If you want to move back to a situation where farmers dont have to have all their eggs in one basket, can diversify their cropping for the benefit of the environment and society, can invest in their businesses to make them as efficient as possible…. Well, I think it can only be done with some form of market intervention.
From our point of view, we a small mixed dairy and arable farm in norfolk. We are an historical anomaly – a product of a curious generational twist that left an abundance of family members able to excell at their chosen, and mutually beneficial, careers. We are doing ok, but we have a vested interest in all the other dairy farms in Norfolk doing ok too. If they don’t, there will be no vets, no dairy supplies, no dairy-cross beef farmers, no milk tanker to collect our milk, and no future for us. We are all in this together.
Emily – welcome, and I’m very grateful to you for that knowledgeable and personal account. Many thanks. Please come back and comment again now and again if you can.
Before we joined the EEC and had to accept CAP, Britain had a simple way of supporting farmers. In times of scarcity the price of the basic food was allowed to rise with the market. But in times of plenty there was a floor below which a subsidy kicked in to give the farmer a minimum basic price, which was indeed pretty basic. This kept farmers afloat, while encouraging more production only when a foodstuff was in short supply – unlike the old CAP which kept buying at a relatively high price to produce milk lakes and so on.
I’m surprised no-one is suggesting moving back to such a scheme – but not being a farmer myself I don’t really know if it worked as it should have. Any readers old enough to remember this?
Oh, and I must mention that our village shop sometimes has real bottles of Gold Top at £1 a pint, which are snapped up by us locals as soon as they hit the shelf. Message to dairy farmers: more Gold Top please (but don’t tell my heart specialist…).
Coop only just saved their bacon in the nick of time last week by upping the price 2.5 p. Could someone please confirm or otherwise . Do we import a lot of cheap milk into the UK from France?. I know you have to look hard to find a pack of butter that actually says it is made from British Milk. Labeling has always been a problem. Alot of pork is brought into the UK and processed here so therefore called British and labelled as such.
I really interesting blog to read and I agree with the vast amount that has been said, especially from Emily who made her case brilliantly.
The one point that hasn’t been mentioned is that regardless of people’s views on farming no one can support what is basically a supply chain and market model in liquid milk which is malignant. Supermarkets have a very complex marketing strategy which discounts certain basic products such as milk and bread and relies on selling added value products (own brands) at large mark-ups. A simple trip round any chain clearly shows how store layout and clever marketing has led to vast profits from companies who claim to be saving you money every day. The reality is very different. Because of the relatively simple supply chain involved in liquid milk it has become very easy for the multiples to pass some of the cost of their loss leading strategies down the supply chain without much opposition. They do this regularly with fresh produce and have a well-documented history of exploiting suppliers. Other basic food stuffs such as wheat are less affected since the supply chain is more complex but we have seen the milling industry under severe pressure earlier this year with the closure of one on the main millers due to these tactics.
Emily makes a very good point in that we are all in this together from arable farmers like me down to NGO’s as such a distorted market can only accelerate the massive changes that we have seen in UK farming over the last two decades. It is probably too late but at least the dairy farmers are the best example of family owned farming businesses we have and for that reason they deserve our full support under these circumstances.
Julian
Julian – thank you.
An interesting article Mark, I’m a dairy farmer but I do believe it’s right to ask tricky questions rather than shy away from them. It’s particularly interesting to compare, as you do, our dairy farms with other businesses. There are many points I would find it difficult to argue.
Reading the comments is also enlightening and flags up a vast array of issues surrounding a varied sector within the confusing and sometimes contradictory world that is modern farming. There are a lot of points being thrown into the mix, which can make it easy to forget where the discussion began.
I think many farmers would agree that the dairy industry has to be sustainable, that markets rule and that prices cannot be set artificially high. I think the point that dairy farmers are trying to make is that the industry must be allowed to be sustainable, corporations must be responsible and their actions moral, and trade must be ethical. Dairy farming doesn’t need to be singled out for special treatment it just needs fair treatment.
