Farm Diary April 15 2009

LIGHT rain has provided some much needed moisture in the last week. The grass is growing strongly now, and our new seeds are coming up, with some 'lime green' showing in the drill rows. We were all drilled up and rolled before the rain came, so it was perfect for us at Crouchlands, and of course the sand at Tillington is always in need of rain between now and October!

We are starting to work down the maize seed beds this weekend and we will be drilling the first fields as you read this. We are on target this year, but due to the delay in delivering and spreading the last fields with 'lime cake' from the sewage works, we might have to work some 24 hour shifts in order to get the last 100 acres in on time.

I have got some lime being spread this week, as a result of testing every acre of maize ground for acidity, and we are applying a little extra chemical Nitrogen and some chemical Potash, in order to get nutrient balance absolutely right.

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It will be interesting to see if all this attention to detail and extra money makes a difference, because in the end we are at the mercy of the weather. Hopefully though, we will maximize our returns whether it is a good or bad year.

My worry is that in a bad year, will the extra time and money invested yield a return? Seed bed preparation, drilling at the right time and most importantly weed control, especially at the early stages of growth, are the key factors to growing good crops of maize. I am still smarting after the poor tonnages of last year. It was a shock after many years of growing maize with good results.

The building site is quiet, as the Germans indulge in another holiday! How can the German economy have such an amazing track record when the workers are on holiday most of the time? They are very regimented in their work, and have detailed plans of what they do each day, and infuriatingly will not do 'tomorrow's work' when some problem prevents them from doing 'today's work schedule'.

The quality of their work is very good, and they do seem to get a lot done every day. On balance I am therefore happy; if it wasn't for all the holidays!

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Having laid massive foundations of re-enforced concrete a meter deep, I was puzzled to see the electricity company arrive with switch-gear that two men could carry (although they had an expensive crane). The outer foundation which again is a meter deep of re-enforced concrete is still bare, and I asked what was going to be put on that. 'A fibre-glass shed'. Was the answer! I fell over and had to be given oxygen.

Eight cubic meters of high specification concrete, with steel re-enforcement just for a couple of hundredweight and a plastic shed? No wonder our bills are so incredibly expensive. We could have had a small nuclear reactor on these foundations!

Milk prices are falling rapidly, with processors announcing cuts almost every day this month. With the cost of producing a litre of milk for the next 12 months in the region of 27pence (Tesco/Promar), many farmers are 3 pence below that, and farmers supplying the troubled Co-op 'Dairy farmers of Britain' down to 20p, and as the seasonal deductions for spring milk kick in, they could be as low as 16-17p.

This is a desperate position for many farmers, and some will find it hard to hang on until late summer when higher prices will be paid.

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Milk production in this country is now at its lowest for 35 years, and is going to go lower still as farmers leave, others cease to expand, and many cut back on high yields.

We are busily exporting our cheese and manufacturing market, and if we are not careful, we will end up providing liquid milk for drinking and a small amount of branded cheese in this country. This is despite the strong pound, and over 12 years of producing the cheapest milk in Europe at farm level. Where's the money? Retailer's pockets.

No change in the price the consumer pays, and the margins made by retailers, especially on cheese are obscene. New research also shows that manufacturers spend 8 billion a year funding promotions, and retailers are pocketing 90 per cent of the profits.

In 2003, that figure was 78 per cent, but by 2008 it had risen to 90 per cent, halving the supplier's share of the profit. Manufacturers use promotions to support volume, keep retail relationships 'strong', and to hit customer objectives.

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If we look at cheese; of the 10.38pence increase (per litre of milk) paid by the consumer for mild cheddar, 9.7p went on to the retail margin, with processors margin falling by 2p per litre due to the extra cost of milk from farm as a result of increase input costs.

On mature cheddar, of the extra 9.85p, 6.97 went on to the retail margin. The availability of cheap cheddar from Ireland is putting huge pressure on cheese prices, with 'internet auction' methods used increasingly by retailers to drive prices down at manufacturer's expense.

What does the consumer get? A poor quality cheese, poorly labeled (often pretending to be British), at a high price. Poor value indeed. Always look for the 'Red Tractor' and you will know that the product has been produced to the high standards of 'British Farm Assurance'.