The Farmers’ Union of Wales (FUW) has emphasised the importance of appointing a dedicated minister with responsibilities for farming and rural affairs.

“Agriculture and rural affairs are key to our economy, and central to addressing and dealing with the major challenges of our generation,” said FUW President Glyn Roberts.

“With issues such as climate change and water management dominating agendas such as those listed in the Well-being of Future Generations Act, we need a dedicated minister to fight for the interests of our rural communities – communities for which agriculture is a cornerstone,” he added.

Mr Roberts said the call tied in with the FUW’s vision of a Rural Powerhouse for Wales which recognises the central role agriculture and rural areas must play in addressing the challenges of the future, while ensuring the focus does not just fall on the M4 and A55 corridors.

“This can only be done by having a full minister who sits on the Welsh Government cabinet and has responsibilities for agriculture and rural affairs.

“The FUW looks forward to working closely with the incoming Government in order to ensure priorities are met for rural Wales and Wales as a whole,” he added.

Under the previous Welsh administration the agricultural portfolio was moved between ministers and deputy ministers a number of times following Welsh cabinet reshuffles.

[caption id="attachment_6348" align="alignleft" width="263"] FUW Milk and Dairy Produce Committee Chairman Rhydian Owen[/caption]

The introduction of the Dairy Code of Practise in 2012 has done little to positively affect the farm gate prices received by producers and is largely ineffectual in the midst of market surpluses and a lack of alternative options.

This was the conclusion of the recently published Farmers’ Union of Wales report on the dairy sector.

In addition the report highlighted that the Code can do nothing to better the prospects of producers who have been served notice.

Therefore the Union continues to reiterate that smaller producers and those in remote areas are being left vulnerable during periods of oversupply.

“The industry could see even more falls in producer numbers as processors ‘cherry-pick’ producers in a bid to reduce operational costs,” warns FUW Milk and Dairy Produce Committee Chairman Rhydian Owen.

For producers wishing to take up the option, the FUW has been a long-standing supporter of the inclusion of market-related pricing formulas within dairy contracts.

“Supporters of the formula believe it could form the foundation for prices which, while continuing to vary between contracts, nevertheless represent the true value of milk.

“This would reflect a supply and demand dynamic that UK milk prices have failed to recognise over the last decade,” added Mr Owen.

Other types of contracts, such a futures, may be of benefit to some producers; although this will depend on the individual business and the degree to which some or all of the milk is included, according to the FUW dairy report.

Mr Owen further stated that whilst the industry needs different types of contracts to cope with embedded marketplace volatility, there must also be a concurrent effort to increase transparency and proper policing in the UK supply chain.

Contracts which include mechanisms such as A and B pricing must also work for the producer when demand outstrips supply and should not be used primarily to reduce incomes in periods of oversupply.

“Proper policing should help to ensure that contracts remain fair and do not exploit primary producers. The FUW has repeatedly called for an expansion of the Groceries Adjudicator’s power to cover all dairy producers and not just the small minority on retailer aligned contracts.

“At present, retailer aligned contracts only account for about four percent of the milk produced in Wales and, as such, the majority of dairy producers are not covered by the remit of the Adjudicator.

“We would like to see a system whereby the dairy code is properly policed so that we can tell straightaway if the purchasers are cherry-picking and if they are not playing fair,” added Mr Owen.

[caption id="attachment_6345" align="alignleft" width="143"] FUW Senior Policy Officer Dr Hazel Wright launches the Union's dairy report[/caption]

A report on the current state of the Welsh dairy sector has been launched by the Farmers’ Union of Wales in order to identify the main issues affecting the sector and those mechanisms which might mitigate some current problems.

The FUW’s Milk and Dairy Produce Committee Chairman, Rhydian Owen, said: “ The Welsh dairy industry continues to reel under months of continuing low prices and poor profitability and almost half of dairy farmers in Britain have stated an intention to quit the sector.

“The FUW is extremely concerned that any sign of a price recovery may still be some way into the future due to a continuing global supply and demand imbalance.

“We have now sent a synopsis of the main issues contributing to the current dairy sector crisis to local MPs, MEPs and will be distributing this information further to the newly elected Welsh Assembly members.”

The report highlights that a year after milk quotas have been abolished, and in the absence of any observable or predicted changes to current global supply and demand dynamics, it is imperative that the milk market is managed in a manner which stabilises prices.

“The market has to be managed in a way that ensures a fair standard of living, protects producers from the effects of unfair practises and strengthens their position in the supply chain.

“Furthermore, the on-going Russian trade embargo, coupled with reduced demand in China and a weak economic environment will likely delay price rises beyond any potential downturn in production,” added Mr Owen.

The report further concludes that measures which enhance the sustainability and viability of the Welsh dairy sector will therefore be essential to ensure future competitiveness and innovation.

FUW Senior Policy Officer Dr Hazel Wright said: “The FUW Policy Department continues to work with the Union’s Milk and Dairy Produce Committee to fight for the prosperity of Welsh dairy farmers.

”In order to preserve the future of Welsh and British dairy farmers, it will be crucial to ensure that resilience does not merely focus on producing milk at lower prices, but instead recognises the need to intervene in a way which mitigates the wealth of issues which remain out of the control of the primary producer.”

FUW report into the post-quota dairy sector April 2016

[caption id="attachment_6341" align="alignleft" width="300"] US Counselor for Agricultural Affairs Stan Phillips received a copy of "A Family Affair” from FUW President Glyn Roberts[/caption]

Farmers’ Union of Wales officials recently met with the United States Department of Agriculture to discuss the future of the Welsh agricultural industry.

Welcoming the United States Department of Agriculture representatives Stan Phillips, Counselor for Agricultural Affairs and Steve Knight, Agricultural Specialist, were FUW President Glyn Roberts, the Union’s Managing Director Alan Davies and Senior Policy Officer Hazel Wright.

“We welcomed the opportunity to provide an insight into Wales’ current political, economic and social situation and share information on the Welsh farming sectors, its geography and the current incomes and exports arrangements with the US Department of Agriculture,” said Glyn Roberts following the meeting.

“Sharing experiences and information with our US colleagues is vital in the process of establishing an export market for our Welsh Lamb and Beef,” he added.

The FUW was keen to use the opportunity to promote the high quality of Welsh agricultural produce and the high environmental and welfare standards that producers adhere to.

[caption id="attachment_6342" align="alignright" width="300"] US Agricultural Specialist Steve Knight, US Counselor for Agricultural Affairs Stan Phillips, FUW Senior Policy Officer Hazel Wright and FUW President Glyn Roberts[/caption]

“We highlighted the strong export relationship we have with the European market today by explaining that the market for Welsh red meat in Europe is worth close to £200 million a year and accounts for 90% of Welsh agricultural exports.

“In 2014, export figures show that approximately 35% of sheep meat produced in Wales was exported to the European Union with 93% of Welsh lamb exports, 93% of Welsh beef exports and 98% of dairy exports destined for EU countries,” said Mr Roberts .

Given the ongoing Transatlantic Trade Investment Partnership developments between the EU and the US, the FUW was also keen to discuss the use of equivalencies in regulation, the protection of PGI Welsh lamb and the move towards better and more accurate food labelling.

“The FUW was pleased to hear that significant progress has been made on Welsh beef and lambs exports into the US and we will be interested to see how this market develops in the future”, added Mr Roberts.