Without wanting to waffle on for too long, I’d also just like to highlight the role of dairy farming in supporting the mixed farming system that dominates vast swathes of the UK’s less favourable farmland- a system that allows me to have healthy, happy dairy cows and Tree Sparrows. It’s not all about green concrete and mega dairies.
Farmland birds – many thanks.
Some very interesting opinions and I particularly enjoyed reading Emily’s excellent comments, particularly the comment about the need to support mixed farming.
I’m not sure how mixed farming could be supported by market intervention, but I’ve always thought that the Single Payment Scheme (SPS) should do more to incentivise mixed farming possibly through the introduction of a ‘a mixed farming premium’ for smaller farms.
It does strike me that currently the SPS disincentivises mixed farming. Anybody with a reasonable knowledge of the Cross Compliance rules will appreciate that the burden of Cross Compliance record keeping lies with mixed farms, generally speaking for specialist arable farms the Cross Compliance rules are a doddle. For instance in the last few years 62 – 70% of reported Cross Compliance failures were cattle related. I also know from experience that some specialist arable producers have been detered from keeping cattle in order to manage grassland habitats on their farms due to the perceived liability to their combined SPS/ES payments. This burden of paperwork is not so much of a problem for larger farm businesses, they can afford to pay a farm secretary to sort it out for them or extra staff to allow them to sort it out themselves, however for smaller family farms which have incredible pressures on available time it really is not so easy.
A ‘mixed farming premium’ could help to ease this burden. The more diverse the farming system, the higher the mixed farming premium payment would be. I feel that this type of mixed farming incentive would also help to deliver many of the aims and objectives of Environmental Stewardship and could actually prove more effective than ELS in some parts of the country.
Joe – interesting points. Thank you.
Comments are closed.
This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish.AcceptRejectRead More
Privacy & Cookies Policy
Privacy Overview
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
I’m interested in why Peter Kendal and the NFU are ‘backing’ British dairy farmers over this one, yet several weeks ago they were saying how fantastic the Nocton super dairy would be – surely if this went ahead on a factory scale it would put many of those protesting farmers they say they support out of bussiness overnight and drive milk prices lower?
good one Mark. Had I not been leaving TGT I would have written a very similar piece on their blog.
A couple of additional thoughts/info.
Dairy farmers claim they get no subsidy for producing milk. This is misleading – no farmer receives subsidies to produce food any more since CAP subsidies were decoupled in 2003. We’re now in the arguably crazy situation where farmers get CAP subsidies whether they produce food or not – and all they have to do is “manage” the land which as far as the EC is concerned means running a topper over it, if its pasture.
The average dairy farmer receives £32,300 a year in CAP subsidy, according to a parliamentary written answer in 2011( Link is http://www.theyworkforyou.com/wrans/?id=2011-02-17a.41118.h&s=dairy+farm+subsidy#g41118.q0). This is mostly (£27,300) in the form of single payment, with a small amount of ELS (£4000) (and an even smaller amount of HLS) plus a bit for other things like Bovine TB compensation.
The average dairy farmer produces around 1.2 Million litres per year, so the subsidy paid by the taxpayer on a litre of milk is 27p. The average price paid to a farmer for their milk in january 2012 was 29p. And, according to the BBC website the farmers average production costs are apparently 29.5p per litre – presumably this takes into account the 27p a litre subsidy. So it doesnt take a mathematical genius to spot what’s going on – the buyers are factoring in the subsidy when calculating their buying price – and pocketing the subsidy we have paid to the farmers.
The subsidy in these decoupled times is supposed to provide a payment in return for the farmer farming according to a set of rules called GAEC (good agricultural and environmental condition). In theory this includes things like protecting wildlife, not polluting water courses etc. In practice of course this is not policed and left to the morals of the farmer. Many farmers have high moral values but when financial pressures are so high, morals have to take a back seat.
