November 2014: Who does more efficient production really benefit?

About the only word I can think of to describe arable farmers at the moment is “idiots”. Having had the worst prices for many years, we carry on and drill cereals, rape and beans for another year, without having the faintest idea what price we’re likely to receive after next harvest.

What other industry would do that? Would you go to work not knowing what you were going to be paid, when the return you might get might not cover your costs of going? It’s the same sort of thing if you think about it.

I receive text messages almost every day from some marketing lady who happily tells me wheat has dropped another pound per tonne, or she’ll gladly buy 1,000 tonnes of oats next harvest at £10/t under current wheat prices, or rape has increased another £1 after falling £5 and can be delivered to Liverpool or Hull docks at a price well under production costs.

But that’s the problem we face and have always faced when we buy everything at retail, sell everything at wholesale and have no say in either. Maybe that’s why we’ve seen an increase in those entrepreneurial farmers who now sell privately, go to farmers’ markets or have perhaps opened a farm shop.

I realise, of course, that not everyone can do that, so congratulations to those who do. It was interesting to see the number of entrants for that category in the National Pig Awards, so perhaps the number of producers using those techniques is greater then we think.

I have to say all entrants for all the awards categories took a lot of sorting out. I think I can safely say we didn’t have one bad entry, and the standards being achieved these days is almost mind blowing.

One question that’s often in my mind is just how far can we go in improving production efficiency, and if we do improve, will the buying fraternity take the extra margin we produce? It reminds me of the visit I made several years ago to a farming family in Lancashire that had 120 sows and 150 cows. I remember saying to them that I had a fair idea how he would be doing with his sows, but I was out of touch on what he would be achieving with his cows.

He told me that he and six others were in a small marketing group supplying milk to one of the large supermarkets through a third party, and that they were really struggling. Apparently they’d written to the retailer telling them they were struggling to make ends meet at the price they were being paid.

After six letters, the retailer got fed up and set up a small committee to go round the UK to see exactly what it cost to produce milk. The answer they got at the time was 27.1p/litre, and its response to the producers was that it would pay them 26.9p. Says it all really!

> Yorkshire farmer Sam Walton is a former pig producer and the founding editor of Pig World

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