The many challenges of tillage farming

An unlevel playing field was the theme of a recent ITLUS conference where Stephen Collins of Mogeely in Cork outlined what many tillage farmers feel about how the sector has been treated in recent years. This feeling is exacerbated by:

In his opening remarks, Stephen commented that the current low grain price levels are not sustainable for producers. While acknowledging that the €130/t paid by most merchants in 2016 was better than might reasonably have been expected from the market, it is still much too low relative to the escalation in production costs.

Teagasc estimates a production cost of €126/t for winter barley (based on 9t/ha) and €123/t for spring barley (7.5t/ha). These numbers will be even higher when fixed costs, land rental cost and some level of return on the farmer’s labour are included.

And while growers must be eternal optimists, there is still little point in continuing to run a high-cost business with little or no return indefinitely. Something must change, or else.

Greening grievances

With 87% of our agricultural countryside in grassland, Stephen asked why further greening is required.

While one must acknowledge the payments involved and the benefit of rotations, the obligatory percentages add costs to farms with more than 30ha of arable. Indeed, possibly even more so to farms with just over 10ha of crops.

He asked why it is only tillage farmers who must incur additional costs and inconveniences to comply with the requirements of greening.

As well as the three-crop rule, meeting the 5% ecological focus area (EFA) requirement is another obligation. While the Department and Teagasc did very well to make the system workable at farm level, it is still a great concern for any grower looking at a hedge and wondering if there is sufficient wood in it to qualify when one is very close to the 5% EFA threshold.

EFAs apply to all farmers with more than 15ha of arable and we are told that the 5% threshold could rise to 7%.

However, while there was talk that this could rise to 7% EFA for 2017, this is definitely not the case. For 2017, the 5% rate will continue to apply.

However, a failure to comply with all the greening regulations, including the number of crops grown, will result in actual penalties on the basic payment itself in 2017 and beyond.

The introduction of penalties for noncompliance in 2017 will force growers to think twice about what the correct approach for them to take will be.

If one was to ignore some or all of the greening obligations, then a penalty will apply, as well as the lost payment, and this gets more serious when subsequent penalties are subject to a multiplier.

Stephen stated that this one-size-fits-all approach to the regulation is not practical. “Just look at the natural diversity of the Irish countryside,” he added.

He again asked why tillage is the only sector that is inconvenienced by greening obligations to secure payments, given that the sector only uses less than 10% of the land.

Nitrates

Stephen also commented on the challenges to farming created by the nitrates obligations. The requirement to establish a crop within six weeks of ploughing or spraying-off may be desirable for the environment, but it adds fear for farmers who plough or spray ahead of planting. If the weather turns and a crop cannot be established, then there is a fear of penalties.

Stephen suggested that many farmers are now reluctant to plough early due to these regulations and this may be leading to other problems such as the increased incidence of BYDV. He recalled the need for a six-week period post-ploughing, prior to planting, to eliminate the risk of aphid survival and virus transfer.

Stephen asked if the move to ploughing ahead of planting is contributing to the increased virus issues seen in recent years. And is this green bridge a contributing factor in the need for aphicide use and in the build-up of resistance?

Imported grain

Asking about the controls on imported grain, Stephen stated that, as Irish growers, we are prohibited from using municipal sludge by our assurance scheme, yet imported grain can be treated with sludge. “Why the difference?” he asked. Treated municipal sludge represents a cheap source of organic fertiliser for growers here, he added.

He also said that it is very unfair that pesticides withdrawn from use in the EU can be applied to crops in other countries and that grain can be imported into the EU. This represents double standards and tillage farmers are again the ones that must suffer.

There is a very strict policy on the availability and use of pesticides in the EU. He fully accepts that products found to be unsafe should not be used, but whose is the obligation to find a safer preplacement before it is withdrawn from the market? In this regard, he stated that it is increasingly frustrating that product withdrawal decisions now appear to be more political than science-based.

He called on livestock farmers to demand higher inclusion rates of native grain in rations, stating that it was the only way to realistically preserve the Irish credentials of our exports.

Policy weaknesses

Stephen asked why policy is so slow to deliver options for tillage compared with other sectors. This might be somewhat acceptable if there was no competition for resources between sectors, but there is. And when one sector is being aided by financial support, this is being actively used to disadvantage other sectors.

From a political and policy perspective, he questioned why it took so long to deliver a knowledge transfer scheme for tillage farmers compared with other sectors.