Dairy farmers work the land more intensively than beef or sheep farmers – as you say Mark this is driven by the market and the need to increase efficiency ie milk output per cow. While grass may be part of the diet of some dairy cows (either as forage or silage), maize is actually the main forage crop they eat, combined with cereals or soy. Dairy farming is now arguably mainly an arable system – its just that the arable crops are fed to cows to make milk. Maize is probably the most damaging crop in the British countryside – it requires large levels of artificial fertiliser and pesticide and because the stubble is often left overwinter can also lead to problems with soil erosion and watercourse pollution. It is also very bad for wildlife.
The solution? In the short term buy organic milk. The farmers get a fairer deal, the countryside isn’t so badly trashed, the cows are happier.
In the long term the CAP has to be reformed so it only pays for environmental public goods; and the dairy farmers need to work collectively to drive a better bargain with the buyers. Collective bargaining? Isn’t that what the unions are for – evidently the NFU is not a Union in that sense.
You make some very good points Miles (as does Mark) and I’m sorry to hear that you leaving TGT, but I feel I should pick you up on some of your comments about forage maize.
Yes it is true that on many large intensive units, maize along with other forage crops does form a substantial proportion of the farmed area, particularly in the south. However in my experience, the majority of dairy farms in the NW and WM grow maize on between 10-30% of the farmed area and it generally never makes up more than 30% of the diet ration.
To cite maize as being probably the most damaging crop in the British countryside is also wide of the mark. A 40t/ha Maize crop never needs more than 150kg/ha of Nitrogen, though in most cases it will receive less than half of this amount and in some cases e.g. when following ploughed out intensive lays needs no more than 20kg/ha. Compare this with the typical nitrogen fertiliser policy on a 47t/ha 3-cut silage system and it is fairly common to find application rates in excess of 300 kg/ha N.
The problem with maize is when it is grown badly and on the same land for too long, however the dairy industry has made a lot of progress in this respect during the last few years. Many farmers are now selecting earlier harvesting varieties which allow them to remove the crop much earlier, significantly reducing the risk of soil damage and allowing the stubble to be either sown with another crop or rough cultivated to reduce the risk of soil erosion.
I would also point that in many parts of the NW and WM the late spring tillage provided by maize crops are frequently the only areas of farmland that offer lapwings potential (albeit sub-optimal) nesting opportunities. In fact I dread to think of what would happen to the lapwing population of Cheshire and North Shropshire, if dairy farmers ceased growing maize and grew intensive grass or winter wheat instead.
Joe – thank you, I found that very informative.
It is true that the nitrogen requirement of maize is not high, but unlike other crops maize tolerates an oversupply – usually from slurry – without falling over. This was one of the reasons for its initial popularity – a good place to ditch your slurry. Maize is like any other row crop – does badly unless kept free from weeds. You could look in vain for a weed in some maize stubbles – although the withdrawal of atrazine was a good thing and long overdue, the replacement active ingredients are not without impacts.
As for the most damaging crops – sugar beet (herbicide burden, soil compaction), potatoes (N-leaching, de-stoning, compaction), Oilseed Rape (N-leaching, insecticide, desiccant burden) – take your pick.
On the plus side maize only needs harvesting once, unlike conserved grass, and it holds its digestibility for a long time, allowing more flexibility in harvest date and conditions, unlike conserved grass.
It also provides cover for abandoned cars and escaped felons.
to Joe W and Filbert
Maize fields provide a valuable food source for overwintering whooper swans and Pinkfeet geese, more so if the stubble is allowed to green up in the Springtime.
Sugarbeet waste is I believe also a valuable food source for tens of thousands of pinkfeet geese during the winter
Miles suggests that the average dairy farmer receives 27p per litre in subsidy.
Can we just go over that calculation again please?
