Northern Irelands Farmers will have been pleased to receive the lion’s share of their single farm payment in recent days. The weakness of sterling following the Brexit vote has added a very welcome £40 million to this year’s payout. A further benefit will be recovered from the increased competitiveness of our food exports in those all-important export markets.
This has been very positive for our grain producers, collecting an enhanced single farm payment and also enjoying a £20 to £25/tonne uplift in grain prices purely driven by exchange rates.
For our livestock sector however there is a sting in the tail - with well over 2 million tonnes of feed materials to be imported from Europe, South America and the USA - we will suffer from the rapidly falling exchange rate against euro and dollar. The 15% reduction in the value of sterling will add £75 million to the provinces annual feed bill when the full effect has filtered through.
Our local European issues are only part of the story of course – in the wider world, markets are moving in response to the normal trade issues of supply and demand, weather patterns and money movements. The concerns about the La Nina weather pattern causing dryness in Argentina is creating some doubts on the supply side and funds looking for somewhere to invest their $millions have moved back into agri commodities. Funds reportedly moved from a position of 50 million tonnes short in grains to 25 million tonne short over a 3 week period. The buying spree spilled over into the soya markets and in spite of strong supply signals the markets responded with soya meal in Chicago moving from under $295 per tonne to $328 in a few days. Most of this gain has been given up again and the markets settled back in recent days as the funds became sellers – offloading substantial tonnages of corn and soya. Volatility is a big feature and markets are sensitive to money movements but fundamentally not much has changed with little activity in terms of physical trade. Generally prices have come off the bottom reached in mid-October with all commodities trading a little stronger and buyers are struggling to find where the value is. Sterling buyers have the added concern about currency and where the current slide will end.
It is inevitable that currency driven inflation will affect most farm inputs and indeed the wider economy. This cost pressure makes it critical that product prices quickly reflect the increased value of our exported milk and meat. After a prolonged period of food deflation it is important that food retailers recognise the pressures in their supply chain and deliver more realistic farm prices. Current prices are not at a sustainable level and as farmer indebtedness to the banks has just crossed the 1 £billion level and with trade credit also running at record levels there are many businesses at breaking point.
- Category: Feed Forum
Attention to detail and sound advice are among the key ingredients of a successful dairy business today according to producer Seamus Lappin who farms near Armagh in Northern Ireland.
Contrary to many of the current trends, he also believes that small, efficient businesses can succeed and thrive in the current climate. Seamus runs a family dairy farm and has been working on the farm for some thirty years, starting as a teenager working alongside his father. He has a herd of around 65 Holstein dairy cows with another 40 or so followers. All his milk goes to Linwood, a local liquid milk processor based in Armagh.
“The size of the herd has hardly changed over the past thirty years,” he says, “But what has changed is the yields that we are achieving. Fifteen years ago we were getting around 5500 litres per cow per annum, while our current yield is 10,100 litres per cow per annum. We have been able to remain competitive by increasing our yields, and I believe that small, well-run businesses definitely have a role in the future.
“For me the biggest challenge – like every producer in the country – is the volatility of markets. The lack of stability and uncertainty over prices mean you can’t plan and it’s very difficult to make longer term investments.”
Important to the development of the business over the last 10 years or so has been the input from Feed Adviser, Paul Sloan who not only supplies much of the feed used on the farm, but is a useful source of technical support and a sounding board for ideas. Paul has been around the feed industry in the province for a number of years. After studying at university he spent some time beef farming in Canada and has since held various positions in the local feed trade before setting up his own business partnership in 2005.
He is also a member and keen supporter of the Feed Adviser Register (FAR), which was established in 2013 by the Agriculture Industries Confederation (AIC), NIGTA's affiliated organisation in GB. The Register provides a platform for professionals who have a proven record of competence in the field and delivers continual on-line training for those involved with giving livestock feed advice, as well as a new level of assurance for livestock producers.
Paul says that he doesn’t bring any easy answers to Seamus in terms of improving the business - it’s very much a partnership and it’s about a lot more than nutrition.
He says: “I like to take a holistic approach to the business, looking at overall cow management and cow comfort, all of which come together to achieve greater efficiency, sustainability and animal welfare, as well as increased productivity. The balance of the rations is obviously important, but I like to think that I bring a total package to Seamus and the other farmers that I advise.”
