February 2011 Archives

Duties on certain cereals imported into the EU have been suspended in a bid to ease rising feed grain prices.

The suspension relates to existing tariff rate quotas for low and medium quality wheat and barley, worth €12/t and €16/t respectively (£10-13). These tariffs will be reduced to zero until at least the end of June 2011.

“I hope this proposal will reduce tensions on the European cereals market,” EU agriculture commissioner Dacian Ciolos said. “While prices remain high on world and EU markets we have an obligation to do what we can to help ease the situation until the end of the marketing year.”

Organic farmers in East Anglia have access to new central grain storage after Yaregrain achieved organic certification for its store at Cantley in Norfolk.

The site will be able to take organic wheat, barley, beans and oats from this harvest and will apparently be able to cope with grain in “any condition” to allow farmers to get crops in before quality is lost.

Norfolk grower Nigel Carey has invested in the farmer-controlled business and said generally similar standards were expected for organic and conventional grain, however there were strict standards to ensure separate storage and records were kept to.

The total number of cattle in Britain is continuing to decline, but there are signs of encouragement, according to latest BCMS data.

It put the GB cattle population at 8.65m head on 1 January 2011, down 1% on last year. This was largely due to a fall in beef cattle numbers to 5.3m, while dairy cattle numbers improved slightly to 3.4m.

There was also evidence of stabilisation of the beef suckler herd, as more beef females were retained for breeding.

However, high feed costs look to have slowed the trend towards finishing dairy-bred males - the number of male dairy cattle under six months-old was 16% lower than last year.

It seems the number of new sites suitable for large-scale wind farms in Scotland could be diminishing, forcing up rents in response.

At least that’s the message from Scottish land agent CKD Galbraith, which says that between 2002 and 2008, rents under new leases increased on average by 200%. In addition, there was a 10% rise from 2009 to 2010 and the firm suggested strong demand for suitable sites meant the rising trend would continue this year.

“Landlords of pioneering wind farm sites throughout Scotland will soon be undertaking rent reviews on the earliest leases and evidence suggests that landowners can expect significantly higher rental returns for their projects from review dates.”

Scotland apparently has 110 operational wind farms, the largest proportion of which are in Aberdeenshire and Highlands & Islands. “With arguably the ‘best’ sites already developed, a trend is emerging to suggest that the average size and number of turbines per new site is decreasing,” the firm said.

Buoyant wheat and oilseed markets have pulled pea and bean prices even higher over recent weeks.

The British Edible Pulse Association said the feed beans premium over wheat had increased to £40/t, due to strong demand and stocks down about one third (200,000t) on normal. Human consumption beans were fetching a further £20/t premium.

BEPA reported a lack of export quality old crop marrowfat peas left to sell, although contracts for 2011 harvest were in place at £250-275/t. Good blue peas were fetching around £250/t and there was likely to be strong demand for these from the micronising market this year, and potentially limited supply.

“The main message to persuade UK growers to plant spring beans and peas this year is rotational benefits - but, in addition, market forces mean that pulse prices can only continue to be firm over the next year.”

As part of its strategy for growth, 2 Sisters Food Group is spending £30m to create a state-of-the-art food processing facility on an industrial estate in Thetford, Norfolk.

The site, which will open this spring, will initially focus on breaded chicken and will act as the “platform for growth” for the Prepared Foods Division.

“This will enable us to offer customers an exciting new range of healthy and nutritious coated food products, alongside our existing bestselling lines,” said 2 Sisters UK managing director Eddie Power.

The Ensus bioethanol plant on Teesside is to temporarily shut down at the end of April as operators resolve ongoing odour problems.

There have been a number of complaints about the brewery-type smell coming from the site since ethanol production began last spring and recent heightening of chimney stacks failed to solve the problem.

Ensus is spending £8m on two thermal oxidisers that will remove the odour from the animal feed drying section of the plant. Both units are on site and will be assembled and tested before the plant is shutdown at the end of April and the units connected.

The Environment Agency has an enforcement notice in place requiring completion no later than the end of May.