That’s £32300 divided by 1.2 million litres – PLEASE CHECK YOUR MATHS AND CORRECT IT
The UK Dairy protests have made the news in France, mainly because there were protests in France very recently, which saw farmers emptying their milk onto the roads in the centre of some towns including here in Poitiers – where a hurried massive clean up operation to prevent the milk entering and destroying the ecology of the Clain was impressive, but the farmers got what they wanted, for now. But as reported here and then watching the UK news and the quibbling over a few pence – the link used by the processors and supermarkets that the worldwide price of milk has gone down dramatically do not parry with the costs on the shelves here: Fresh milk (not the UHT stuff, a significant amount of which comes in from the US now), is more than 75p per 500ml. Thus proving surely (and certainly hinted at in French journals) that using a global price index for milk is tenuous and a potential vehicle for corruption particularly for a country like the UK where fresh milk is considered the norm and not a luxury item as most of the rest of the world do. Something doesn’t smell right and it isn’t the milk. And when the PM orders his next cream tea made from US superfarmed UHT milk surrounded by an unmanaged Devon or Cornwall landscape maybe he will realise how important this issue is, at the same time as realising that Danny Boyle’s celebration of the rural landscape at the olympics was actually an obituary.
Plus when watching Peter Kendall on BBC news all I could concentrate on was his very expensive suit – even if he is understanding of this issue, he doesn’t look as if he is and would be more comfortable in the pseudo plaza’s in the shade of Canary Wharf.
Pip – your comments, and French perspective, are always very welcome here. Thank you.
Accepting a lot of your comments I just want to make the point, knowing as I do a few dairy farmers, that it is not easy to change to arable or livestock farming. There is a lot of specific, costly infrastructure in place not to mention all the expertise that is required / waste during any change. I’m not saying that moving to another form of farming is impossible but that there are a lot of difficulties in doing so. In addition often being a dairy (or other type of) farmer is a big part of a families idenity and changing that is as hard as anything.
Jonathan – I agree completely, and I understand all that. The cultural aspect is important – and applied to shipbuilders, miners etc in the past. It isn’t easy to change your system of farming, but then if you don’t you get trapped in a time warp. It is tricky. the cultural tie is a very strong one, but if you are sitting on assets (land) worth lots of money then there is a way out – sell up. And that will be a way that the structure and shape of the industry will change – and has been happening for years, of course.
Lots of interesting points here that I hadn’t previously considered.
Lowering the amount for money paid to dairy farmers worries me in that it is likely lead to lower animal welfare and more proposals for intensive dairy farms.
I do wonder where all this price cutting is stemming from. Are the general public demanding cheap milk? Not that I’m aware of. Whilst everybody would prefer to pay less for something, do people really stop buying milk if the price goes up by a few pence?
Most of the milk that I buy is organic and delivered by my milkman. However I do buy some UHT, & was surprised to read that it could be coming from the US.
Bernie – welcome and thank you.
Hi Mark,bet you expect me to have a go at your blog,well not going to at all as my gripe is bigger than yours and something you probably know nothing about.
In the mid 90s a large group of farmers put money in to set up the most modern dairy in Europe with a chief executive to run it and this was with good access to at least half the country based at Melksham in Wilts.What they needed was lots of farmers to join and sell their milk even if not investing in the dairy.
Of course whatever the new dairy would pay the major processors made sure to pay a halfpenny a litre more knowing that without that milk the new dairy would fail.
For such a small short term gain farmers have lost out on having their own large co-op with massive bargaining power so how can they expect sympathy,they are now reaping what they have sown.
Dennis – well, yes, you are right, I did expect you to have a go at me (sensitive soul that I am).
Your point is a very good one – thank you for making it. That is the other way that farmers could (should?) go – get more clout through pooling resources. The example you give is a very good one of short term profit (can we call that greed?) winning over long term profit (could we call that prudence?).
Thank you for your comment.
Shouldn’t that kind of co-operative venture that protects the interest of their members be the sort of venture the National Farmers Union should be taking a lead in, instead of banging on about world trade and screwing subsidies?
It never fails to amaze me that I can buy a pint of cool refreshing milk, cheaper than a bottle of water. Something is arse about face somewhere and I suspect that Miles’ point about subsidies is at the heart of it.