He commented on how quickly action can be taken for other sectors compared with tillage. He asked why, after all this time, the TAMS for tillage scheme has not been introduced. And why did it take so long to introduce partnerships for tillage farmers compared with the other sectors.

In conclusion, he said that tillage is a very important sector which delivers high-quality grain and straw to the livestock sector. This provides other businesses with the option to assure the provenance of their products, which, we are told, is important for exports.

Tillage provides land for the spreading of manures from the intensive livestock sector and this is set to become increasingly important in the future.

However, if the sector is not fairly treated by the industry as a whole, then tillage farmers cannot secure their livelihoods into the future. If this situation persists, many will not be there in a few years’ time and its value to the industry will only be clearly seen and acknowledged if it disappears.

Panel discussion

Cheap grain is bad news for Ireland

A very useful panel discussion followed, which included contributions from Bill Callanan from the Department of Agriculture, Phelim Dolan from Comex McKinnon, managing director of Brett Brothers Ltd Jimmy Brett and IFA grain chair Liam Dunne.

There was general agreement that cheap grain is generally bad news for Ireland as it erodes the competitive advantage of grazed grass. And while feed is a major cost element for pig and poultry producers, the balance between feed cost and meat value tends to equalise over time in these sectors. But there will always be periods of win and lose due to price imbalances, whether grain prices are high or low.

However, low prices have a big impact on the economics of tillage, as much of our grain is being produced at below cost. However, it was suggested that the EU policy of cheap safe food, with big associated costs, is also causing considerable difficulties.

There is no denying that huge global grain stocks are acting to depress prices. Growers everywhere are reluctant to cut production in response to over-supply and this too is affecting future prospects. Supply will remain excessive unless production is decreased or demand increases significantly.

On the issue of chemicals and politics, it was stated that the official Irish attitude is to be led by the science. If something is not safe, or is found not to be safe, then it should not be used.

Imported problems

On the issue of grain and straw imports, most felt that it was wrong that any product could be imported that would jeopardise the viability of a native industry. And that applies whether it is from inside or outside the EU.

Specific reference was made to the importation of grain and straw containing blackgrass. It was stated that such action would not be allowed in an equivalent issue in the livestock sector.

Reference was made to the fact that far more controls apply to timber packaging within the EU and there are huge protections at EU boundaries to help protect this sector from the unintentional entry of invasive species.

Grain-related imports must be checked and controlled. A national interest is at stake and Liam Dunne said the IFA is demanding that all grain imports be screened in advance of loading to remove such risks. Feed and grain imports are necessary, but they must be controlled.

Straw imports are a different problem, but a similar issue. Straw coming on to this island from Britain carries a real risk of carrying undesirable weeds such as blackgrass and is therefore a threat to the tillage sector here. This must be monitored at official level.

Greening matters

On the issue of EFA changes, Liam Dunne said it was still possible that the EFA requirement could be increased to 7% in future.

He also said that the use of protein crops as an EFA measure might discontinue in 2018, as the commission aims to prevent the use of pesticide on land designated as EFA.

Liam said that grass margins around tillage fields may be added as an EFA measure, with a multiplier of nine. This will be welcomed by those who acknowledge that their headlands have not been performing to the same level as the body of fields and this would help to rise overall farm yield averages.

Grass margins could be used to help improve soil structure in this part of fields where it is subject to most damage. Such areas could come back into production when ready.

Native grain

There have been many calls for Bord Bia to promote native grain use in livestock products that claim to be Irish and carry an Origin Green compliance.

While growers would see such a move as favourable, some of the panel felt that such an initiative will be difficult. Some panellists felt that most buyers of feed buy purely on price.

Jimmy Brett said that Brett Brothers has a 43% native grain inclusion rate in its rations, but it has been very difficult to get it above that level.

The big question is, what is Irish and what is being Irish worth in the marketplace? Regardless of a feed premium, what is the potential downside associated with selling livestock and other products as Irish that have been fed with ingredients that have come from the other side of the world?

A follow-on from this point asked about the possibility of creating a premium feed scheme for native ingredients. It was stated that the tillage sector supplies much more feeds than just grains (via rations) to the livestock sectors.

It was suggested that this total is more than 6m tonnes of feeds from tillage, as it includes wholecrop, crimped grains, fodder beet, maize silage, etc, and the question is how should these be handled within a premium feed scheme.