More than 500 farmers have signed up to supply wheat into the new Vivergo bioethanol plant near Hull.

The supply contract, called Humber Gold, was launched by Frontier Agriculture last November and features a range of payment terms. Frontier is the exclusive supplier of grain to the site, which will require 1.1m tonnes of wheat annually when it becomes operational later this year.

Humber Gold club manager, Mike Ayers, expected 1000 members to have signed up by the time the plant comes on stream and was confident the firm could supply the 130 lorry loads of grain required daily when production begins.

To be eligible to join the Humber Gold club growers must commit to supply Frontier with a minimum of 120 tonnes of wheat. For more information call 01482 420311 or email humbergold@frontierag.co.uk

EBLEX is hoping to reach a wider audience for its What If? costings tools by making them available through the Government’s Business Link website.

Producers can enter physical and financial details for their own flocks or herds and see quickly and relatively easily the financial impact of changing input prices and output costs as well as performance factors such as lambing percentages, feed rates and sale weights. This helps to highlight opportunities for improvements and efficiencies.

The free online calculators are part of the Better Returns programme and are already available on the EBLEX website. They cover six enterprise types including lowland and LFA sheep flocks, extensive and intensive beef finishing herds as well as suckler herds.

Robert Wiseman Dairies has become the latest milk processor to increase its price for farmer suppliers.

From 1 March, it will raise the farmgate price by 1p/litre to 25.72p/litre.

A statement said the move was in line with the company’s commitment to address concerns among farmers over the rising cost of milk production.

“For dairy farmers not aligned to major retailers, the increase reasserts Wiseman’s premium position relative to standard litre prices offered by major competitors in the fresh milk processing sector,” the firm said.

Last week First Milk announced an increase in the price it pays members in its three main milk pools from 1 February. This followed increases by Milk Link and Tesco the previous week.

Asda is to pay its Pork Link producers an 8p/kg deadweight feed price supplement for the 3000 finished pigs a week they supply, in recognition of the problems caused by high feed prices and low market prices.

The National Pig Association now wants to see similar action from other buyers, said chairman Stewart Houston.

The last pig slump of 2007-08 saw the UK pig breeding herd contract by 7%. He also called on retailers to reduce their reliance on imports - a move that would leave scope for the price of home-produced pigmeat to rise.

Some abattoirs had recently been rolling pig orders on by a week or more because it was easier to do this than get out of import contracts, said Mr Houston. Apart from increasing feed costs, this also raises the risk of producer incomes being hit further by weight and grading penalties.

Canada’s wheat growers will be hoping that a forecast 9% increase in their crop area materialises this year. Most of the country’s wheat is spring sown and there is another five months to go until all is safely in.

Last year heavy rains for most of June resulted in the loss of millions of acres.

The forecast rise would put the Canadian wheat area at 9.29m ha (23m acres) which is still 780,000ha (1.92m acres) lower than in 2009. Canada’s barley and oilseed rape crops are set to rise by 7% and 10% respectively, while oats will be up 21%.

“While there is still a considerable amount of time to go until planting, some fields were water logged before the start of the winter and there is currently a large depth of snow cover across the main growing regions.  The Canadian Wheat Board has reported that the snowmelt conditions will be important with warm, dry weather needed throughout March / April to avoid planting disruptions,” reports HGCA.

Average milk production cost in March 2011 will reach 30p/litre-plus says the Dairy Group, which is forecasting a more gradual and sustained price increase this time than in 2007.

At that time, higher milk prices triggered production increases and prices collapsed again. The price rise so far this year of around 1p/litre has not made up for production cost increases but markets are set firm for the early part of the year, says the group.

Its Milk Price Equivalent, calculated from weighted actual wholesale prices for liquid milk, cheese, butter and powders after processing costs, reflects likely market returns to producers. This now stands at 27.62p/litre and recent auctions in Northern Ireland saw processors paying more than 29p/litre for one month milk supply contracts.

The next price rises need to come quickly for many producers who are weighing up whether they can stay in milk long enough to reap the benefit of any longer term price improvements on the back of higher world demand for food.