Continental pig figures raise import glut fears

7 May 1999

Weather boosts new potato crop

Weather boosts new potato crop

NEW potato lifting is gathering pace in Cornwall, as better weather leads to improved samples which supermarkets are willing to stock.

More volume is being shifted earlier, says John Harris, British Potato Council field manager. "Crops are improving. It has been very wet, and samples have not been very attractive. Lifting now seems to be going a lot better."

In the week which sees the start of the British Potato Councils early potato promotion, samples had brightened and could now compete with good-looking Majorcan and Spanish imports, he says.

The earlier crop is also competing with Jersey Royals; lifting has been delayed due to poor weather. "These have not been looking quite as good – and people do buy with their eyes," says Mr Harris. "We think we can give them a run for their money."

About 40t of Cornish earlies a day were lifted over the holiday weekend, and the crop was worth 25-30p/lb (£550-660/t). Volume will gradually build, due to delayed plantings. While this could mean some Cornish growers miss the best prices, frost damage in other parts of the country, notably Kent, could keep supplies steady, says Mr Harris.

"The good news is that the multiples have indicated they are going to take the crop earlier. Tesco are already doing so, and Sainsbury and Asda have said they will start soon. There was some concern that we might not meet demand, but we should be able to do so now."

Pembrokeshire will be the next area to start, though it will be mid-May before appreciable volumes are lifted, says field manager Gavin Robinson.

&#8226 National Chip Week, which ran from Feb 15-19, produced a record equivalent advertising value of over £1.1m, says the BPC. Coverage was achieved on several leading TV and radio shows, and many daily newspapers. The promotion was also pushed by backers Tesco, Asda and Sainsbury. It is too early to assess if consumption rose. &#42


uA SERIES of financial management workshops aimed at small businesses, including farms, has been launched by the UK 200 Group of accountants. Topics include profit margins, managing cashflow and credit control. Each workshop includes a three-hour intensive session including case studies, workshops and action plan construction. Cost is £70 inc VAT. Dates and venues to be announced. Details 01252-333511.

uMILK producers wishing to apply for temporary conversion of their 1998/99 quota allocation from direct sales to wholesale, or vice-versa, have until May 14 to submit forms to the Intervention Board. Late applications will be rejected. If there is no application to convert, unused holdings of direct or wholesale quota will be reallocated to offset overproduction by other producers. &#42

SAC:No future for oilseed in Scotland

SPRING oilseed rape has no future in Scotland, according to a report just published by the Scottish Agricultural College.

The study, for non-LFA areas, forecasts a net profit of £22/ha (£8.90/acre) in 2000 followed by losses of £24 and £68/ha (£9.70 and £27.50/acre) in the two years after that.

The gloomy outlook follows a net loss of £52/ha (£21/acre) last year.

"The graduated switch to a flat rate of area payment between harvest year 2000 and harvest 2002 confirms earlier fears that the enterprise is likely to become less profitable. As a result, it will be much harder to justify the growing of spring oilseed rape in future – its yield simply is not high enough," says the report.

Winter oilseed rape fares a little better. It is expected to stay around last years level of £195/ha (£79/acre) until 2000 before falling to £146 and £103/ha (£59 and £42/acre) in the following two years.

For cereals, the forecast is for Agenda 2000 reforms to lead to a drop in net margins in 2000 followed by a recovery to 1997 levels the following year. Spring barley, the most popular cereal crop in Scotland, appears most vulnerable with net margins hovering around £100/ha (£40/acre).

Cutting fixed costs seems to be the best way to turn the figures around. For all cereal crops, fixed costs were higher than variable ones and, in the case of spring barley, swallowed up more than 50% of total output.

The college reports were compiled by John Anderson and funded by the Scottish Office. &#42

Continental pig figures raise import glut fears

FEARS of a glut of cheap imports undermining UK pig prices were raised this week after industry figures suggested a steep climb in sow numbers on the Continent.

But the figures, reported by Signet, are not quite what they seem, says the Meat & Livestock Commission – they were recorded using data from last December.

"There will be a reduction (in sow numbers) on the Continent towards the end of the year, but not the drop seen in this country," says MLCs Mick Sloyan.

Domestic markets could still be affected, as they command a premium of up to 28p/kg over some EU supplies; a gap that may increase if sterling strengthens. "While UK prices have stalled in the mid 80s we still hope they will reach 90p/kg by mid 1999. But its a case of wait and see."

Slightly higher prices recorded recently on the Continent could help, he adds (see graph). "But there is still a substantial margin between UK prices and the rest of the EU; if this persists it will put a lot of pressure on the market."

Max Hilliard, managing director of Malton Foods, the UKs biggest pig processor, says the company will continue to source home produced pigs as long as supplies are readily available. But prices will have to remain competitive.

His comments follow this weeks renewed warning on trading conditions by parent company Unigate. Pressure on pig margins is partly to blame – the Malton business accounts for about 20% of group profit.

"If there is no profit in slaughtering a British pig compared with an imported alternative, it is inevitable that imports will get sucked into the vacuum created. So the price returned to UK producers is held down by the price people can import at. We are certainly not turning pigs away," he says.

However, home supplies are dwindling since tighter legislation has forced British pig producers out of business ahead of European competitors, he adds. If Malton throughput follows suit, then the factory will have to look elsewhere. "As numbers tighten, imports are inevitably going to grow," says Mr Hilliard. &#42

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