TESCO HAS announced that it will invest £6m over two years to help support British agriculture.
The retailer has created the new Tesco Cheese Group (TCG), which will guarantee dairy farmers an above market price for the milk they produce for Tesco’s British own-label Mild, Medium, Mature, Extra Mature, Red Leicester and Double Gloucester cheese.
The move will deliver a fair and consistent pricing model for UK farmers, and will provide them with the security and ability to plan ahead for the future.
Building on the success of the Tesco Sustainable Dairy Group (TSDG) which was established in 2007, and pays a market leading price for dairy farmers who supply Tesco with milk to the help them manage the economic volatility of the market; the new Cheese Group is the latest addition to the retailer’s programme of initiatives to support British farmers.
Commercial Director for Fresh Food Matt Simister said: “We have created this new cheese group to help us to meet customers’ needs whilst also establishing a long term sustainable livelihood for our farmers.
“By providing them with the assurance of our commitment, we are hoping to give our producers the confidence to invest so that they can deliver what customers are looking for in an efficient way.
“It is our hope that up to 200 more dairy farms across Britain who produce milk for our British cheese, in addition to the 600 producing milk through the TSDG, can work with us in partnership to create a successful and sustainable future for their production.
“For almost a decade we have worked with dairy farmers to offer the best possible quality milk , produced to the highest standards for our customers, whilst ensuring farmers receive a fair price for their milk.
“We are confident that this new initiative will enable producers, for our own-label cheese, to also plan and budget for the future; and focus on the things that matter most- meeting high animal welfare and food quality standards for customers.”
Peter Willes of Parkham Farms commented: “The new pricing model will ensure that we and our farmers are paid a premium price above that of the market reflecting the quality of our cheese and the milk that goes into it. We believe it will provide a long term and sustainable structure to help build our relationship with Tesco even further.”
Mike Gallacher, CEO of First Milk said: “This new agreement we have concluded with Tesco is about establishing a long term, progressive and sustainable supply chain partnership over the coming years. While the current context is hugely challenging in dairy, we need to continue to keep focused on the long term ensuring that we put in place business models that can deliver for our customers, consumers and producers.”
The new mechanism provides clear, equitable and transparent pricing which will be set regularly throughout the year.
The price will reflect the market and will also award farmers a two pence per litre bonus- in recognition that they must adhere to the Red Tractor assurance scheme, as well as additional Tesco welfare standards, to improve cow health and welfare.
FUW welcomes new minister
THE FARMERS’ UNION OF WALES has welcomed the announcement in continuity in the Welsh Government, following the Cabinet reshuffle (Nov 3), which saw Lesley Griffiths continuing in her role as Cabinet Secretary for Energy, Planning and Rural Affairs, with the addition of a deputy, Hannah Blythyn as Minister for Environment.
Responding to the news, FUW President Glyn Roberts said: “We welcome the continuity of keeping Lesley Griffiths as our Cabinet Secretary. Our working relationship has been a positive one and we look forward to continue working with her.
“With issues such as climate change and water management dominating agendas such as those listed in the Well-being of Future Generations Act, we are pleased to see Mrs Griffiths will be able to continue to fight for the interests of our rural communities – communities for which agriculture is a cornerstone.
“We are also pleased to see that Hannah Blythyn has joined the Cabinet. The addition of a new Minister recognises the complexity of the portfolio and we look forward to working with Hannah in the context of her remit.
“We met with Lesley Griffiths last week and will now seek a meeting with Hannah Blythyn at the earliest opportunity, to discuss those issues which are of concern to farmers and have an impact on all aspects of her portfolio.”
Commitment on funding welcomed
NFU CYMRU has welcomed the Welsh Government reaffirming its commitment to ring-fence funding for Welsh farming post-Brexit.
Last week NFU Cymru met with Cabinet Secretary for Environment and Rural Affairs, Lesley Griffiths AM, and in a wide ranging discussion covering a range of topics, Brexit topped the agenda.
Following the meeting, NFU Cymru President Stephen James said: “I am pleased that in our meeting with the Cabinet Secretary, Lesley Griffiths AM, she reaffirmed the commitment from the First Minister that funding for Welsh agriculture from the UK Government to the Welsh Government will be ring-fenced for Welsh farmers post-Brexit.”
