Trade deals, Britishness and bird flu – Norfolk farmers outline their key challenges for 2018
- Credit: Copyright: Archant 2016
As another turbulent year draws to a close, we asked Norfolk farmers to highlight their sectors' key challenges for 2018 – with Brexit trade deals, market volatility and labour shortages all high on the priority list.
Norfolk NFU chairman Tony Bambridge is managing director of seed potato specialists B&C Farming at Marsham, and is also a tenant farmer at Park Farm in Blickling where he grows wheat, sugar beet and barley, as well as keeping a herd of Lincoln Red cattle.
He said while the weak pound has raised the cost of some imported farm inputs, it also presents the British food industry with the opportunity to regain lost market share in some commodities.
'Potato products is one area close to my heart with well over one million tonnes of potato products entering our market, and I am sure this will be repeated across several product lines,' he said.
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'As we march towards Brexit and what ever that eventually means for us as farmers we do need to spend that time wisely and ensure we have strong relationships with our customers to supply British product from our farms to the consumer. We will be able to proudly bang the drum of Britishness like never before and must take every opportunity to do so.
'2018 will be the year to make sure our businesses are on track to survive the buffeting from leaving the EU and implications of a change from the Common Agricultural Policy to the British Agriculture Policy. I think that will be about being leaner and fitter, with robust plans in place and being technically-led to achieve better outputs.'
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Kit Papworth, a director of LF Papworth, a contracting business based at Felmingham, near North Walsham, said understanding and managing risk would be vital against the uncertain backdrop of Brexit.
'I was reminded recently that the grain markets in the 1990s were entirely predictable,' he said. 'The spot price of wheat rose between £1 and £2 per month, which just about covered the cost of interest on the money and grain storage. Farmers simply didn't need to know much about global markets. How things change.
'Whilst Brexit will inevitably dominate the headlines in 2018, the uncertainty that will surround it is bound to create jitters in all of the markets that affect UK farms. The biggest challenge for all of us will be to understand and manage the volatility created and make the most of the opportunities.
'This does not just apply to the grain markets, but currency markets, the strength of sterling and oil for fuel and fertiliser. Risk management tools will help, as will sound advice but an understanding of these markets will be crucial.'
Peter Howell's family farm business based at Bintree near Fakenham grazes hundreds of beef cattle across Norfolk, producing £2m of meat for supermarkets including Lidl and Morrisons.
He said the government's Brexit negotiations were his biggest concern for 2018. 'Our biggest worry would be what sort of trade deal we get,' he said. 'We have got large countries like America and Brazil with a massive amount of beef in cold stores, and they could undercut us terribly. We saw it happen three years ago when Poland unloaded a lot of boxed beef into this country, and it dropped our price by £40-50 a head in a week.
'This is why it is so crucial for us to get a decent deal which protects us against cheap imports. I agree we have got to produce to very high standards, but if we open the door to these other countries which don't have to adhere to the same standards, then they will undercut us very easily.
'It is all very well trying to expand and do more cattle, but all of a sudden our market could come under heavy financial threat. We all think we are important, farmers do, but we are a very small cog in world production.'
Mark Gorton, a director of Traditional Norfolk Poultry based at Shropham, said: 'Labour is our number one concern. Ever since the Brexit vote it has become increasingly difficult to find people looking for work. This is hardly surprising given the record low levels of unemployment in the UK, and overseas workers becoming harder to find.
'It must not be underestimated how important overseas labour is to our industry to fill the jobs that not many people want to do. It is vital for everyone that local companies can thrive, bringing the benefits to the local economy and further afield and allowing us to produce the very best quality home-grown British free-range poultry.
'The ever-present threat of bird flu is also a huge concern and we can simply cannot let our guard down – even though there are no reported cases in the UK yet, it is still out there and anyone keeping poultry, regardless of how many, must be vigilant and maintain as much biosecurity as possible.'
Lucy Stowell, Norfolk YFC (Young Farmers' Club) chairman, said: 'As I see it, Brexit, regulations and trade will be challenges faced in 2018.
'This is an exciting yet uncertain time. Working with the National Federation of Young Farmers, members have had the opportunity to meet with Defra representatives and will continue to do so over the next year to help shape the future of the UK agricultural industry and policies.
'Meetings across the country speaking to members as to what is important to them have been fantastic, as it means all voices are listened to in all areas of the UK. After all, what is needed in East Anglia will be different to those in the South West and North East. I think it is important for the Young Farmers to get their say in future policies as they will be the ones working to these for many years to come.'
Heidi Smith, business manager for Norfolk FWAG, the county's farming and wildlife advisory group, said she was in no doubt of the major issue facing farm conservation.
'It's undoubtedly Brexit,' she said. 'It will affect every single aspect of the industry, from crop protection products through agri-environment schemes to the end market for commodities. Many years of chaos lie ahead. Norfolk FWAG is worried that it is difficult for farmers to concentrate on and consolidate the great environmental work they have started, when they are constantly trying to read the tea leaves and have no certainty in any aspect of their business.
Fiona Hirst, an associate in the agricultural business consultancy at Brown and Co in Norwich, said adjusting to a new digital tax regime must be a priority for many farm businesses in 2018.
'The drive for a modern tax system based on a digital technology has come about to reduce the amount of avoidable errors,' she said.
'Making Tax Digital is part of the government's plans to simplify tax systems and it is designed to get all tax records online and up to date so they are available to both taxpayers and HMRC. Businesses with a turnover above the VAT threshold and completing quarterly VAT returns will be the first being brought into the new regime from April 2019.
'These businesses will be required to keep their records electronically and to make quarterly returns of 'real time' accounts information – ie, to submit a quarterly tax return. This information will be sent direct from the accounts software.
'There are still some farms using paper-based accounts systems and these will be hit hardest by this change.
'In some cases this will be a very costly experience for the farmer who will need to invest in a computer and an electronic accounting software package.'
Ben Underwood, East regional director for the Country Land and Business Association (CLA) said political decisions taken in the next 12 months will' begin to define the future of farming, the environment and landscapes, the rural economy and countryside communities'.
'2018 will be an important year with some tough challenges ahead but also hopefully some answers,' he said. 'The release of the long-anticipated 25-year environment strategy, the Agriculture Bill, an Immigration Bill and on-going trade talks are all of crucial importance to those living and working in rural areas.
'Centre stage though must be a profitable, resilient farming sector which supports vibrant local communities. Our sector faces challenges and it is clear that we will need to farm differently in the future. Concentrating on the highest quality food production and exploring new opportunities for environmental and countryside management will be a sound foundation for success.'
'There are many local issues that impact on our members in the eastern region that can hold back a thriving rural economy. From an often ineffective planning system and the urgent need for better broadband and connectivity, to fly-tipping, hare coursing and other rural crimes.'