Category: Dairy & Livestock

The application window for applying for an NVZ grassland derogation has been extended until 20^th March 2017 (previously 30^th December 2016).  A derogation can only be applied for by telephoning the Environment Agency on 03708 506 506.

Those within NVZs are normally subject to a limit of 170kg nitrogen per hectare per year from livestock manure averaged across the area of the farm.  However a derogation can be granted to allow up to 250kg nitrogen per hectare per year from grazing livestock, if at least 80% of the agricultural area of your holding is down to grass and the nitrogen comes from grazing livestock manure (i.e not pigs, poultry or veal calves.  When applying farmers will need information on the area of grassland on the holding and the amount of manure nitrogen produced on the holding by various categories of livestock.  For more information on what is required please go to: https://www.gov.uk/guidance/grassland-derogations-for-livestock-manure-in-nitrate-vulnerable-zones

DEFRA are still in negotiations with the Commission over the renewal of the UK’s derogation.   In the meantime DEFRA is continuing to go ahead with inviting applications for 2017 on the same provisions as in previous years, but note it may have to withdraw derogations if the Commission does not grant arenewal or if the conditions are changed.

Further to our article on 9th December DEFRA has confirmed an outbreak of Avian Flu at a turkey farm near Louth in Lincolnshire.  The H5N8 strain is the same one that has been affecting poultry in Europe.  The outbreak was confirmed on Friday 16th December.   In the region of 5,000 turkeys have been affected.  A 3km Protection Zone and 10km Surveillance Zone has been put in place around the farm.  The Prevention Zone, which means all poultry and captive birds should be housed, if possible, remains in place at least until 6th January and may now be extended.  All keepers should observe strict biosecurity measures and report any suspected diseases to APHA tel. 03000 200 301.  Further advice is also available on the DEFRA helpline on 03495 33 55 77.  Public Health England has confirmed that the risk to human health is very low; there has never been a recorded case of H5N8 in humans.

After four consecutive price rises, the last Global Dairy Trade (GDT) Event of 2016 has seen the index of prices fall by 0.5%.  There was no change to the SMP index price compared with the auction held earlier in December.  The WMP index has fallen marginally by 0.8%.  It remains to be seen how much affect the sale of SMP out of EU intervention stores has on prices going forward.

The Government’s strategy to combat bovine TB is ahead of schedule.  DEFRA is set to apply for Officially TB-Free (OTF) status for over half of the country next year, this is two years ahead of the published timetable.  The OTF area will cover the north and east of England which is classified as the low-risk area.  Obtaining OTF for this part of the country will be a significant step in the Government’s 25-year plan to see the whole of the UK classified as OTF by 2038.  It will also be the first time anywhere in England has achieved this status and will provide a boost to export opportunities.

As part of the overall announcement, statistics have been provided on the 2016 badger cull.  Across the 10 licenced areas 10,886 badgers were removed this year.

DEFRA has also announced it has opened a consultation seeking views on proposals to introduce a supplementary licence for farmers to continue badger disease control measures after the first four years of culling has finished.  The full consultation can be found at https://www.gov.uk/government/consultations/bovine-tb-supplementary-badger-disease-control.  The deadline for views is 10^th February 2017. The Chief Veterinary Officer has said that it is likely the disease risk from badgers will increase in the cull areas as the population recovers.  He has therefore said that consideration should be given to maintaining the badger population within these areas either at the same or below that achieved at the end of the four year intensive cull period.  DEFRA also said it plans to resume the Badger Edge Vaccination Scheme in 2018 when it expects the vaccine to be available again.  This scheme, which is currently on hold due to a global shortage of the vaccine, offers funding for private badger vaccination in the edge area counties.

Other measures which have been been announced following responses to consultations and as part of the 25-year strategy include:

• A wider use of the blood test alongside the skin test in high-risk areas.  This is a more sensitive test and should help prevent leaving infected animals within the herd
• To bring the measures to control the risk of TB within pigs, sheep, goats, deer and camelids more in line with cattle controls and the introduction of new statutory compensation arrangements for these species
• To update the online tool, ibTB, every two weeks rather than once a month.  The tool allows keepers to track if there have been outbreaks near their holding

AHDB Beef and Lamb has released its latest benchmarking figures for English beef and sheep enterprises.   The figures in the 2016 Stocktake Report relate to the year ending 31^st March 2016.  The table belowshows the net margins for each enterprise for the last two years and the difference between the average producer and a top third producer where available.

In the main, the cattle margins are better than last year and improved compared to the last three years; only beef finishing up to 16 months bucks the trend.  The top third of sheep enterprises continue to see positive returns, but the average producer for both beef and sheep enterprises continue to struggle to make a positive net margin return.  It should be noted that the results do not include income from the Basic Payment Scheme, any Agri-environment payments or diversification income.  Many of these types of farms will be reliant on such income to produce an overall farm profit. 

The figures below are only for the top third and average producers, there is a significant further gap to the bottom third producers.  The level of fixed costs between the top third of producers and the average show a marked difference, highlighting the importance of looking at total costs rather than just the gross margin.  In addition, there is a difference in the physical performance, particularly within the suckler herds.  For example, the Non-SDA top third of producers had shorter calving periods, more calves born alive and a lower percentage of empty cows or heifers.  The report aims to offer benchmarking figures and physical information for producers to compare their enterprises against.  This year, for the first time, there is space to put producer’s own figures in.

