Doubt cast over recovery plan

20 July 2001

Doubt cast over recovery plan

CLAIMS by politicians that co-operation and adding value to products are the answer to farmings problems have been challenged by an agricultural economist.

Mike Haines, who recently retired as director of the Welsh Institute of Rural Studies, Aberystwyth, said he is a strong supporter of agricultural co-operation.

"But history shows that farmers like making their own decisions and few are prepared to be committed enough to make co-ops work," said Prof Haines.

"There have been notable successes like South Caernarfon Creameries, but many British co-operative initiatives have failed because members have not shown loyalty and management has been poor."

He is wary of people who encourage farmers to invest in the downstream marketing of meat and is sceptical about calls for producers to move into processing.

"There is considerable over-capacity in the meat business, which operates on very tight margins and requires very considerable expertise. Farmers do not have the necessary skills and find it difficult to hire the right people. Encouraging farmers to invest in bricks and mortar to process livestock can be a recipe for disaster."

However, he backs the concept of farmers getting involved in joint ventures with processors to add value to their livestock, as long as the returns make it worthwhile.

Politicians claim that farmers can survive by working together and improving their marketing. But Prof Haines believes the foot-and-mouth epidemic means it is now too late to prevent as many as one-third of Welsh farmers quitting.

"The fall-out will be bigger than during past crises because farming was in such a poor economic state when the disease struck."

The steep fall in quota values means that people who are forced to retire will not have the financial cushion they expected.

But those who survive will do well, he said. Farmers who accept that food production is just one form of land use can be saved by agri-environment schemes and diversification.

"The EU will not go on paying farmers to produce surplus food. However, taxpayers may be persuaded to pay for more schemes that support the use of farmland for recreation and for urban people to enjoy fresh air, wildlife and wonderful views."

He also sees opportunities for innovative diversification for capable farmers. However, many have neither the money nor the knowledge to make a success of an alternative enterprise, he claimed.

While there is scope for direct selling of local food to local people, these initiatives will never occupy more than a small niche in the market. Those who survive in mainstream farming will have to market their products as skillfully as possible though the normal food chain, he said. &#42

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