Tax would kill competition

3 September 1999


Tax would kill competition

says Kent grower

A PESTICIDE tax would be a clear sign that the government has lost sight of the UKs balance of payments and no longer cares whether soft and top fruit is produced here or abroad, says Robert Pascall, a director of Kentish Garden Marketing and vice-chairman of the NFUs soft fruit committee.

"My main concern is that a pesticide tax would be anti-competitive," he says. "The government must decide whether it wants to retain a UK soft and top fruit industry."

KGMs 60 growers supplied UK supermarkets with about 4600t of fresh strawberries last year – about 42% of the home-produced market.

Nearly half Mr Pascalls 138ha (340 acre) Clock House Farm, Coxheath, Kent, is in orchards, but he also has 22ha (55 acres) of strawberries and 6ha (12 acres) of raspberries. His marketable strawberry output is about 300t.

"We are in direct competition with produce from Europe and the rest of the world, and to retain our profitability we must be competitive," says Mr Pascall. "The net result of a pesticide tax will be to increase our costs."

New labour regulations have increased his annual labour bill by one-fifth to £750,000. "Its our biggest single input."

"We use integrated crop management as a matter of course and our pesticide use is already kept to an absolute minimum. No-one wants to spend more than they need to."

KGM spends about £250,000 a year on research and development, some of which has led to a wide range of measures to minimise insecticide use, he says.

"We plant phacelia here and there and leave as much of the edges of our orchards untouched to encourage natural predators like hoverflies, and we find we no longer have to spray against pear sucker as a result.

"I estimate that despite increasing chemical costs in some cases, we have cut our pesticides spend by 20% in five years."

But until more resistant varieties prove themselves in the market, a robust fungicide programme to deal with botrytis and other strawberry diseases is essential, he says. "The stores preferred variety is Elsanta which is very susceptible to all diseases. KGM is putting a lot of money into researching better varieties, but they will take time to come through.

"At the moment most top and soft fruit growers are on the edge of profitability. It wouldnt take a lot to upset the balance."

The damage to the sector from a pesticide tax would have widespread local repercussions, adds Mr Pascall. "It would cause a huge loss in confidence among rural people in the value of training themselves for a career in horticulture and would de-skill the industry."

Environmental work will be at risk under tax

says Shropshire cereal producer

IF pesticides are causing concern, tighten the rules governing their use and police them more thoroughly, suggests Shropshire cereal grower Marcus Themans.

"If there is a problem fix it, dont tax it," says Mr Themans, chairman of the NFUs technical services committee, whose main enterprise at Edge Farm, Longville, Much Wenlock, is a 180-sow breeder/bacon pig unit.

With only 60ha (150 acres) of cereals, all continuous winter wheat, he admits the effect of a tax on his business would be less than for growers with bigger areas of more diverse crops. "But any tax would come straight off the bottom line. And if we have to face extra pesticide spending we shall be looking to save costs elsewhere."

Environmental programmes on the farm have already suffered because of low returns. "For the past two years we havent done any hedge laying, coppicing or tree planting. We used to spend about £2000/yr. That has completely stopped."

A pesticide tax would delay any chance of reviving the exercise, he says. "Our wildlife habitat management is unlikely to be progressed.

"An important point missing from the tax proposals is any recognition that pesticides are not simply used to increase yields. In many cases they are essential to save a crop, for example from slugs."

Mr Themans says the potential nine-fold hike in chlormequat price is "frightening". "Anyone in mixed farming areas and using a lot of livestock muck, like we do, has to rely on a fairly hefty growth regulator programme.

"All our wheat was down to Soissons this year and the quality premium is important to us. Without a regulator we wouldnt stand a chance of getting it.

"The presumption in all the arguments about pesticides is that their use harms the environment. But it is misuse, accidental or unintentional, that is the problem."

Much useful practical research, notably the recent Cherwell River exercise by ADAS, shows how minor tweaks can bring big improvements, he says. "In this case it showed how simple changes in working practice or conditions of approval can reduce the amount of pesticides getting into water."

But any tax is unlikely to find its way back to funding such work, Mr Themans believes. "What bothers us in the NFU is that the proposed tax is unhypothecated in any way." Even in Denmark, where some of the income has been ploughed back into environmental research, the tax has been remarkably unsuccessful in lowering overall use, he adds.