Phil – interesting points
Always remember Mark you said something that made a big impact and made me feel humble when I think you said in a type of reviewing your book about your RSPB blogs that Sooty commented often and strangely if he disagreed it did matter to you.Somewhere that tough exterior that you undoubtedly need for past and present jobs there is a soft centre.
Daughter ordered your book for me yesterday.
Dennis – thank you1 Hope you enjoy the book – I think you will.
The retail price of milk has dropped phenomenally, probably more so than any other basic product: in 1938 it took an average worker more than 20 minutes to earn the price of a litre of milk; by 1970 this was down to 8½ minutes and the 1994 deregulation of the milk market saw another large drop. Now (2012), supermarkets sell a litre of milk for less than 4½ minutes of a worker’s time at today’s minimum wage, and bottled water at twice that price!
It is perhaps not surprising that from 1985 to 2005 the number of Cheshire dairy farms halved, from 1748 to 887, dropping further to 566 in 2010. The number of dairy cows has fallen less steeply, however, as farms became larger to meet the economies of scale, with the average number of cows per dairy farm doubling (from 83 to 167) in the quarter-century 1985 to 2010.
So, yes, the dairy industry has changed and is changing, with most (in Cheshire anyway) getting out, and the remainder getting bigger to get the economies of scale. As Joe W says, most of their food is grass, either fresh or as silage. Maize doesn’t grow well here (and was all-but unknown twenty years ago, before the climate warmed and different varieties were introduced). But the heavily-fertilised ryegrass fields, often cut four times a year for silage, are indeed dreadful for wildlife. Some farmers have taken up the field-margin stewardship options on uncropped 6-metre strips and hedgerows – but the species that ought to be in the centres of the fields are gone.
But thanks, Mark, for mentioning pastoral agriculture. If only you could persuade your former colleagues at Sandy to get away from their obsession that agriculture = arable, a bit more lobbying from them, and indeed a demonstration farm (Hope Dairy Farm?) might achieve some wildlife gains in the pastoral sector.
I find it amazing that in the same breath you can be called a ‘townie idiot’ by a farmer and then be expected to support British farming.
Thing is this decison to cut milk price was not made over night I presume? So how do you butter up (excuse the pun) dairy farmers?
Hmmm, I suppose a cull of some sort might ease the annoucement, keep them distracted.
Anyone know of any culls of native animals farmers have been asking to be killed for a while….?
Not that it worked mind…..!
As usual the farming community are ‘furious’ about it, but are ‘nt they furious about everything according to the farming press headlines? The ones I meet seem alright and quite laid back.
As a townie with no ties to farming, other than that my grandfather originated from one, I am offended every time the farming side is furious over the low profits/big losses/hard life because of low prices in the shop, because I have not asked for cheap meat, cheap grain, cheap milk. I think I am not alone in wanting good, safe food, the production of which provides work for my fellow people, and knowing that the animals were treated right and proper, and that the environment is being looked after. If in the past it took about a day’s efforts to find/earn food for the table for that day, how have we come to this point, where it should practically cost nothing to us? How’s cheap food become a human right? Food maybe, but cheap food?
Who’s the real culprit?
This morning I read Mark’s blog about milk; and just now I read an article in the OnEarth magazine: http://www.onearth.org/article/the-barnstormer
I want happy, educated farmers that get, shall we say sustainably wealthy, wealth being better than poverty in a thousand ways. But I don’t want business agriculture, efficient farming, “big ag”. I pay taxes gladly to support farming, but not big ag.
On a footnote, shops like to say that they stock what people want, as if that washes away their responsibility over what they stock.
You could argue that everyone’s individually responsible for being a conscious consumer, but that’s not reality.
What if shops started “aggressively” promoting good farming, happy animals, safe environments, instead of cheap meat and milk? On a large scale, not just some hard-to-find shops for those who can/will go out of their way to find such shops. How come it isn’t a shop’s responsibility to be conscious?
