NFUurges rejection of fudged BS proposals

6 August 1999

Tractor sales grow

TRACTOR registrations rose again in July, the fifth month in succession.

Sales of tractors above 40hp increased by more than 56% compared with the same month last year. After seven months 6576 units have been sold, almost 20% up on 1998, according to AEA economist Chris Evans.

"Its good news, but we should not get too excited. Remember, last year was the worst year ever for UK tractor sales. By the end of December I expect the market to finish up nearer to 10% higher than last year, rather than the 20% were seeing at present," he said.

The final figure will depend on how much of the tractor business has been brought forward. "Its all to do with the re-adjustment of the farming process as producers look to sharing and syndication to reduce the unit costs of production," said Mr Evans.

Meanwhile, AEA figures suggest combine sales for this year are unlikely to reach 700. That compares with 1133 in 1998; a 40% fall. Other machinery sales are running at similar levels to last year, said Mr Evans. &#42

NFUurges rejection of fudged BS proposals

GROWERS should reject British Sugars latest proposals to renegotiate the sugar beet contract, even though they contain some concessions demanded by farmers, says the NFU.

The union now seems to favour arbitration to bring four years of negotiations to an end.

BS is offering a fudged settlement with limited improvements which mostly repackages and redistributes existing payments, says Matt Twidale, NFU sugar beet committee chairman.

He is infuriated by BSs decision to write to sugar beet growers to spell out its latest proposals for the contract – the so-called inter-professional agreement – after the NFU rejected them three weeks ago.

But BS defends its decision. "The NFU sugar beet committee has indicated they are going to arbitration," says Clive Francis, deputy managing director. "Growers need to know what is on offer."

The NFU has retaliated, mailing growers this week to urge them to stand firm.

Although BS has moved on two main sticking points, crown tare payments and transport arrangements, Mr Twidale says the proposals do not go far enough.

"They are offering £10/t of crown tare above 4%. That is worth about £3m to growers, and will be phased in over five years. Thats about one-tenth of what we believe it is worth."

Another major obstacle is the outgoers scheme, described as a major concession by BS. Under it, a grower will be paid for relinquished contract tonnage and other growers can bid for it.

However, says Mr Twidale, some tonnage will have to be given back to BS. And growers wanting additional tonnage will have to meet contract at least four years out of five, a target which those wishing to retain existing tonnage will also have to meet, he adds.

Many other points need to be reformed and modernised, says Mr Twidale. "We are now at an impasse. We can either accept a fudged settlement, or stand out for our principles and make our case in a Determination. We believe we have a good case and a good team to fight it."

That could be an expensive option, warns Mr Francis. "The main issues of principle which have prevented the NFU from being able to reach a negotiated settlement have been payment for crown material and beet transport. We have conceded on these two issues.

"I believe we have answered their claim. Negotiated deals are all about compromise, and we have made major concessions.

"It is all good stuff for a negotiated settlement. If we have to go to arbitration, then all bets are off." &#42

AN – AN – post AN – Imported Imported Imported Domestic

immediate harvest small load urea N (Dec 0.26.26 0.24.24

delivery delivery (Nov pay) delivery)

89 92-95 92 85 prilled 73 120 117-118

Forthcoming markets (post harvest, £/t delivered*)

N/S (High S) N/S (Low S) TSP(47%P2O5) Muriate of Potash PK. 0.24.24


92 92 130 117 120

* Anticipated general prices. All values are based upon 20t loads for immediate

payment. Smaller loads and those with credit terms will vary considerably.

By Bridgewater Associates

NITROGEN prices are not far removed from those two decades ago, forcing UK manufacturers to maintain a price structure as best they can to ensure survival. Consequently, in accordance with the pricing structure terms previously communicated to merchants (Market Update, July 9), the delivery price for ammonium nitrate has been raised by £2 to £89/t.

There is, however, plenty of AN in Europe and farmers have made it clear that they wont really be tempted to buy until they actually need their nitrogen, even at a potentially higher spring price in the low £90s/t. So business is quiet.

However, imported AN in the east is reputedly now offered at £72-73/t on farm for December delivery and significant trade is being done in granular urea at £93-95/t, placing pressure on domestic prices.

Larger farmers are "bidding" for domestic AN at prices below the £87-89 figure. To what extent merchants are prepared to go out on a limb to pick up these bids, unsupported by the manufacturer, remains unclear.

The autumn PK market remains quiet with merchants anticipating customers taking a significant PK "holiday". But a cargo of imported 0.26.26 is being offered on farm around £120/t bagged delivered. This compares with a domestic blended 0.24.24 price of about £117-118/t.

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