DCSIMG

We as farmers must become more efficient and lower costs

As the Chancellor George Osborne struggles with his autumn statement, the weathermen are predicting the coldest snap in 20 years with temperatures down to minus 15c or more.

It seems now that the weather is taking on George Osborne’s arctic predictions for the economy, competing to see who can produce the biggest freeze. Although we are barely into winter and snow has fallen a few times in Sussex already; we do know that in three months’ time it will be spring, whereas the chancellor’s autumn statement forecasts years of dark days, low temperatures and economic ‘blizzard’. It is very depressing indeed, and there is clear disagreement on how the economy could be best stimulated.

In reality, if one looks carefully under the political froth, there is not much difference in what is being advocated by either side on the political divide; a mixture of restraint and careful investment is what is needed, and the various party leaders know that, but some like to cut more than others, and the priorities for spending are different. As the Chancellor crosses his fingers (not joking!), we celebrate 70 years since William Beveridge introduced his report which led to the ‘welfare state’, and it is this balance of fairness, which is occupying many as we grapple with the problems.

Many MPs have been angered by tax schemes which run rings around the Revenue & Customs, with Margaret Hodge and her Public Finance Committee highlighting the problem of tax avoidance and the ‘industry’ advising wealthy individuals and corporations on the issue.

This is an issue over fairness, and a big change in fairness announced last week is that the Grocery Code Adjudicator which will oversee retailer relationship with suppliers is to be given powers to fine retailers from the start. It is 20 years since the NFU started to campaign for an Ombudsman to oversee retail practice, and to curb the abuse. Again it was MPs who forced the U turn on this, reacting to the bill’s second reading in November and insisting that naming and shaming is not enough, and that real teeth should be given to the adjudicator in order to enforce the code. The change of heart has been widely welcomed by organisations representing farmers, small businesses and fair trade campaigners.

Supermarkets were surprised at this sudden change and have reacted furiously, with the British Retail Consortium calling it ‘heavy handed and unnecessary’. Shadow Farming Minister Huw Irranca-Davies welcomed the decision which would allow a clear message to be sent to miscreants, and said Labour would go further by recommending it be applied to processors if it felt this was necessary.

The adjudicator will be in place early next year and supermarket buyers will need to be mindful of the brand’s reputation when negotiating with suppliers. Those who behave properly have nothing to fear, and as they all insist that they do just that; where is the problem in having a watchdog? I do hope that input cost and weather induced food shortages together with a need to behave responsibly, will result in a better balance between retailers and their suppliers. Indeed I was at the Sainsbury’s Conference last Friday at Stoneleigh Park in Warwickshire, where CEO Justin King and his team made it very clear how important farmers are to his business and how they value us.

However, he spelt out the tough trading climate (back to the weather again), the changes in shoppers’ habits, where they now have a smaller weekly shop and then ‘top up’. The average shopper is under financial pressure and spends less, choosing to do more preparation and cooking in the home, cutting waste; changes which are here to stay.

We as farmers must become more efficient, lower our unit cost, and our carbon foot-print (which I find are closely linked in many areas), offer consistency, great products, and be innovative. There was an awards ceremony, where great innovations and really first class farming businesses were given proper recognition, and well over a million pounds given to applicants with the best research and development projects, looking into better animal welfare, greater efficiency and so on. Other retailers do similar things, and if those who abuse are brought to book, everyone will benefit.

l Tesco is poised to pull out of the United States, five years after it arrived in the vast American grocery market. After racking up over £900 million in losses, and pulling out of Japan in June, the legacy of Sir Terry Leahy is now severely dented, especially after CEO Philip Clarke admitted that as a consequence of its overseas adventures, the company has under invested in the UK; something we all noticed.

Timing is everything as they say, and Tesco arrived in the States, just when the sub-prime mortgage lending crisis hit, but Warren Buffet (whose Berkshire Hathaway vehicle is one of Tesco’s biggest share-holders) claims that it is the strength of opposition which is to blame for the failure. Its plight was worsened by a fight with the Unions, and the ban in California of sale of alcohol from self-service tills. Why are these issues important? Major retailers in this country are our biggest customers, buying the vast majority of the food we produce and they are facing seismic changes, which will directly affect farmers and suppliers.

l I see more birds feeding around the yard this winter; the hedges are not laden with berries and there is not much for them to eat. We should celebrate the fact that farms are havens for little birds (and some big ones!) in times of need, rather than pedal the same old fund raising doom and gloom about modern agriculture’s role in the demise of farmland birds. Weather patterns have a huge effect on little birds and of course predation from other birds and mammals which are increasing in number. We have a moorhen that comes to check around our chicken coop each day for some food, walking purposely across the lawn with those big feet like the ‘hobbit’.

If you do feed birds in your garden, please make sure the biggest killer of all is unable to get at them; the not so domestic cat!

Gwyn Jones

 

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