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Post Brexit Farming: Get Fit and Engage

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Slides presented at NFU Brexit Conference/Consultation Event, Worcestershire, 3 February 2017
Link to Conference Press Release:
http://www.nfuonline.com/about-us/our-offices/west-midlands/worcestershire/farmers-discuss-the-future-of-farming-post-brexit/

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Post Brexit Farming: Get Fit and Engage

  1. 1. Post Brexit Farming Charles Cowap Harper Adams University 3 February 2017
  2. 2. Brexit: What Should We Do? • Ostrich • Complete strategic review and fundamental business reshaping • Disinvest
  3. 3. The Brexit Ball • Knowns • Known Unknowns • Unknown Unknowns
  4. 4. Danger Students At Work Remember the Corn Production Act 1917 Agriculture Act 1920 Agriculture Act 1921
  5. 5. PAY NO SAY STAND ALONE NEW EUNO EU SHAFTED NEW WORLD ORDER HOBBLED WRECK North-South: The EU does not change much as a result of Brexit. UK signs a deal on EU terms (North) or ‘hard’ Brexit(South) East-West: Brexit provides a strong stimulus for EU Reform. EU emerges as a stronger and more unified entity (East) or falls apart (West) Take Aim at the Brexit Dartboard © Charles Cowap 2016
  6. 6. GET FIT AND ENGAGE
  7. 7. GETTING FIT – THE BEST AND THE REST How is West Mids Looking? OUTPUTS, INPUTS AND INCOME PER FARM WEST MIDLANDS FBS FOR 2015 (1.2.2017) Area of farm (ha) 128 Acres 316 Total Output 207,363 Total Variable Costs 85,233 Farm Gross Margin 122,130 Farm Overheads 135,615 'Profit' -13,485 BPS income included above -20,599 'Profit' before BPS -34,084 WEST MIDLANDS FBS FOR 2015 (1.2.2017) Farmer net worth 1,807,766 Investment 'return' -1%
  8. 8. Perform! 1. Large Dairy Farms (£/Ha) Average Size 181 Gross Farm Output 3,404 Gross Profit 1,557 Overheads 1,480 Net Profit 76 Top 25% 157 4,147 2,157 1,469 689 BPS and Ag Env included above 174 164 Net Profit before BPS etc -98 525 FBS Benchmarking Data Years Ending late 2015/early 2016
  9. 9. Perform! 2. Large Cereal Farms FBS Benchmarking Data Years Ending late 2015/early 2016 Average Size 500 Gross Farm Output 1,468 Gross Profit 981 Overheads 792 Net Profit 189 Top 25% 524 1,579 1,158 699 459 BPS and Ag Env included above 209 211 Net Profit before BPS etc -20 249
  10. 10. BPS and Ag Env included above 284 161 Net Profit before BPS etc 1,473 3,045 Top 25% 63 17,535 11,716 8,509 3,207 Average Size 54 Gross Farm Output 15,671 Gross Profit 10,148 Overheads 8,390 Net Profit 1,758 Perform! 3. Horticulture FBS Benchmarking Data Years Ending late 2015/early 2016
  11. 11. Engage! Huffington Post
  12. 12. Value from farming • Remember the Modulation Debate, December 2013? • Modulation at 9% or 15%? • RSPB and others said CAP was costing £400 per household and Pillar 2 payments give far better value for money so Defra must strike at 15% to Pillar 2 ….. • You said farmers would be ruined at anything more than 9% to Pillar 2 • Owen Paterson split the difference at 13 ….
  13. 13. The Farming Argument was all about farmer fortunes • And not about Value at all • But Consider our milk and cheese consumption for example • Average dairy product consumption about 4 litres of raw milk a week, 220 l pa • Average yield 7,327 litres per cow • Each cow therefore supports 36 people • Cow needs 0.5 ha • Average herd 125 cows  feeding 4,500 people • Direct BPS etc say £210/ha • Cost per consumer for dairy product support £2.92 • And if you took it away??
  14. 14. How Many People do you feed?
  15. 15. To conclude: • Use what we know • Get in shape and stay in shape • Promote R&D • And especially its uptake! • Promote the value of farming • Nutrition • Welfare • Water • Economy • Farming and food production is also an ecosystem service in its own right • Engage with the public • The message: UK Farming Benefits UK Consumers • UK Farming Gives Value for Money  Make Sure It Does! What did you do today to make the public and politicians admire British Farming? And how would anybody know?

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