I do think however that Miles idea about calculating the amount of subsidy dairy farmers receive is probably up the creek without a paddle of any sort.
Reason is suppose a farmer has 3,000 acres with 300 devoted to dairy farming which would allow him even then to have a above average herd size so I am not exaggerating then I suspect that in the answer he is quoting the subsidy was for all the crops on whole farm whereas it should have been simply for the 300 acres devoted to the dairy exactly one tenth of the acreage.
Think it is a case of figures can be used to prove absolutely nothing.
We certainly need correct information before believing these figures and my guess is they do not exist.
The only figures that would mean anything would be the figure for farms that were entirely dairy farms.
Mark,
Very interesting piece, which cleverly highlights the major conflicts at the heart of this issue. To respond correctly to market forces requires financial consideration only, with no account taken of the social and environmental impact of the choices made, other than in terms of their financial costs (redundancy, training for new skills, costs of new buildings and new inputs to replace current systems etc ). Farming does not fit this business stereotype. The farmer generally has a large social investment in the farm, seeing it as a lifestyle choice as much as a career. Unsociable hours go hand in hand with working outdoors and enjoying life in the countryside. This is not an easily tradeable asset. Historically there have always been large communities of workers and families linked to the farm. Mechanisation has reduced this, but management of the countryside around people’s living spaces gives everyone a vested interest in the farmed environment. Minimum staff means concentration of labour skills in a few key workers – hiring and firing these as you chop and change enterprises is not a sustainable option for family businesses. The social impact of farming is still considerable.
Equally, the environmental impact is substantial and possibly the strongest argument as to why market forces are malignant here. Each farm takes account of its own soil types, landscape features, rainfall and aspect. Only the soil type can be modified through the addition of organic matter etc – everything else is left to Mother Nature. Not all farms can grow grass well. Not all farms can grow maize well. Not all farms can grow wheat well. However, market forces have led to the specialisation of farms in many regards. One type of livestock only, only arable, only dairy. Most farms have been pushed into a situation where they have no choice but to be overly exposed to market forces. They can’t now switch to another system altogether – the infrastructure costs are phenomenal, and where is the certainty that the grass will be greener on the other side? What other enterprises offers any more stability than the current one? What other enterprises could work on the individual farm and fields in question?
The question is one of sustainability. If you want to move back to a situation where farmers dont have to have all their eggs in one basket, can diversify their cropping for the benefit of the environment and society, can invest in their businesses to make them as efficient as possible…. Well, I think it can only be done with some form of market intervention.
From our point of view, we a small mixed dairy and arable farm in norfolk. We are an historical anomaly – a product of a curious generational twist that left an abundance of family members able to excell at their chosen, and mutually beneficial, careers. We are doing ok, but we have a vested interest in all the other dairy farms in Norfolk doing ok too. If they don’t, there will be no vets, no dairy supplies, no dairy-cross beef farmers, no milk tanker to collect our milk, and no future for us. We are all in this together.
Emily – welcome, and I’m very grateful to you for that knowledgeable and personal account. Many thanks. Please come back and comment again now and again if you can.
Before we joined the EEC and had to accept CAP, Britain had a simple way of supporting farmers. In times of scarcity the price of the basic food was allowed to rise with the market. But in times of plenty there was a floor below which a subsidy kicked in to give the farmer a minimum basic price, which was indeed pretty basic. This kept farmers afloat, while encouraging more production only when a foodstuff was in short supply – unlike the old CAP which kept buying at a relatively high price to produce milk lakes and so on.
I’m surprised no-one is suggesting moving back to such a scheme – but not being a farmer myself I don’t really know if it worked as it should have. Any readers old enough to remember this?
Oh, and I must mention that our village shop sometimes has real bottles of Gold Top at £1 a pint, which are snapped up by us locals as soon as they hit the shelf. Message to dairy farmers: more Gold Top please (but don’t tell my heart specialist…).