The Cabinet Secretary’s commitment follows on from a response that the First Minister gave to Plenary on October 24 and reaffirms the commitment in the Welsh Government / Plaid Cymru Securing Wales’ Future document which stated that it is ‘essential that equivalent or greater resources to those Wales would have received from the Common Agricultural Policy (CAP) are provided from the UK to support Welsh farming’.
Stephen James continued: “NFU Cymru’s message on future funding arrangements has been clear and unequivocal. Governments in Cardiff and Westminster must maintain current levels of investment for farming in Wales, to ensure Welsh farmers remain competitive and can continue to produce food to the highest standards whilst maintaining and enhancing our environment and meeting our climate change obligations.
“At Plenary, the First Minister mentioned that he would consider looking at alternate ways of working and we would absolutely agree with that. This is an opportunity for us in Wales to work collectively to create a new agricultural policy framework that helps to achieve our vision of a productive, progressive and profitable farming industry that delivers jobs, growth and investment for Wales.
“We see the development of a new policy framework as an evolution over a period of time, with the timeframe for change very much determined by our future trading relationship with the EU.
“With the UK Government having committed to the same cash total in funds for farm support until the end of this Parliament, the next step is for the UK Government to clarify how these funds will be allocated amongst the home nations. This allocation should be based on the current formula for distributing CAP funds within the UK.
“Farming is a long term business and we need clarity and certainty on a range of issues including funding, trade and future agricultural policy. Developing agricultural policy and budgetary frameworks should be developed in partnership between the governments of the UK, so that a common policy framework can be agreed. A common policy, but a policy which allows flexibility for each country to take account of the pattern and practice of farming within their country.”
Family farms on the brink
FEWER than one in five family farms are making a profit from their farming activity, according to research undertaken by the Andersons Centre on behalf of The Prince’s Countryside Fund.
Analysis of data from 172 participants in the first year of The Prince’s Farm Resilience Programme has shown that the average farm made more than £20,000 loss from farming activities, and instead is reliant on other income streams to make a profit.
The shortfall was made up by income from non-farming activity, such as tourism enterprises, renewables, direct selling of products to the consumer, or income from working off farm as well as farm payments.
According to the report, broadly speaking, farmers face two business choices in order to cope with declining economic fortunes: either to focus on a farming solution or to redeploy resources away from agricultural production. In reality, it may be a combination of the two or farmers may vacillate between the two courses of action with periods of off-farm work generating income interspersed with a focus on the farm.
There are, of course, two further options open to farmers. First, they may cease farming, either entirely through selling up the farm or by letting their land. Or secondly, they might tighten the belt and continue business as usual.
Worryingly, many operators of small farms, believe the near future will see them retiring or otherwise leaving agriculture altogether.
Lord Curry of Kirkharle, chairman of The Prince’s Countryside Fund said: “Although the initial figure is startling, the research from the Andersons Centre shows that farmers are increasingly looking at their farms as a business, and are proactively looking for how they can generate an income from diversified sources to remain profitable.
“This is more crucial now than ever. Farmers must develop their skills and improve their business confidence to survive. If they do not, the risk of extinction for the family farm is very real; farmers must act now to both strengthen their core farming business and to spread the risk.
“The Prince’s Farm Resilience Programme is vital, because it equips farmers with the tools they need to remain financially stable. Maintaining diversity of farm size is essential to protect the British countryside and our rural communities.”
The Andersons Centre developed a bespoke and easy to use Business Health Check Tool for The Prince’s Farm Resilience Programme, allowing farmers on the programme to benchmark their performance, identify their strengths and weaknesses, and make informed business decisions as a result. Data from this tool was analysed to identify trends and performance in the farm businesses involved in the initiative.
The Prince’s Farm Resilience Programme aims to help 300 family farms, across 15 locations, each year. It brings together like minded family farm enterprises in local networks, to review their current activity and identify improvements and opportunities that can be made on-farm to build resilience, effectively helping farmers to take control of their businesses. Farmers who took part in the first year have confirmed they have higher levels of confidence in their business, better business management, and stronger communication within their family.
The Prince’s Farm Resilience Programme directly addresses some of the issues raised in a report commissioned by the Fund from the University of Exeter, ‘Is there a future for the small family farm in the UK?’
The report detailed how the loss of small family farms would have devastating effects for the British countryside, leading to loss of employment, breakdown of rural communities, and potential negative environmental consequences. The report concluded that it was essential to maintain a diverse range of farm sizes, but that this was in significant jeopardy.
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