How Covid-19 Is Affecting Farmers

Farmers recognised as key workers

Farmers have been recognised by the Government as ‘key workers’ producing food and other necessary goods, meaning they can continue to go about their essential work in relation to producing food.
The category includes those involved in food production, processing, distribution, sale and delivery, as well as those essential to the provision of other key goods (for example hygienic and veterinary medicines).

The inclusion of farmers allows them to continue to undertake all actions necessary for the running of their businesses which they cannot undertake from home, and the FUW has made it clear to the authorities that this includes the movement of animals and feed - actions which are essential for food production and carry with them minimum risks in terms of coronavirus provided appropriate biosecurity measures are followed.

To date, the advice has focussed on the provision of schooling for key workers. However, further guidance is expected over the coming days, and the FUW has emphasised the need to ensure workers such as agricultural mechanics and contractors can continue to work to keep farm businesses running.

Shearing concerns

There are significant concerns regarding the upcoming shearing season given the nature of the work and also the normal reliance on shearing teams from abroad.

The British Wool Marketing Board are currently working with the National Association of Agricultural Contractors (NAAC) which will host a shearing jobs page on their website with a list of shearing contractors looking to fill shearing gangs, and a list of shearers able/willing to assist this year. The NAAC is also working on Coronavirus guidance for shearers.

Seismic shift in supply chains and buying patterns

The pandemic has meant a seismic shift in supply chains and buying patterns as supplies into the food service sector - an important, often high end market for both dairy and red meat - initially slowed then abruptly stopped, including in terms of supplies to schools and universities.

Meanwhile, consumer buying has necessarily shifted to the supermarkets and other food outlets, coupled with which panic-buying has led to significant temporary shortages of some products..

Impact on milk market

As a result, the milk sector has seen acute volatility, especially given the growth in recent years of the popularity of coffee shops and the numbers of farmers supplying directly into the food service sector.
As a result, large numbers of suppliers have been notified of significant price drops and other changes such as the deferment of monthly payments, with Freshways leading the way by announcing they were using Force Majeure provisions to justify a 2ppl drop in prices, down to 24ppl, from 29th March, and that payments will be deferred by a month, meaning March deliveries would not be paid for until mid may.

Acute impact on lamb prices

Over many months high demand for lamb in the food service sector both in the UK and on the continent has given a welcome boost to prices, so the closure of such outlets had an acute impact: Between the 20th and the 23rd of March SQQ average lamb prices fell by 60p/kg, or 25%, from 249p/kg to 189p/kg.
In addition, the ban on social gatherings is likely to impact on the traditional boost for lamb sales ahead of Ramadan (which is this year from 23rd April to 23rd May).

The loss of the service sector is also causing a huge impact for the beef market as for lamb, while panic buying in the supermarkets has led to an increased demand for mince rather than better cuts such as roasting joints at a time when a replacement market for such cuts is desperately needed.
The net impact to date has been a significant increase in demand for mince, driven by the supermarkets, which is significantly devaluing prime cuts and reducing carcass balance.
The loss of hide exports is also likely to have a significant impact, especially since large numbers of hides are normally exported to Italy.
The FUW has written to the UK and Welsh Governments calling for intervention where prices fall significantlyIn, and has written to the banks and supermarkets highlighting the need to support Welsh producers.

Competition laws relaxed
The UK Government has announced the relaxation of competition laws to allow supermarkets to work together to ensure food supplies reach consumers.
The change includes allowing supermarkets to share data regarding stock, share distribution depots and delivery vans and pool staff to meet demand.

Government support for self-employed individuals

The Government today has announced a package of support for self-employed individuals, saying those deemed to be eligible based on existing information will be contacted by HMRC.

Self-employed people will be able to apply for a grant worth 80% of their average monthly profits over the last three years, up to £2,500 a month. However, at least half their income must have come from self-employment as registered on the 2018-19 tax return filed in January - and anyone who missed the filing deadline has four weeks from now to get it done and still qualify.
The scheme is open to those who earn under £50,000 a year, and unlike the employee scheme, the self-employed can continue to work as they receive support.
The first backdated payments will be made in June direct to bank accounts, and will be taxable.

Livestock to markets work to stay open

Over the past fortnight the FUW has been in regular talks with auctioneers and representatives of the Livestock Auctioneers Association about the importance of keeping livestock markets open, with the issue one of many raised in correspondence to the UK and Welsh Governments.

Despite some market closures triggering rumors a blanket closure had come into force, this was not the case - some closed due to the collapse in the lamb price and other problems such as staff being uncomfortable working or in self-isolation, and it is hoped any markets closures will be temporary.

