Government must help combat volatility, says NFU leader

NFU president Meurig Raymond has called on the government to help producers address volatility in agricultural markets. 

“In the last 10 years, British farmers have become much more exposed to world markets,” Mr Raymond told the NFU annual conference in Birmingham. 

See also: Farmer confidence hit by volatility concerns, poll shows

“This is the consequence of decisions taken at international, European and national level,” he told delegates in his keynote speech on Tuesday (24 March). 

The British population was growing faster than any other large European country – and set to reach 70m people in 20 years time, said Mr Raymond. 

But at the same time, UK self-sufficiency in food production was falling. 

Self-sufficiency has dropped from 74% in 1991 to 60% today, according to an NFU report published to coincide with the conference. 

The document forecasts that self-sufficiency will fall to just 53% unless the downward trend is reversed, claims the union. 

“The British consumer wants – indeed expects – to be able to source British food,” said Mr Raymond. 

“Is that what is best for Britain? The answer is clearly No. I believe we, governments, farmers, the food chain, have a duty to address that problem.” 

Although global production and consumption were roughly in balance, any small chain one way or the other had big consequences, Mr Raymond said. 

These consequences included price spikes in 2007 and 2011 – as well as low prices now being experienced in sectors such as milk. 

“The mechanisms we used to see to ensure stability have been dismantled,” said Mr Raymond. 

Milk quotas were due to end this year. Sugar quotas would end in 2017. 

“Tariffs have come down and there are an unprecedented number of trade deals on the table that will expose European producers to further competition. 

“Export refunds are no longer used. Intervention, where it exists, is at minimal level. So we need to find other ways to manage price volatility. 

“Everyone knows that a boom and bust rollercoaster ride is the worst environment for the long-term planning and investment will be essential if we are to grow our sector and meet our consumer expectations.” 

Politicians should ensure the food chain worked fairly, said Mr Raymond. Farmers also needed unhindered access to futures markets. 

At the same time, UK dairy farmers needed longer periods for tax averaging, like their Irish counterparts who could average their tax over five years.