Coop only just saved their bacon in the nick of time last week by upping the price 2.5 p. Could someone please confirm or otherwise . Do we import a lot of cheap milk into the UK from France?. I know you have to look hard to find a pack of butter that actually says it is made from British Milk. Labeling has always been a problem. Alot of pork is brought into the UK and processed here so therefore called British and labelled as such.
I really interesting blog to read and I agree with the vast amount that has been said, especially from Emily who made her case brilliantly.
The one point that hasn’t been mentioned is that regardless of people’s views on farming no one can support what is basically a supply chain and market model in liquid milk which is malignant. Supermarkets have a very complex marketing strategy which discounts certain basic products such as milk and bread and relies on selling added value products (own brands) at large mark-ups. A simple trip round any chain clearly shows how store layout and clever marketing has led to vast profits from companies who claim to be saving you money every day. The reality is very different. Because of the relatively simple supply chain involved in liquid milk it has become very easy for the multiples to pass some of the cost of their loss leading strategies down the supply chain without much opposition. They do this regularly with fresh produce and have a well-documented history of exploiting suppliers. Other basic food stuffs such as wheat are less affected since the supply chain is more complex but we have seen the milling industry under severe pressure earlier this year with the closure of one on the main millers due to these tactics.
Emily makes a very good point in that we are all in this together from arable farmers like me down to NGO’s as such a distorted market can only accelerate the massive changes that we have seen in UK farming over the last two decades. It is probably too late but at least the dairy farmers are the best example of family owned farming businesses we have and for that reason they deserve our full support under these circumstances.
Julian
Julian – thank you.
An interesting article Mark, I’m a dairy farmer but I do believe it’s right to ask tricky questions rather than shy away from them. It’s particularly interesting to compare, as you do, our dairy farms with other businesses. There are many points I would find it difficult to argue.
Reading the comments is also enlightening and flags up a vast array of issues surrounding a varied sector within the confusing and sometimes contradictory world that is modern farming. There are a lot of points being thrown into the mix, which can make it easy to forget where the discussion began.
I think many farmers would agree that the dairy industry has to be sustainable, that markets rule and that prices cannot be set artificially high. I think the point that dairy farmers are trying to make is that the industry must be allowed to be sustainable, corporations must be responsible and their actions moral, and trade must be ethical. Dairy farming doesn’t need to be singled out for special treatment it just needs fair treatment.
Without wanting to waffle on for too long, I’d also just like to highlight the role of dairy farming in supporting the mixed farming system that dominates vast swathes of the UK’s less favourable farmland- a system that allows me to have healthy, happy dairy cows and Tree Sparrows. It’s not all about green concrete and mega dairies.
Farmland birds – many thanks.
Some very interesting opinions and I particularly enjoyed reading Emily’s excellent comments, particularly the comment about the need to support mixed farming.
I’m not sure how mixed farming could be supported by market intervention, but I’ve always thought that the Single Payment Scheme (SPS) should do more to incentivise mixed farming possibly through the introduction of a ‘a mixed farming premium’ for smaller farms.
It does strike me that currently the SPS disincentivises mixed farming. Anybody with a reasonable knowledge of the Cross Compliance rules will appreciate that the burden of Cross Compliance record keeping lies with mixed farms, generally speaking for specialist arable farms the Cross Compliance rules are a doddle. For instance in the last few years 62 – 70% of reported Cross Compliance failures were cattle related. I also know from experience that some specialist arable producers have been detered from keeping cattle in order to manage grassland habitats on their farms due to the perceived liability to their combined SPS/ES payments. This burden of paperwork is not so much of a problem for larger farm businesses, they can afford to pay a farm secretary to sort it out for them or extra staff to allow them to sort it out themselves, however for smaller family farms which have incredible pressures on available time it really is not so easy.
A ‘mixed farming premium’ could help to ease this burden. The more diverse the farming system, the higher the mixed farming premium payment would be. I feel that this type of mixed farming incentive would also help to deliver many of the aims and objectives of Environmental Stewardship and could actually prove more effective than ELS in some parts of the country.
Joe – interesting points. Thank you.