Welsh TB Eradication Programme

Following the consultation on the Wales TB Eradication Programme which closed in January, the Welsh Government has published the Wales TB Eradication Programme Delivery Plan.  From 1st October 2017, there will be a regionalised approach to TB eradication in Wales with the introduction of Low, Intermediate and High TB areas.  This will enable measures to be more tailored to the different areas.  For chronic herd breakdowns there will be bespoke action plans drawn up.  In addition, where badgers are viewed to be contributing to the persistence of disease in chronic herd breakdowns, they will be trapped and tested.  If found positive they will be humanely killed.  Other key changes from 1st October include:

  • All cattle moved into the Low TB Area will require a Post-Movement Test (PoMT), this includes cattle moving from the High Risk and Edge Areas in England.
  • Pre-Movement (PrMT) will not be required for cattle moving within or from the Low TB Area.
  • In persistent and recurrent herd break downs, the ‘clearing’ test (the test that lifts TB restrictions) will no longer be allowed to be used as a Pre-Movement Test, a further PrMT will be required after 60 days.
  • All Inconclusive Reactors (IRs) in chronic herd breakdowns will be slaughtered.
  • In cases of persistent herd breakdowns, where cattle are moved under licence within a CPH, compensation will be reduced by 50% if the animals are subsequently slaughtered as a result of TB.  Keepers will be given time to restructure their holdings.
  • The current cap of £15,000 per animal will be reduced to £5,000
  • Phasing out of Exempt Finishing Units by 1st January 2018

TB levels were at their highest in Wales in 2008-09 and the number of new incidents has fallen by 41% since then, but recently the number of cattle being slaughtered has risen.  However, this has been attributed to the increased use of the more sensitive interferon-gamma test and a more severe interpretation of the skin test.  Later in the year an eradication target and interim milestones for the regions and Wales as a whole are expected to be announced.

GDT Price Falls

In contrast to what many were expecting, the average index at the latest GDT event fell by 0.8% to finish at $3,434.  This is the first decline in the index since the beginning of March.  WMP, which made up nearly half of the product sold, dropped by 3.3% to average $3,022 per tonne.  Cheddar also declined by 3.8%, whilst SMP, making up nearly a quarter of the products sold increased by 1.4%.

Arla Announces Price Rise

In a move which will be very much welcomed, Arla Foods has announced it will be raising its milk price from 1st July.  The net increase, taking into account exchange rates and cash flow adjustments, is a 1.44ppl to the manufacturing standard litre, taking it to 29.17ppl.  Being one of the ‘big two’ in the sector, this announcement will give suppliers optimism that others may follow suit.

Meat Markets

In contrast to the previous two years, average steer prices increased through the month of April and have continued to do so through May and June.  For steers meeting the R4L specification, during the week ending 10th June the price was 369.9ppkg, some 36.6ppkg above last year’s levels.  Heifer prices have increased to 371.5ppkg. The weakness of the Pound continues to help the competitiveness of the domestic market and in particular the cow price.  There has been good export demand for cow beef, prices have been increasing on the continent, as the recovery in the milk market has seen slaughterings reduced.  Carcases meeting -O4L specification for the week ending 10th June were 274.5ppg; this is a 38.4ppkg increase since the turn of the year.  Consumer demand remains robust for beef, but if the economy does falter we could see a switch to lower cost meats.

Lamb prices have taken a seasonal downturn as the number of spring lamb coming through markets increases.  In the week ending 17th June, the GB NSL SQQ fell by 12.76ppkg to end at 233.77ppkg.  Even so this is 53.27ppkg better than for the equivalent week in 2016.  The deadweight price for the week ending 10th June was 504.3ppkg, only falling marginally on the week.  The deadweight SQQ is 70.5ppkg more than for the equivalent week in 2016.  Weekly slaughter numbers are above last year’s and, if this continues as expected, prices could come under further downward pressure.

Pig prices continue to remain strong.  The EU-spec SPP for the week ending 10th June increased by 0.85p to 161.70ppkg.  This is 41p above year-earlier levels and is the highest price since July 2014.  The weak Pound continues to boost the domestic market, making imports more expensive and exports competitive.

Prices in the livestock sectors have certainly been given a boost due to the weakening of the Pound following the Brexit vote.  This could turn out to be a short term boost and producers need to be using this time to ensure their businesses are ‘match fit’ for the post Brexit world.

