Agriculture In The E.E.C. NEW CHALLENGE TO BRITISH FARMERS

Press, Volume CI, Issue 29713, 5 January 1962, Page 8

Agriculture In The E.E.C. NEW CHALLENGE TO BRITISH FARMERS

IBv

C. W. SCOTT

in ths "Daily Telegraph”)

(Reprinted bv Arrangement)

London. December 14, — If Britain joins the Common Market, British farmers are bound to find themselves in a very different world. The [Continental system aim® at maintaining average wholesale prices rather than individual farm sales, so that support at the farm gate as we now know it would go, and a new outlook will certaiply be needed. Farmers will have to look ahead much more; they will need to find their markets before planning their cropping, and they will have to devote much more of their time to selling their produce. Conditions generally are bound to become much more competitive between farmer and farmer as well as between Country and country. This may well mean greater opportunities for those ready and eager to seize them, but there will be less room for the man unable or unwilling to help himself. There are several points in which British farming starts ait, a disadvantage compared with the E.E.C. countries. Labour Costs

Our labour costs are much higher. On one Italian fruit farm I visited recently the hourly rate was only Is 9d and these men worked a 10-hour day. When I asked several of them why they did not move into the towns where they could earn twice as much, the almost universal reply was, "Why should we. when we like farming and can earn enough to live on here?”

This understandable outlook may well defeat all attempts to bring up wages on the land. In such circumstances they are bound to be controlled by supply and demand.

Low labour costs may not. however, be quite so serious a threat to our farming -as they at first appear, because these are offset by an almost complete lack of mechanisation and the gross output per man is therefore far lower. Climate Differences

The Continental climate is better than ours for both horticulture and cereal growing. No E.E.C. country thinks in terms of grain-driers. Yet in spite of climate advantages the present wholesale price of barley in West Germany is 36s per cwt, which looks very attractive indeed to me. At the other extreme the French price is only 235. compared with our own guaranteed price of 27s 7d. Undoubtedly the bigger French farms can beat us at com growing, and were the E.E.C. “target” price to be fixed materially above the present French price, there is considerable potential for increased French output with the aid of fertilisers.

The cereal “target” price is the key to the whole of the Common Market farm support system. If this is set too high, excessive tonnages of grain will be encouraged and high corn prices will push the livestock farmer out of business because his feeding stuffs will cost him too much. On the • other hand, if the cereal price is too low, the corn grower will go bankrupt, while the livestock farmer will have it too easy. The commission which sets “target” prices expects that by the time a standard price has been reached for the whole community, it will be much nearer the present French price than the West German figure. Should this prove correct, com growing here will not be as attractive as it is at present. Support Scheme*

If we join the Common Market, control of farm support will pass to a commission largely made up of men from Continental countries. But this may prove arr advantage rather than the reverse, for the chances of farmers getting a fair deal should be greater where control is exercised by countries with up to 32 per cent, of their populations in agriculture compared with our 5 per cent.

On several points. British farmers start at an advantage. Our farm structure is far superior to that of most of the Six. Although 62 per cent, of our farms are under 40 acres, the corresponding figures on the Continent are: France 76. Welt Germany 92. Italy 95, and 96 for the Benelux countries. More important still, 15.5 per cent, of our farms are over 100 acre® compared wtih an average of only 2.9 per cent, above 100 acres in E.E.C. On all but the most backward British farms, technical know-how is superior to that on the equivalent E.E.C. farm. This is in no small measure due to our excellent advisory service, which particularly in its availability, is better than anything on the Continent French Advantage On the less advanced farms we probably lag behind, particularly when compared with the French peasant, who bs an extremely good farmer; hardworking, painstaking and possessed of a huge fund of inherited knowledge. Our climate is not entirely against us. It is ideal for grass and the best British pastures, properly managed, are unbeatable. Our livestock farmers should be in a particularly strong position, for we also have tome of the best strains of beasts in the world. The E.E.C. does much more for farmers than support "target” prices. It is well aware of the shortcomings of its farming structure. In France the Societe Fonciere has been formed to buy up derelict estates and peri, pheral small holdings. These are then completely reorganised into compact farms of between 40 and 120 acres, depending on whether they are horticultural, livestock, or arable, and are then resold. Losses of up to 50 per cent, arising out of such reorganisation are borne by the State. In Italy there do not seem to be any large State-planned

schemes to deal with th® fragmentation problem, serious as this is. There is. however, extensive help for various co-operstive efforts. For example, the Contina-Sociale Veronese Del Garda wine cooperative got a 30 per cent, grant plus a 30-year loan for the remainder of its cost at 3 per cent, interest. Profit Sharing

This concern serves vineyards in it* district and is capable of handling 25.000 ton® of grapes annually. Producers share in any profits according to their throughput. These “cellars” form a most impressive factory with plenty of white tiles about as well as lots of stainless steel. HoWever it seemed to me that there is still a good deal to be learnt about the control of fermentation, for the wine I sampled was very harsh.

Irrigation is even more heavily subsidised by the Italians. One plant I saw provided a piped sprinkler system to 20 fanner* farming 800 acres between them. A state grant of 75 per cent, towards this beautifully laid-out installation enabled each farmer to have six hours per week of rain at 7mm/hr for a cost of only £4 per acre per year There are already 26 of these irrigation co-operatives. Sufficient water, along with a friendly climate and good soil, produces marvellous results. One farmer told me that he usually got a hay crop of five tons per acre, obtained from five successive cuts. In Holland there are the Polder schemes which only recover half of their costs when sold to fanners. Most of these substantial aid schemes are permissible in the EEC. farming plan, and it seems fairly certain that our direct grants, such as the fertiliser subsidy and the ploughing up grants, which today account for some £lOO million of the total £2BO million subsidy, would also be allowed to continue if we joined the community. The Prospects

Thus on balance it looks as though British farmers approach the Common Market from a fairly good poai. tion. How well Britiah agriculture is to fare if we go in will depend very largely on the skill with which our negotiating team do their work. It seems to me that the risk to farming, if we stay out of the Common Market, is probably greater than if we go in. Out of the E.E.C. Britain is bound to become the dumping-ground for the bulk of the steadily increasing surpluses of the Six. Should this happen, prices would alump, subsidies would soar and the whole support system as we know it would almost certainly collapse. Even if this did not happen, pressure by the Six for us to accept their surpluses in payment for exports would be so strong as to become a condition of sale. Hom* farming would then quickly become a wasting asset.