Together Seamus and Paul have worked on a number of improvements including housing to improve cow comfort and feed space; better laneways for cows walking out to grass; dry cow nutrition; winter rations; and calf vaccination. This has produced dividends in terms of the health of the animals.
Paul says: “When you put this together with reduced feed inputs and increased productivity you have a business that is sustainable in every sense of the word.”
Seamus agrees with Paul that it is the all-round approach that has led to the increase in production.
“It’s been mainly led by diet, better cow management, vaccination and overall improvements in the day-to-day running of the herd”, he says, “However, if I had to pick out one thing, it would be the changes we have made to dry cow nutrition. This has made a big difference to how the cows calve and reach their peak with very few issues. Anything which improves the health of the animals is good for cow welfare and productivity too.”
Paul recommended introducing more straw to the dry cow diet using the Keenan Klassik feeder which allows the straw to be chopped and presented consistently.
Both Seamus and Paul believe that measurement is a key component of management and improving performance on the farm. As well as the annual yield figures of 10,100 litres, the herd is currently producing 32.6 litres per cow at 3.8 per cent butterfat and 3.2% protein with cows in milk for an average 200 days.
Each cow is consuming 3100 kg of concentrates per year. However, grass is a key component of the system put in place by Seamus and Paul. Weather allowing, the cows are turned out around 17th March and they are currently taking 18 litres off grass and feeding to yield in the milking parlour at 0.45 kg per litre above 18 litres.
There is a paddock system in use on the farm and the forage quality is exceptional. Seamus has been gradually replacing his swards to ensure that this remains the case. Silage quality is also good with figures of around 25 per cent dry matter.
For Seamus measurement and benchmarking of his performance are important. As well as an annual assessment of his performance by the Department of Agriculture, Seamus has also benefitted from the monthly discussion groups run by the College of Agriculture Food and Rural Enterprise (CAFRE) from its Greenmount Campus. These are attended by around 20 local dairy farmers.
As part of the group, figures are collected monthly for comparison including milk production, feed rates, and milk from forage
“It gives me an idea of where I am compared to the rest of group,” says Seamus, “It stimulates interest and maybe even a bit of competition, and it helps the members to continually improve what we do. I find it really useful to have that kind of benchmark and to be able to compare what I’m achieving with other members of the group.”
Going forward Seamus is not necessarily looking for further improvements in yield volumes, but he would like to consolidate what they have done to date and improve solids and animal health traits.
Seamus is also a supporter of the Feed Adviser Register and believes that it gives livestock producers a degree of confidence in the quality of the advice they receive that did not exist before.
More information about the Feed Adviser Register can be found at www.feedadviserregister.org.uk or by contacting This email address is being protected from spambots. You need JavaScript enabled to view it.
- Category: Feed Forum
Feed materials are sharing in the general torpor of the global commodity markets as plentiful supply meets limited demand from consumers.
The bumper crops of the last couple of years are weighing on the market for cereal grains – prices are on the floor and while it’s too soon to make any forecast on the 2016 harvest a substantial stock carry over is inevitable. With spot prices so low, the London futures November wheat price looks attractive and new crop grain is set at a considerable premium to the spot market – this may tempt sellers to hold their grain. At this stage with strong plantings in the ground and no serious weather events anywhere in the world it’s hard to see that grain will be scarce in the foreseeable future and as buyers are reluctant to cover forward, it is very much a hand to mouth market.
The weakening of sterling driven by the uncertainty around the outcome of the Brexit vote is preventing UK buyers reaping the full benefit of these cheap grains.
Currency is also a major factor in the maize market with the big exporters such as Russia and Ukraine selling in a weak currency and marketing very competitively against the other origins. The removal of export taxes on corn by the new regime in Argentina is giving an advantage to growers in this region and they are currently the cheapest sellers on the world market. For local feed compounders maize continues to compete very successfully against wheat in ration formulations and is likely to be the first choice cereal for many diets for the foreseeable future.
On the protein side the soya harvest is underway in South America with Brazil about 2/3rd through its expected 100 million ton crop while Argentina is just getting underway with a 60 million ton harvest expected and a record line-up of vessels awaiting its arrival at the ports. These big crops will continue to pressurise the global markets and the US will be keen to recover some of the export tonnage lost to the South Americans. The gradual slide in soya prices which started with the big US harvest last year has taken nearly $100/ton off meal prices over the winter months and offers the best hope for any further feed price reductions for local farmers.
