Support system revamp will aid marketing focus
The year has been physically
fine, but financially flawed at
Tirinie. And Ian Duncan
Millar is equally concerned
about wider farming issues.
Allan Wright reports
THE agricultural support system is preventing the industry from taking account of market requirements, says Ian Duncan Millar. As leader of the farm assurance side of Quality Meat Scotland, he is frustrated that the development of market-led production and selling is thwarted by subsidy considerations.
"Beef provides the best example. We have a suckler cow premium scheme that will allow 40% of a breeding herd to be heifers. That means production of top quality beef will be at least 20% short of potential in a consistently under-supplied market.
"There is the slaughter premium, which will rise from £31/head to about £48 on Jan 1, and also the attraction of the second production premium at 20 months of age with its two-month retention period.
"The result of all this, within an EU policy of reducing beef production, is that farmers pay more attention to the column headed subsidy on their balance sheet than the column headed market return," says Mr Duncan Millar.
He points to the demand and premium for Specially Selected Scotch Beef, a demand that cannot be met. "We should be gearing support payments to breeding cows, not heifers, and production subsidies to the marketing of animals at the optimum time, instead of having them queue up for payments."
The beef enterprise at Tirinie is being expanded with the purchase of seven store bullocks and nine heifers to supplement the 27 bull and 31 heifer suckled calves bought, as usual, from his brother.
"Im tempted to say the beef enterprise is the one which has done least badly. The vagaries of the malting barley market have left me with plenty of feed grain so I will push the bulls a bit harder with more concentrates and take the heifer calves and bought-in stores through the winter more slowly on silage and some barley. Its about making fuller use of resources."
Two late calving heifers have been retained but the rest have all been sold with calves at foot at a flat rate of £800 or £50 above budget.
Putting the remaining Tirinie lambs onto a maintenance diet for six weeks when the deadweight price slumped below £1.50/kg has paid off. They were put on turnips on Nov 10 and are now ready for sale and worth about £2/kg. However, the sheep enterprise is under the microscope.
"The gross margin in the past financial year was £160/acre and that does not cover fixed costs. They will have one more year at current stocking levels, but if performance is no better they will be cut back and replaced with cattle."
There is little chance of any expansion on the cereals front. The Chalice barley all went for malting (final pool price unknown) but the rest is still at Tirinie, including 50 tonnes of Decanter grown for seed that may not meet specification.
"The grain is well below the budget of £85/t to give a gross margin of £200/acre. Having manipulated the market again this year, I see the maltsters are up to their usual trick of promising a firm demand next year."
On the hill farm he manages at Auchnafree, the 150 smallest lambs went to the light lamb cull at £10 each. "It wasnt a pleasing thing to do but these were the lambs that would normally have gone to the export market and the ones that would have cost most to take to 15kg for the home trade."
With no farming alternative to sheep, the aim is to make the most of the enterprise and, alongside the organic production, the move is to use Cheviot tups on an increasing proportion (up to 30% this time) of the Blackface ewe flock. "There is a clear premium for tight-skinned lambs and I am reacting to market signals."
On the family hill sheep farm at Wester Tullich, a performance-recorded flock of 200 (150 ewes and 50 gimmers) will be mated to eight recorded tups, most to those with top status for scrapie resistance.
The 450 unrecorded ewes comprise 150 bred pure using high scoring rams and 300 (including some cross gimmers) mated to a mix of Blackface and Texel rams.
On the year in general, Mr Duncan Millar sums up: "Physically a good year with good weather at the right times. If only prices had matched projections but, apart from beef, they have not. At the moment it looks like a break-even year and my family has had to rely on my off-farm income." *
A shake up of the agricultural support system is desperately needed, says Ian Duncan Millar. But, whatever happens, sheep production is likely to be wound down at Tirinie.
• Tirinie, a 129ha (318-acre) mixed arable and stock farm in north-west Perthshire, farmed by Ian Duncan Millar.
• The land is a mix of sandy loam over gravel near the rivers Tay and Lyon, and medium loam.
• Main arable crop is spring barley for malting and seed contracts. Turnips are grown for wintering sheep.
• Sheep flock of 300 Mule and Texel cross ewes. Lambs are finished and sold through a local lamb marketing group.
• Suckled calves bought privately from one farm. Males finished intensively, best heifer calves kept for breeding and sold with calves at foot.
• Farm staff of one.