Dedicated supply arrangements with retailers can be a great way of adding value to end products and boosting farm incomes. Cedric Porter visits a farming family that has seen real benefits from supply chain co-operation.

Andrew Farrant milks 440 dairy cows at Manor Farm, Eaton, near Oxford. For the past seven years, he has been part of the Waitrose Select Farm group of dairy producers who supply the supermarket with all its fresh milk and cream. Their cattle are also used in Waitrose‘s British Beef range.

“The system does bring extra responsibilities with it, but fulfilling those extra responsibilities is well rewarded,” says Mr Farrant, who farms in partnership with his father David, his uncle Jim and Cousin Ian.

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Until four years ago the family had two dairy farms close to each other in Oxfordshire, but it was decided to amalgamate the dairy operation into one unit. Then the Farrants bought a farm in Herefordshire, which is run by Jim and Ian.

Initially, they both reared the youngstock replacements and finished the surplus calves as beef. “But TB started to become an issue in Herefordshire, so now we breed the replacements here,” says Andrew.

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Last year, nearly 300 Friesian bull and Belgian Blue calves made the journey from Oxfordshire to Herefordshire. “We wean the calves here and then, at between seven and 12 weeks, they are sent up to Herefordshire,” says Andrew.

The closed nature of the system means the stock are fit and healthy, although national disease issues have to be factored in. “Until recently we were in a bluetongue protection zone and the Herefordshire farm was in a surveillance zone. It meant we had to keep them a little longer than we would normally do.” The extension of the protection zone means that bluetongue-vaccinated stock can move freely between the farms.

At the 220ha (540-acre) Underley Farm near Tenbury Wells, Jim and Ian Farrant run the black-and-white and Belgian Blue-cross calves together. “Adopting the same finishing system for all the calves is the most efficient way of doing things,” says Jim.

“We use as much home-grown grass and maize forage as possible.”

The Farrants’ stock is finished at between 20 and 22 months, although recently a batch of Friesian steers was finished by 17 months. The fact that David and Andrew Farrant use New Zealand dairy bulls means the resulting bull calves have better beef confirmation than pure Holstein lines, says Jim.

About 60% of the beef stock are black-and-whites as Andrew and David seek to increase dairy cow numbers, but it is expected that eventually more than half of the calves will be Belgian Blue crosses.

The farm works closely with the farmer-run Meadow Quality marketing group. It ensures that stock are ready for dispatch to Dovecote Park, the abattoir and processing plant near Pontefract in Yorkshire, which supplies Waitrose with its beef.

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Waitrose producers rear to a protocol that sets out the quality stock have to be finished to, a system on which payments are based on. Most of the Farrants’ stock achieves the R grade.

Something that Mr Farrant appreciates about the relationship with Dovecote Park and Waitrose is the amount of feedback he gets on the quality of stock and how it can be improved. “I’ve sold stock elsewhere in the past and had no feedback once they have left the farm. With Waitrose you get a feeling that they are really involved and want to improve stock for the mutual benefit of them and us.”

Although quality is crucial for Waitrose, so is consistency of supply. Dovecote’s procurement team requires cattle 52 weeks a year and works closely with producers to determine which stock will be available at any given time.

The Farrant family all understand that producing either milk or meat for Waitrose brings with it responsibilities. The retailer insists on higher animal welfare and environmental standards than average, but for the Farrants, many of these demands are already being met. “For example, both of our farms are already in Higher Level Schemes,” says Jim.

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But it is the reward for the extra effort and the loyalty offered by Waitrose that impresses Jim Farrant. “When the market was poor we were paid a higher price,” he says. “This loyalty means we are very willing to work with Waitrose to deliver the quality beef its customers demand.”

Building loyalty

Fostering this kind of loyalty is a key aim of Waitrose, says its agricultural manager Duncan Sinclair.

Although the first Waitrose beef producer groups were established about 20 years ago, Mr Sinclair believes they are more important than ever. “We are looking to develop these relationships because we see the pressure on the supply of quality cattle increasing,” he says. “CAP reform is really starting to bite and there are signs of a decline in the suckler herd.”

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Mr Sinclair says Waitrose is committed to sourcing 100% of its beef from Britain, but acknowledges that it needs to work closely with producers to fulfil that promise.

In an admirable piece of forethought, the retailer recognises that a decline in the specialist UK beef herd will mean a greater reliance on dairy calves for supplies in the next five to 10 years. To this end, it recently held a dairy genetics seminar to look at the type of cattle producers will need to be breeding to meet the demands of the beef market.

Mr Sinclair says that by feeding back this sort of information, as well as matching up dairy producers with beef finishers, its beef suppliers can deliver what the supermarket wants and profitably.

The Waitrose supply chain seems to work well because it provides reward for extra effort throughout the chain, allowing it to become stronger. As Jim Farrant puts it: “Our relationship with Waitrose is valuable, both in terms of a higher price and long-term loyalty.”