Other commodities are reflecting global demand as market opportunities arise. Soya Hulls have enjoyed a surge in price as drought in South Africa has created a substantial demand for high fibre feeds in that region. With Argentina the only source of this material they have made good use of a new customer prepared to pay considerably more than the Europeans. In contrast the Palm Kernel market has weakened as the New Zealand drought has eased and the dairy industry there has suffered heavily from the collapse in global milk prices.
One commodity which has maintained a relatively strong price is fertiliser with the reductions so far failing to reflect the major fall in energy costs. Local blenders and distributors have shared farmers’ frustrations as the major manufacturing companies have enjoyed a firm global demand for their product and the protection of the EU tariffs on imported material. The local merchant trade have the difficult and thankless job of distributing and financing the supply of this essential input to local farms.
- Category: Feed Forum
The global commodity market is no place for the faint hearted – as dramatic swings in the world financial indexes throw everything into a spin. The economic miracle that was China seems to have been derailed and the fall in demand from this region is being felt across a range of commodities. Crude oil tumbled from 51$ to 40$/barrel last week (losing 1/4 of its value) before recovering the losses and moving higher within a few days.
On the grain and feed material front, record yields and an uncertain demand are giving a very weak feel to the markets. The world is harvesting another big grain crop – with projections of a 17 million tonne wheat crop in the UK on top of a 3 million carry over. Ukraine has another big crop of maize to sell but the continuing unrest in this region (overshadowed in the news by immigration issues) makes it a high risk origin. The French maize crop however has suffered heavily from heat and drought through the midsummer and could lose up to 30% of its forecast yield. The combination of growers more inclined to put their crops into store than sell at prices below cost of production and purchasers afraid to buy in the expectation of reduced demand from the livestock sector is creating a distinct lack of confidence with little business getting done.
On the protein side the global soya crop looks good with a good harvest in Argentina but farmers again reluctant to sell. Elections in this region are due in October and with the possibility of a new government cutting export taxes growers will hold on to their crops in hope of better returns. A strong US dollar and significant global demand for soya will mean that protein will be the more expensive element in rations this winter.
BIG ISSUES
Locally feed materials are trading at the levels of 6 – 8 years ago and this is reflected in current feed prices with compounds around £50/tonne back on the peak in 2013. The big issues for the supply trade in Northern Ireland this winter is the level of demand which can be expected from a livestock sector which is clearly not profitable and the level of debt carried by the trade. Farmer debt to feed suppliers is currently running at around £150M with just under half of this figure owed by dairy farmers.
A week’s credit to the dairy sector is worth around £5M so any increase in the debtor days will create an increase in the working capital needed to fund the 50 or so feed businesses in N Ireland. Just like their farmer customers these businesses are in danger of running out of cash this winter.
Trade projections would indicate that feed costs at around 8.5p/litre this winter could account for 50% – 60% of the milk cheque. Careful budgeting and cash flow projections to predict the peak requirements for credit and an open and honest communication between farmer and feed supplier will be vital to avoid the risk of business failures this winter.
- Category: Feed Forum
The long running saga of the EU Commission’s struggle to deal effectively with approvals for the use of feed materials from new genetically modified crops has taken a new and potentially disastrous turn for European food and feed producers.
For many years new genetically modified crops and their derivatives from the world’s main food producing countries seeking entry into the European market have undergone a rigorous risk assessment by the European Food Standards Agency. They would then come before a standing committee for approval by the politicians. This approval was continually blocked however by a number of member states strongly opposed to genetic modification. A prolonged process of committee sittings led to a default position whereby the commission would bypass the politicians and issue a market authorisation based on the scientific evidence and EFSA approval.
The latest proposals to resolve the approvals logjam would give national governments the power to decide whether to issue the market authorisations and would allow individual Member States to take a non-GM stance with regard to the use of feed and food materials.
Far from providing a solution to the problem, the major EU feed and food organisations believe that it is a betrayal of the principle of the single market and predict that it will lead to chaos. They are mounting a concerted campaign to resist these proposals as they could significantly impact the Internal Market for food and feed products, potentially causing disruption to trade, transport, processing and production with lower investment and higher costs in “opt-out” countries.