Strict biosecurity measures have been introduced in markets to reduce risks, with farmers being required to deliver stock to markets and then leave, and only buyers being allowed to attend auctions while complying with social distancing and other rules. However, what is being sold is restricted given the need to restrict buyer numbers, so for example no breeding stock or couples sales are being held.

TB testing

Major concerns exist in terms of the impact of the coronavirus on TB testing. These concerns relate to the possible shortages of vets due to their own circumstances or scheduled tests being inappropriate due to the risk to farmers and vets alike.

The impacts relate not only to annual surveillance testing and contiguous testing but also to pre-movement testing requirements at a time when many need to move animals to other land.

Over the past fortnight the FUW has discussed the possible impacts of the coronavirus with the Office of the Chief Veterinary Officer (OCVO) and Rural Payments Wales (RPW), and assurances have been provided that where testing windows are missed due to the virus penalties will not be applied.

The best current advice is available under the covid-19 banner on the TB Hub website. The FUW is in ongoing talks with the OCVO and will provide further updates in due course.

Access to land

The vast increase in visitor numbers to the countryside using public Rights of Way over the weekend of the 21st and 22nd of March raised major concerns within rural and farming communities as well as for bodies such as the National Parks and Natural Resources Wales.

While the Government’s ‘lockdown’ has since tempered concerns, some Rights of Way close, especially those close to urban areas, continue to see significant use by the public, raising concerns regarding the numbers touching styles, gates etc. which are subsequently used by others using such access, including farmers going about their daily business.

This is a particular concern for members where paths and bridleways lead through farmyards or close to farmhouses.

On Monday 23rd March, the FUW asked the Government to review policies in terms of access to the countryside and the advice given to those using rights, and on the 25th March Welsh Government introduced emergency legislation that requires local authorities, NRW and National Parks to carry out the immediate closure of rights of way and access land where it is considered that access is liable to large numbers of people congregating or being in close proximity to each other, or where there is otherwise a high risk in terms of spreading the coronavirus.

This does not represent a blanket closure of the Rights of Way network and Welsh Government is currently working on amendments to the initial legislation.

There are mixed feelings about whether a blanket closure of Rights of Way should be introduced, since closing all routes may simply lead to people taking exercise by trespassing, leading to other problems and a situation where there is no certainty as to where people have been walking, touching gates etc.

CAP Schemes and related issues

Single Application Form completion process

The FUW requested an emergency stakeholder meeting with Rural Payments Wales some weeks ago in anticipation of the problems now faced, and held numerous internal meetings. As a result, assistance with the completion of all SAF forms is being carried out by FUW staff over the telephone, and changes have been made to the RPW Online website to allow FUW staff to submit forms for members.

The FUW has also asked that Force Majeure/exceptional circumstances rules be fully recognised by Welsh Government to take account of any mistakes that result because of these unique circumstances, and that the May 15th submission deadline be extended by at least a month.

Welsh Government has responded favourably to these requests and a Ministerial announcement on this and other matters was expected on Tuesday or Wednesday but has now been delayed.

Outstanding payments and other issues

Given the current pressures on members’ finances as a result in falls in farmgate prices and other issues, significant concerns exist in relation to those who have not been paid their BPS or Glastir payments (either in part or in full), as well as issues relating to outstanding inspection reports (which will delay SAF completion), and the fact that England has announced a blanket derogation to the ‘three crop rule’ but Wales has not.

The FUW has urged the Welsh Government to issue outstanding payments as soon as possible and to introduce exemptions to rules and deadlines to take account of current pressures and circumstances.

Fallen stock collection

Amongst the long list of issues raised with Welsh Government and others in almost daily teleconferences over recent weeks is the possible impact of the coronavirus on fallen stock collection.

Fallen stock collectors are deemed to have key worker status and can therefore carry on collecting fallen stock - but obviously all human (as well as animal) biosecurity measures should be observed by collectors and those they are collecting from.
Concerns have been expressed that the travel ban and other issues will have a severe impact on the tallow market - and with tallow being a byproduct of fallen stock rendering, this could make fallen stock collection impossible.
However, as renderers also collect cooking oil and similar byproducts from the food service sector, the closure of restaurants etc. could help counter any such impacts.
The FUW continues to monitor the situation through its contacts with the National Fallen Stock Company and the authorities, but continues to hold the long-established view that traditional livestock farmers should be entitled to bury fallen stock provided this can be done safely, as was the case until 2004.