Despair as mixed enterprises all fail

6 March 1998

Despair as mixed enterprises all fail

Scottish farming is facing its worst crisis in 60 years. Every sector has been hit by falling

prices and rising costs. Subsidies account for an uncomfortable proportion of net farm

income and bank borrowings are rising. In the fourth of our special features focusing on

farming throughout the UK, Allan Wright assesses the health of Scotlands agriculture

DAVID Jack would prefer to forget last year. Difficult trading conditions severely eroded the capital value of his mixed farm business located at Jackstown, Aberdeenshire.

The main enterprises are dairying, cereals and seed potato production. "If all three enterprises are profitable, we reinvest and the business can grow. If two out of three are profitable, we make a profit but without an acceptable return on capital and theres no money for reinvestment.

"If only one enterprise is profitable our business makes a substantial loss. But if all three are in the red, as they are now, it will take at least three years of moderate profits to balance the books," says Mr Jack.

The governments 1997 net farm income figures conceal the full extent of capital erosion, he claims. Either the government doesnt understand the scale of the problem or refuses to resolve it.

"Im bored hearing from ministers how the industry should look in 10 to 15 years time. I want to know how we get from here to where we want to be; an efficient part of the food industry with an equitable share of its substantial profits," says Mr Jack.

Former chairman of the Scottish NFU cereals committee, he disagrees with the unions enthusiasm for a single European currency. "The simplistic view that without currency exchange fluctuations, the CAP would be fine has as much persuasion as the popular view that joining the euro is all about not having to change £s into pesetas on the way to Tenerife."

Mr Jack is proud of the Scottish Quality Cereals farm assurance scheme he chairs. It covers 50% of cereal production in Scotland and has been the model for Assured Combinable Crops in England. But he questions why so many farmers have difficulty accepting that they are part of the food industry and have to conform to its standards.

He is also deputy chairman of the Home-Grown Cereals Authority research and development committee. "Sustainable farming must have access to innovative science and embrace all available new technology," he comments. "Any industry has an obligation to invest in its own research and, through a small levy on cereals and oilseeds, we do it rather well."

Although confident that Scottish farming has a future, Mr Jack predicts challenging times ahead. "It is vital that agriculture is sustainable and complementary to the environment, the countryside and the rural community. Agricultures role is to produce wholesome food at a fair price for farmers and consumers," he says.

David Jack:Either government doesnt understand the scale of the problem facing farming or refuses to resolve it.

See more