With the EU dependent on importing over 70% of its animal feed – in particular protein-rich materials which cannot be produced in Europe for climatic and agronomic reasons it is viewed by feed producers as not just an attack on free trade but on the intensive farming sector in particular.
Consequently, the EU food and feed chain partners are urging the European Parliament and Council to reject the Commission’s proposal. They argue that it should be the main priority of the commission to ensure that the current legislation is properly implemented instead of trying to change the present market authorisation procedure for political considerations.
The European Commission adopted the legislative proposal on April 22nd and it will now be transferred to European Parliament and Council for discussion and adoption. The Northern Ireland Grain Trade Association is actively supporting the European Food and Feed Associations by lobbying relevant government departments and local MEPs.
Feed Prices Ease
The continued weakness in the global grain markets is expected to be reflected in local feed prices in the coming weeks. Protein prices remain firm however and while soya prices faltered a little with the expectation of good crops in South America the mid protein materials such as rapeseed and the corn by products are still relatively expensive.
- Category: Feed Forum
World protein prices are being driven up rapidly as the financial fund buyers have surged back into the commodity markets. Funds moved from near record short to near record long positions in 4 to 5 weeks following the recent United States Department of Agriculture (USDA) report.
Soya is leading the charge as the USDA reduced its forecast for Argentina’s soyabean crop by 2.5m tonnes to 56.5m tonnes, contributing to a drop in global production. Meanwhile China, the world’s biggest soyabean consumer, is set to import a record 87m tonnes of soyabeans in the coming year, up 4m annually, largely to feed its growing livestock and poultry sector.
Contracts for July soybeans rose by the maximum daily limit of 65 cents, or 6.3 per cent in Chicago trading on the back of the new USDA estimates of grain supply and demand for the coming season. These reports are closely followed by the trade and have a big influence on the market sentiment. The price for nearby soyabean meal futures was also strong – hitting the highest level since September 2014 while other commodities were pulled along in its wake.
This is the first report since dry weather in Brazil and flooding in Argentina damaged the soyabean and corn crops under cultivation in South America and restored volatility to grain markets. Predictions are that customers will turn to the US to source beans and revitalize the export trade which had been hurt by the strong dollar in recent months. Weather concerns are also keeping an edge to the market in this region however amid fears of a La Nina weather event which would increase the possibility of hot and dry weather during the critical flowering stage of the current US crop and potentially impact yields in South Amrecia next spring.
The outlook for grain remains bearish as bumper crops of maize and wheat are predicted as spring growing conditions are favorable in most of the key exporting regions. In spite of the likelihood of record global grain stocks the Chicago futures posted higher prices for both wheat and maize.
The implications for global protein prices are alarming as the other principle proteins such as rapemeal are being forced higher as buyers look for alternatives. In reality there is no substitute for soya in many diets and it highlights the vulnerability of our local livestock sector. Pig and poultry producers are dependent on these imports from North and South America to maintain productivity and are at the mercy of one of the world’s most volatile supply chains.
- Category: Feed Forum
Farm commissioner Phil Hogan has declared his commitment to reducing the red tape which is slowly enveloping agriculture in the EU. This will be warmly welcomed by every farmer and every business in the agrifood sector as we face a steady stream of regulation from Brussels. Much of the Brussels output is based on genuine concerns around food safety, the environment and issues which can have positive outcomes for farmers and consumers.
An example of a proposal which has no such redeeming features is the regulation which would permit regions within the EU to ban the use of Genetically Modified food and feed materials. This proposal threatens the supply of soya and other essential proteins into the EU and would be disastrous for the livestock sector. It seems to be meeting opposition on all fronts, however, as the European Parliament's plenary session has rejected the Commission's proposal. This follows earlier defeats for the proposals at the EU Agriculture committee and at the Environment committee. A call for a moratorium on new GM authorisations was also rejected while the parliament voted in favour of an amendment calling on the Commission to submit a new proposal.