Dairy Alternatives

Descriptions such as ‘soya milk’ or ‘tofu butter’ are set to be outlawed following an EU ruling.  The European Court of Justice (ECJ) has decides that terms such as milk, cheese, butter, whey and cream should only be used to describe dairy products made from milk of animal origin.  They should not be used to market and advertise plant-based foodstuffs.  Whilst soya milk, for example, only comprises 1.6% of the UK liquid milk market it is the fastest growing element with volumes up by nearly 5% in the year to March 2017.  Whether it would find as much favour without the word ‘milk’ in the product name may soon be seen. 

Welsh Dairy Aid

The Welsh Government is making available £1,800 to each dairy farmer who collates and submits farm data for a benchmarking report.  To qualify for the funding the data must be completed in a specific spreadsheet supplied by AHDB and returned by 30th June.  The fund is available to dairy farmers in Wales who had a milk supply contract on 1st January 2016.  Those who have since given up milk production are still eligible, but those who have started up since 1st January 2016 are not eligible.

The support is being made available through the EU support package which the Commission made available last year to help dairy farmers due to the difficulties in the market place.  Those who participate will receive a report specific to their business which will highlight the strengths and weaknesses within the business compared to industry performance indicators.  It will point out the areas where improvement will have the most impact, showing the financial gain and also give a better understanding of the business cost structures.

Depending on the number of participants, there may be additional funding for those who have taken part and continue to supply milk, if this is the case, participants will be contacted.  Further information and details of how to complete and submit the spreadsheet can be found at https://dairy.ahdb.org.uk/activity-in-wales/projects-in-wales/welsh-conditional-aid-benchmarking/#.WUJkkun_rIW

Meat Merger

Two major players in the UK red-meat processing sector have agreed a ‘strategic partnership’.  Dawn Meats and Dunbia are to consolidate their UK operations into a joint venture.  This will continue to trade under the Dunbia name and have its headquarters at Dungannon in Northern Ireland.  It will operate 15 facilities across England, Scotland, Wales and Northern Ireland.   At the same time, Dawn will take over Dunbia’s Republic of Ireland operations comprising two plants.  This will result in Dawn having nine facilities across the Republic.  The deal has to be approved by the relevant competition authorities.  Between them, Dunbia and Dawn Meats process 900,000 cattle and 2.6 million sheep annually from the UK and Ireland.

BSE Status

The World Organisation for Animal Health (OIE) announced on 25th May that both Scotland and Northern Ireland have achieved ‘negligible risk’ status for BSE.  This is the safest level available.  England and Wales are still classified as having controlled BSE risk status.  This is obviously excellent news for Scotland and Northern Ireland, but particularly so as we look ahead to negotiating trade deals post Brexit.

TB Statistics

Latest TB statistics from DEFRA reveal new herd incidents in England, Wales and Scotland have fallen for the 12 months ending in February 2017.  But in England the results for the Edge Area show cause for concern.

There has been a 7% year-on-year drop in new incidents in England, whilst Scotland has recorded a 19% drop and Wales14%.  Although this is welcome news, the progress in England is not as good as in other parts of England.  In addition, it is worrying that  new herd incidents in England actually increased by 5% in the Edge Area.  There was a decrease in herds not officially TB free in Scotland, Wales and both the High Risk Area (-4%) and Low Risk Area (-22%) in England but again a 5% increase in the the Edge Area.

The data shows the total number of animals slaughtered in the 12 months to the end of February has increased in England by 3% to 29,425, in Scotland by 9% (162) and Wales by 15% (9,773).  In England though, whilst the number of slaughtered animals increased by 1% in the High Risk Area and fell by 10% in the Low Risk Area, the Edge Area saw a significant 21% increase in the number of animals slaughtered due to Bovine TB.  The full statistical notice can be found at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/614288/bovinetb-statsnotice-monthly-17may17.pdf

Small Dairy Farmers Scheme

A reminder that the Small Dairy Farmers scheme closes on 31st May.  The scheme is open to all productive English dairy farmers whose annual cows’ milk production in the 2015/16 milk year was less than 1,000,000 litres (or equivalent in kgs).  It is just a case of completing the form and providing the proof of deliveries.  More information can be found at https://www.gov.uk/guidance/small-dairy-farmers-scheme