David Neale Blog
May 24, 2012
Politicians Take Note
At a time of intense debate and speculation about the Greek, Spanish and all Euro related challenges – what will the outcome be? I suspect not good for many of us but no doubt some of the financial gamblers and fund managers will have got some gain from it all! In saying this I note the welcome arrival of the latest NFU campaign, I have made reference to some of the key points within the campaign below.
This sector contributed some £85 billion to the UK economy last year, while helping to keep some 3.5 million people in work. Key findings from the report include:
- £1.75 billion: The growth recorded by farming’s GVA in 2011
- Farming’s GVA totals £8.84 billion – or has seen an increase of 25 per cent last year
- Food and drink has become the UK’s fourth largest exporting sector.
Whilst this news story has not yet hit the headlines, things look set to change as the NFU launches its new campaign talking to the British public about what farming delivers for Britain. At the heart is a simple message, be proud to buy British food and remember the immensely powerful role that farming plays in securing the nation’s future.
I think we should all get behind this campaign and support the message about our great industry. Agriculture is profitable for farmers (in most places – although spare a thought for the Milk Producers), is a leading contributor to the exports industry and plays a positive role in employment. It is essential to the health and well being of the population, so let’s get out there and promote our industry.
I recently read the excellent report from Jim Paice about the mission to China where we have secured a £50 million pound contract. Sending pigs to China really is a big success given there are more pigs in China than the rest of the world combined. This year China will probably take 60% of the US Soya crop.
Weather & Market Volatility is the Constant
From Russia and the Ukraine where we started with severe winter kill we now see extreme heat and crop pressure. Closer to home the massive areas of wheat, barley and rape in Poland, Czech, Germany and France subject to February frost kill have now been re drilled with spring barley and Maize is now showing through in the Strategie Grains downward forecast of the European crop.
In the US there are variable reports despite excellent plantings of Maize and developing concerns over hard red wheat production, dry weather and winds are also playing a part in values. In South America they have weather and continued political problems. Wheat tumbled over in the last few weeks as sellers rightfully decided they had committed enough at earlier values. However in the last few days it has been recovering well and taking the stage from the constant Maize debate. Maize has strengthened with positive Chinese views about imports and production figures. Be cautious, seek out the best price and terms but do not be afraid to keep building that average for your business protection.
And back in the UK the Challenges Continue!
I think its best we try to put behind us the desperate wet weather that has delivered record rainfalls after the drought. Yes our bore hole is now running well on the farm with plenty of water pressure and much grass for the first cut of high quality hay. They still maintain ‘the wrong type of rain fell!’ and that a few dry weeks will show up the long term problems – we will see.
One thing is for sure; our agronomists have worked hard with growers to adjust and re plan disease and spray programmes coupled with growth regulator challenges on timings and availability. This is when long standing, trusted relationships based on expert knowledge really work. With high temperatures forecasted for this week, activity levels will pick up once again, keeping the pressure on.
Our extensive R&D programme and demonstration sites across the UK are helping us keep everyone abreast of rapidly falling resistance figures for yellow and brown rust and septoria. In addition this is the first time for a few years we will have been severe testing on lodging scores with longer internode length, more tillers and straw. The last thing we need to cope with is lodging and bushel weights in the market place we find ourselves in. One thing you can be sure of is that claims will be a focus for those who see the opportunity!
I would like to think that increased UK demand for quality, together with European and world factors, will mean that our millers will help support local provenance and help drive marketing at the supermarket level for increased support of British Wheat.
It is time to respond with appropriate and consistent premiums and variety commitments, enabling growers to plan and provide the right goods for the market. Last year has seen a very high and unusual pass rate around 70% plus, when 35-40% might be more usual. Single figure premiums, as currently exist, will just continue to drive down milling wheat acreage.
With increasing risk to quality from disease I would already be concerned as a miller. I would suggest a little more long term thinking and sustainable contracting that considers the growers risk and rewards for lower yielding and growth of more costly varieties. Please do not leave it too late and be reliant on fragile and volatile imports. People are thinking ahead so make sure you are not left behind.
And do not think I am forgetting Maltsters
You have challenges from high yielding feed options and again this year’s weather with increased tillering, disease and lodging pressure. We wait to see the extent of bushel weight, nitrogen and screenings challenges, more information on this next time.
Finally Cereals 2012 & the Agrii Seminar!
Dan Basse, one of the world’s top Analysts in Crops Markets and Political matters, will join Agrii at Cereals. Dan Bass is Vice President of AgResource in the US and is a mid-West farmer. Dan consults US and Chinese Governments and is often on CNN and NBC programmes. Dan will give his perspective on world food supply and demand during this seminar which will take place on both mornings in the Arable Conference Pavilion. You will need to secure a place for this event, if you would like to attend please email firstname.lastname@example.org to confirm your place.
Agrii will be present across the Cereals site as detailed below.
Main Agrii Stand: G826 we hope you will visit us on stand G826 during your visit to Cereals, come and enjoy some refreshment with us and get a better understanding of how Agrii can support your whole farm profit equation
SoilQuest Stand: D530 for the very best of soil services including mapping, analysis, variable seed rates and advice on all aspects of Precision Agronomy come and visit our SoilQuest team on stand D530
GB Seeds on the Just Oats Stand: J1017 Agrii’s Naked Oat and Seed specialists
There is always plenty to talk about and we look forward to welcoming you onto our stand at Cereals on the 13th and 14th June.
Through the busy summer months I look forward to seeing many of you during our summer events programme.
You can email David your comments and opinions via email@example.com.