Charging for Regulation - Progress is being made on the proposal on official controls which aims to shift all the cost of regulation in the agrifood sector on to the businesses involved. This would add substantial cost into the food chain as every inspection made and sample analysed would be charged to the business. The Council of the European Union has reached a compromise position on the key issues of charging and competency of controls staff and it appears that there will be no requirement to extend mandatory charges to the feed sector. UK negotiators claim to have successfully delivered greater flexibility in key areas and fought off increasing prescription, supporting their aims of smarter, more efficient controls
Medicated Feed Proposals - These proposals threaten to bring an end to the practice of administering medicines to livestock through feed. The EU Parliament has decided that the Medicated Feed file overlaps with another piece of legislation, the Veterinary Medicinal Product regulations, and therefore they will be treated in tandem. The timescale of both the VMP file and the medicated feed file has subsequently slipped back in committee, and will not be voted until mid February. The feed trade have briefed MEP’s on the various proposals and amendments in the hope that a workable solution can be achieved.
Dairy Intervention - One very positive measure which would earn many friends for Mr Hogan in this part of the world would be the introduction of an effective intervention scheme for dairy products. The commissioner seems determined to resist this one as local milk producers continue to face a bleak winter with milk prices well below the cost of production.
- Category: Feed Forum
As a new harvest gets under way growers have been issued with guidance on the use of the passport system for the sale of grain under the Northern Ireland Farm Quality Assured Cereals Scheme (NIFQACS).
A valid passport must accompany each delivery of cereal to the end user – be it farmer, merchant or feed miller. Coloured stickers applied to the passport are used to indicate the year of harvest and blue stickers have been issued to scheme members to identify the 2015 crop.
Purchasers of grain must ensure that the appropriate stickers are applied to the passport presented with each consignment and they are also required to record an individual identification number for the trailer used for delivery as well as the vehicle registration. Feed producers or merchants operating under the Universal Feed Assurance Scheme (UFAS) will be required to retain this information for inspection at their annual audit.
The assured cereals scheme is an important element in the network of schemes which help ensure the safety and integrity of the entire food chain. It is a code of practice which covers the crop -through growing, harvest and storage and is designed to manage the principle risks to the quality of the grain.
Particular emphasis is placed on the control of diseases in the crop which result in the production of mycotoxins. These toxins are harmful to animals and have the potential to cause contamination incidents in the human food chain. A copy of the HGCA guide to minimise the risk of Fusarium Mycotoxins has been issued to all scheme members. This details management practices and techniques for the control of the fungal diseases which are the precursors of mycotoxins.
Safe and secure storage, effective pest controls including a plan for the elimination of birds and rodents are all part of the strategy to produce grain fit to enter the food chain.
The scheme is administered by Northern Ireland Food Chain Certification and further details are available from NIFCC, Lissue House, 31 Ballinderry Road, Lisburn, BT28 2SL - Tel. 028 9263 3017
- Category: Feed Forum
The European Commission’s proposal for new regulations on medicated feed will have significant implications for farmers, vets and feed businesses.
While incorporation in feed is accepted as one of the most effective ways of administering veterinary medicines to animals, the commission has concerns that its improper use could in some way contribute to antibiotic resistance in the human population. Their aim is to reduce the use of antimicrobials in livestock production and to enforce a highly disciplined approach to the use of medicines in feed.
The veterinarian is the key player in the new proposals. Medicated feed can only be produced and supplied after an examination, diagnosis and treatment prescription by the veterinarian responsible for the animals. A point of particular concern to the livestock industry is that the use of antibiotics to routinely prevent disease will not be permitted and it is only when clinical disease has been diagnosed that medicines can be administered via feed. This has potential to increase the sub-clinical disease challenge and subsequently have a negative impact on animal health and performance.
While the practice of medicating feed is most commonly associated with pig production there is widespread use of prescription coccidiostats in the ruminant sector particularly in sheep and in young cattle. The requirement for a veterinarian to visit and make a diagnosis before animals can be treated will add significant cost and potentially loss of thrive if it causes a delay in the treatment of affected animals.
Feed producers are concerned at the proposals, specifically relating to the production of feeds and the tight restrictions placed on scheduling of production etc. For many businesses the cost of meeting these requirements along with the cost of additional laboratory analysis and the risk of penalties for non compliance may mean that fewer businesses will be prepared to add medications to feed and could lead to less choice for farmers.
As proposals have not yet been finalized, feed producers across Europe are working hard to influence the outcome in the hope of a solution which will allow mills to continue to provide this valuable service to livestock farmers. However the commission will no doubt be influenced by countries such as Germany, Denmark and Belgium which have already removed or significantly reduced in-feed medications.