For the second year, international comparisons have also been included in the report.  These were compared on the basis of US Dollars and therefore some exchange rate impacts are felt.  For suckler herds, once again only the US had returns greater than costs.  The UK (upland farm) and Germany were again the only countries to have returns lower than their cash costs (i.e. those costs not including imputed rent, unpaid labour, depreciation and finance).  For finishing units, the USA and China had returns higher than costs whilst for sheep breeding enterprises, New Zealand and China were profitable.

The full report can be downloaded from http://beefandlamb.ahdb.org.uk/returns/stocktake/

The latest GDT auction on the 6^th December saw the index of prices rise by 3.5% to $3,622 per tonne.  This is the fourth consecutive rise in values.  Part of the increase in prices is down to fears over availability, with volumes being sold through the auction around a quarter down on the same time last year.

The Government Chief Vet has introduced new measures as a precaution against avian influenza.  With cases of the highly contagious H5N8 strain of the disease being found on the French coast, and in the Netherlands, extra precautions are being urged on UK poultry farmers.  Free-range producers have been told to keep their flocks inside (this will not prejudice their free-range status).  Where this is difficult, for example with geese or game birds, then contact with wild birds should be minimised – for example making sure that food and water is not accessible to wild birds.  Poultry keepers are also being urged to step-up biosecurity measures.  The whole of England will remain as a ‘Protection Zone’ for 30 days from 6^th December.

There have been a number of milk price announcements over recent weeks;

• Muller has stated it will be increasing its non-aligned milk price by 2.5ppl from 1^st January.  The retail supplement is expected to be 1.1ppl.  Following farmer meetings (see November’s article) concerning their proposed new milk contract, Muller has said it will be taking time to review the feedback and will be delaying the introduction of its new contract offer.  Contracts will now be offered in January with the option to start from February.
• Arla has announced it is raising its December price by 2 Euro Cents, this equates to about 1.49ppl and in an unusual move for the company, has also said it anticipates a similar rise in January.
• Dairy Crest Davidstow has confirmed a 2ppl increase from 1^st January and a further 2ppl rise from 1^st February; this follows a 1.78ppl increase in December.
• AJ & RG Barbers of Somerset have announced a 2.5ppl increase for December and 2ppl for January with a further 1.5ppl in February

• Lactalis has signed an agreement to guarantee a minimum price for the whole of 2017 of 27.5ppl for a standard liquid litre and 28.47ppl based on a standard manufacturing litre.  This sees the milk price increase by about 2.5ppl in January.  A number of large producers have recently left the company, most heading for Yew Tree Dairy in Lancashire which is probably the main reason for Lactalis coming out with this price guarantee.

• First Milk has announced from 1^st December its Midlands and East Wales ‘A’ milk price will be increased by 2.5ppl with the Haverfordwest, Cumbria and Scottish pools seeing a 2ppl increase from the same date.  All ‘B’ milk will be 25ppl for December.

• Other price announcements include; 2ppl increase from 1^st December for suppliers to Paynes, Graham’s and Wyke Farms.  From 1^st January South Caernarfon Creameries has announced a further 2.5ppl increase

Up to 175,000 dairy cows in the Netherlands could be culled in an effort to reduce phosphate pollution.  This is around 11% of the national herd.  The phosphate limit in the Netherlands is currently 172.9 million kg, but this has been exceeded for the past three years.  Dutch industry bodies including LTO Netherlands, NZO, Nevedi, NAJK, NMV and Rabobank have put forwardproposals to the Dutch Government to reduce the levels produced by a total of 8.2m kg.  The measures, if agreed, would see farmers being compensated for reducing their cow numbers, this is anticipated to reduce phosphate production by 2.5m kg.  Those that produce more than their predetermined reference amount will be penalised, this is expected to result in a further 4m kg reduction in phosphates, with another1.7m kg being reduced by feed compounders lowering the levels of phosphate in animal feed.  €50m has been made available to support the measures.

Natural England has launched the Farming Ammonia Reduction Grant Scheme for dairy and beef farmers.  The scheme is part of the Countryside Stewardship Scheme and will provide grants to help pay for covers to existing slurry stores.  The amount of grant available is £61 per square metre for self supporting covers or £11.20 per square metre for floating covers.  Applications must be received by Natural England by 31^st January 2016.  If the scheme is oversubscribed NE will prioritise applications on a first-come-first-served basis.

Applicants will be notified of the outcome by the end of March 2017.  If successful, they will receive a visit from an advisor within two weeks of being notified.  The advisor will assess the slurry store for the type of covers being proposed.  A report will be drawn up for NE.  A copy will also being given to the applicant along with further advice on reducing ammonia emissions and other diffuse pollution on their farm.  NE will confirm whether the application has been successful within two weeks of them receiving the report.

Photographs will need to be submitted along with the claim by 31^st July 2017.  Payment will be made by 30^th September 2017.  Further information and applications forms can be found on the DEFRA website at https://www.gov.uk/government/publications/beef-and-dairy-farmers-apply-for-a-farming-ammonia-reduction-grant