Alternatives topesticides not yet fully proven

warns lettuce producer

INTRODUCING a tax on pesticides before other ways of keeping crops squeaky-clean are fully proven would leave the door wide open for cheaper imported produce and risks losing jobs, says Lincs lettuce producer David Piccaver.

Pesticide use has already been heavily cut recently at J E Piccaver & Co, the 1000ha (2500 acre) mainly salad and bulb producing family business he runs at Holbeach.

The firm supplies processors with about 18m ready-to-eat lettuces for sandwich-making, which must be pest and disease-free. Any insects discovered inevitably mean that whole consignments are rejected. So, despite the adoption of integrated pest management, some insecticide use is inevitable, Mr Piccaver says.

Other crops on his silt land on the edge of the Wash include potatoes, vining peas and cereals.

"We have reduced our chemical inputs by 15-20% in two years, mainly by cutting the number of spray applications we make. We no longer use insurance programmes."

Paper mulches and netting to protect salad crops from pests have been tested for three years and appear promising. "So far they are more expensive than using pesticides. But that could change with a healthy reduction in prices which should come once suppliers perceive a bigger market. The idea isnt dead yet.

"The main problem is that we still have to learn how to manage these new methods. For instance we have found that we get a temperature rise under the nets which can affect harvesting schedules and cause other problems like bolting. So the alternatives to pesticides are not always as straightforward as they may seem.

"On top of that, with higher costs under a pesticide tax, we would have less money and management time to spend on developing them."

Mr Piccaver fears for the future of his 30-35 full-time and 70-80 casual staff once the way is eased for foreign competitors. "The Spanish and the Dutch dont face the restrictions we do.

"If the aim of the tax is to allay consumer health fears, it may have the opposite effect if it encourages imports from countries where chemicals are still heavily used.

"I am not saying that they are breaking any laws. It is simply that the authorities over there seem to have a more relaxed attitude."

Passing on the tax is unrealistic, he believes. "Every time we have to approach our customers to explain how things like the National Minimum Wage, the Working Time Directive and new transport rules are increasing our costs, the more strained the relationship becomes."

Attempts to recoup a pesticide tax would drive them further to look for supplies abroad, he believes.

"In all of this tax debate we must keep reminding consumers that we are producing safe food," he adds. "The implication is that we arent."

Tax would mean job losses

says Lincs veg producer

PESTICIDES are key inputs at Old Leake, Lincs, and taxing them would slash income already hit by new working hours laws, says John Allen who runs the family business &#42 A Allen & Son.

As a member of Old Leake Growers Association he produces about 80ha (200 acres) of vegetables each year, including potatoes, brassicas, pumpkins and marrows for multiple retailers. About 64ha (160 acres) of silt land is double cropped and his annual pesticide bill is about £15,000.

OLGA is a grower-marketing co-op also providing casual labour for harvest.

"Pesticides are critical to maintaining our customers and business," says Mr Allen, who employs two full-time and one part-time worker. "Supermarkets are so strict on appearance and pest tolerance that if they find just one fly or beetle it comes back to us and we are surcharged. The only way we can achieve these nil tolerances and still remain competitive and profitable is by using a certain amount of pesticides.

"We already stick to Assured Produce protocols which means we only use them where necessary. And at the prices they are its madness to use more than we need."

A pesticide tax would make little difference to the way he operates. "We have no option but to continue as we are and the business would have to bear the cost. But its a cost that will force marginal producers out of business. The knock-on effect of that loss of UK production has huge implications for employment in rural areas.

"There are a lot of villages with small fields around here. We are not prairie farming. People can still start in a small way. A pesticide tax wouldnt allow them the chance."

Mr Allen is sure his output is as cheaply produced as that of overseas competitors at specific times of year. "But I am very annoyed that Spanish and other Continental growers can use chemicals which we are not allowed on imports that come here."

Such produce often undercuts home-produced goods aimed at the premium-earning times of year, he says. "We are losing out on the cream and getting only the skimmed milk."

Increasing production costs to meet new health and safety rules and recent rises in labour bills because of new regulations also make it increasingly hard to compete. "We are already being squeezed by foreign producers at the beginning and end of the UK seasons." &#42

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