- Category: Feed Forum
A couple of weeks can make a big difference to global commodity markets and the predictions of a record soya crop in South America reported in this column last month have been shot down in flames. The run of record large soybean crops in this region has now come to a screeching halt as weather has played havoc with the harvest and with the movement of the crop to the ports.
The Brazilian soybean crop had problems from the beginning of the growing season, so it was no surprise that the early estimates have been trimmed as the harvest progressed. The crop is now ending on a poor note due to dryness in North Eastern Brazil and wetness in far southern Brazil.
The big surprise has been the terrible end to the growing season in Argentina. Up until a few weeks ago Argentinean farmers had been expecting a record soybean harvest. The weather during the entire 2015/16 growing season was nearly ideal but as the crop was approaching maturity the rain started to fall and continued falling for several weeks. As a result, widespread areas in eastern and northern Argentina experienced extensive flooding with as much as 60% of the farmland under water. This region of Argentina is very flat with almost no slope to the land, so flood waters recede very slowly and the concern is that some soybean fields will be a complete loss due to beans sprouting and moulds developing in the crop. Even if the field is not flooded continuous wet weather can have a devastating impact on the crop resulting in shrunken, lightweight beans. The crop is now forecast to be down around 8% on the 2105 harvest with the hardest hit areas down by up to 30%.
The harvest in Argentina has basically been paralyzed for three weeks due to the wet weather. In a recent estimate, the Buenos Aires Grain Exchange estimates the soybean harvest at 16% complete compared to 46% harvested at the same point last year. This marks the slowest soybean harvest in Argentina in at least a decade.
This has played havoc with shipping programs as vessels queue in the River Plate awaiting the arrival of the crop at the ports as lorries struggle through a flooded and damaged road system.
The impact of these delays has been to drive up prices in the consuming countries with soya meal on the local spot market up by £40 to £50 per tonne in the last three weeks or so. Hopefully this is a reaction to concerns about supplies in the short term and there will be some correction as weather improves and shipments catch up with demand. However with global production forecasts now trimmed by 5M tonnes the expected reduction in stocks is bound to bring some firmness to a market which has been in a steady decline for the last year or so.
- Category: Feed Forum
The decision of the Assembly Environmental Minister to ban the cultivation of genetically modified crops in the Province doesn’t have any immediate impact on local farmers - but it does deny our growers access to technologies which are accepted as standard in the main food producing countries of the world and it is a further indication of a “sentiment over science” approach which could lead to major issues for livestock production in Europe..
With 90% of the feed materials used in Northern Ireland arriving by ship the provinces livestock sector is totally reliant on the global grain market.
Over 2 million tonnes of feed materials enter the province each year from all corners of the globe and much of this material is derived from genetically modified crops grown in other countries. All of this material has undergone a rigorous risk assessment by the European Food Standards Authority (EFSA) and has been approved for use in food and feed production within the EU
The EU Commission is currently debating a proposal which will allow each region within the EU to decide whether to permit the use of G M materials for food and feed in their country under “compelling grounds of public interest”. The reason cannot be scientific as the EFSA have already deemed them to be safe.
EU feed and food business operators act in a global commodity market, where GM technology is a given and this proposal could jeopardise the future of EU livestock farming. With 80% of feed produced containing some GM material all Member States are strongly reliant on GM imports for the viability of their livestock industry. The EU cannot replace the 32 million tonnes of imported soybean products which are derived from GM crops. Maize and maize by-products from the starch and ethanol industries would also be affected.The feed industry already offers non-GM feed supply chains for customers who are willing to pay the premium for segregation and identity preservation; therefore, there should be no need for any interference by policy-makers to prohibit GM raw materials, as market solutions already exist.
The distortion of trade which would result from some regions regulating against the use of GM would drive up prices and cause chaos throughout the EU agrifood sector. It would end the free trade throughout Europe and result in food shortages and imports of livestock products from third countries (where they would almost certainly have been fed on GM materials). Farming organisations and trade bodies across the EU are vigorously opposing the proposals – concerned about the logistics and labelling issues and the potential for massive distortion of trade.
Since Implementation will be a devolved issue there is potential for disruption of trade even within the British Isles with England, Scotland, Northern Ireland and Southern Ireland all making their own decisions.
- Category: Feed Forum
Quality Assurance, Safety And Customer Requirements Were the Subjects at New Trade Awareness Course
A new course aimed at promoting a better understanding of the province's agrifood sector has been fully subscribed for its first event. Developed by the Northern Ireland Grain Trade Association the “Trade Awareness” course is designed particularly for new entrants to the animal feed trade and focuses on the role of businesses which supply feeds to local farmers.
The program of visits and presentations was centred on the Belfast Harbour area and featured an overview of the agri food sector – its focus on export markets and the importance of assurance systems to deliver a high level of safety and quality right along the food chain.
Joe O’ Neil, commercial manager of the Belfast Harbour outlined the vital role of imports with over two million tonnes of feed materials landed at the port every year. The challenge of sourcing materials in the global commodity markets in the face of volatility caused by weather, currency movements, wars and political instability was discussed in detail
This was followed by a tour of the harbour stores and a visit to the MV Triton – a massive ocean going vessel just arrived from San Lorenzo in South America and laden with 45,000 tonnes of Soya Meal and Soya Hulls for local feed producers.
Compound feeds came under the spotlight at the United Feeds mill in the Harbour Estate with a tour of the production facility and presentations on quality systems and the world leading Food Fortress program developed in partnership with the Institute of Global Food Security at Queens University. Delegates traced the growth of the agrifood sector and the expansion of feed production as farms became larger and more intensive. As food production has become the mainstay of the local economy feed businesses have invested heavily in plant and equipment to increase capacity but also in staff training and in quality systems.
Research and development was another area where significant investments were being made to improve feed efficiency and reduce costs of production. This was highlighted in a partnership program with Devenish and Moy Park aimed at improving the performance and environmental impact of broiler chickens through precision nutrition.
Participants on the course were enthusiastic about its value in broadening their knowledge of the feed and food chain and it is anticipated that the event will be repeated later this summer.
NIGTA Trade Awareness Course June 2015
- Category: Feed Forum
The lengthening days, the end of the slurry spreading ban and dwindling feed stocks all point towards spring around the corner. A new season beckons and a time when a key consideration for many farmers is the purchase of fertiliser to kick start the new growth and drive maximum production from the land. Hopefully this purchase will be guided by soil analysis and a detailed fertiliser plan to ensure the best possible return from the investment in fertiliser. The selection of products with the balance of nutrients to complement the manures applied and to meet precisely the needs of the growing crop is essential and with timely application will ensure the best possible response.
The fertiliser purchase represents a significant blip in the cash flow of the farm business and often requires a degree of financial planning. Many farmers and fertiliser distributors will have watched the falling oil prices over recent months in the hope that fertiliser prices would reflect the global fall in energy costs. The reality is that the market for natural gas, which is the key component in nitrogen fertiliser production, has been much slower to follow the fall in oil prices and would likely need to experience more downward pressure for nitrogen fertiliser prices to fall significantly as a result.
It would look as if supply/demand dynamics have taken over and are driving an upward trend that will confound any hopes of cheaper fertiliser in the short term. The emergence of Brazil as a major buyer of CAN (calcium ammonium nitrate) following the introduction of laws restricting the use of AN (ammonium nitrate) in that country is impacting on the global nitrogen market. Brazil’s fertiliser consumption is almost equivalent to the whole of Europe and with limited sources of CAN available throughout the world the effect of this new demand will be particularly felt in areas such as Ireland which are also CAN dependent.
The struggle to keep up with the growing demand for nitrogen has been exacerbated by urea supply problems in the Middle East, with Egyptian granular urea production running at 60 per cent capacity due to gas supply shortages. Similarly, phosphate and potash prices are also firm, with logistic and mining issues keeping supply and demand finely balanced and not really offering any reductions which would work through to lower NPK prices. Currency is the other major variable in commodity markets with the strength of the US dollar and the weakness of the euro (the principle currencies for fertiliser trade) driving up prices for European buyers.
Unfortunately Ireland, with no native fertiliser production has no protection against this type of volatility and every shipment has to be sourced from the global marketplace and in competition with all the main agricultural regions.
However there are few investments on the farm which can produce as good a return on investment as fertiliser applied in the early spring. The main challenge, as always at this time of the year, will be for the suppliers to get all their orders delivered on time.
- Category: Feed Forum
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