Major Expansion In Farming Forecast

Press, Volume CIV, Issue 30802, 14 July 1965, Page 15

Major Expansion In Farming Forecast

/Special Correspondent N.Z.P.A.)

LONDON, July 13.

A forecast that a further major expansion in British agriculture was likely in the immediate years ahead has been made by Mr Asher Winegarten, chief economist of the National Farmers’ Union. *

In an address to the annual summer conference of the Agriculture Economics Society at the Harper Adams College, Shropshire, he said there were four principal considerations which would necessitate this expansion.

Mr Winegarten listed these considerations as follows:

Total demand for food in Britain will continue to grow as a result of the increase in population and in the national income. Britain will need, on balance-of-payments grounds, to satisfy a higher proportion of demand from her own resources. Britain has now to face the implications of certain fundamental changes which have been develop-

ing in the organisation and patterns of world production and trade in agricultural products, and of the population “explosion.” Expansion is fully justified on the grounds of British agriculture’s productivity record, not only in relation to Other industries in Britain but also to overseas producers.

Mr Winegarten said with the growth in world population and economic development, new commercial markets had developed in the consuming areas for certain products for which, in the past, Britain represented the main outlet for the major overseas suppliers. “Thus Russia and China are both big importers of cereals on the world market; before the war Russia used to be an important cereals exporter.” Japan had developed as a commercial outlet for cereals, dairy products and, more latterly, meat. In recent years, the United States had emerged as a significant importer of beef from Australia and New Zealand, mainly for the manufacturing outlets. Home Growth "Finally, we have to bear in mind that, in- some countries, the growth of home demand has reduced their export supplies. Argentina is perhaps the best case in point, with her beef exports constituting a smaller proportion of the total supplies and with more countries indenting on these supplies,” Mr Winegarten said. Against this background it was imperative to produce more food at home, and Brit-

ish agriculture’s productivity record warranted being' entrusted with the task. “Years ago, it used to be said that £1 of resources invested in agriculture yielded a lower return from a national point of view than the same amount of resources invested elsewhere. A number of facts suggest that this is no longer true. “First, productivity in agriculture has. according to independent experts, been increasing in recent years at a rate of 5 to 6 per cent per annum—-more rapidly than in manufacturing industry and in the economy generally.” It was also of interest to compare the ratio of gross to net output in agriculture with corresponding ratios for other industries, he said. “In 1962, for every £lOO of sales, the net output of manufacturing industry came to just under £35.

“For agriculture, the figures in 1962-63 were just under £5O of net output for every £lOO of gross output “It is also evident that net output a man in agriculture today is not very different from the average fbr manufacturing Industry and for the economy as a whole.” Capital Needs Mr Winegarten added, however, that the further expansion of British agriculture was contingent on an improvement- in the financial position of full-time commercial farmers who had to finance a significant part of their capital needs from their net incomes.

“Farmers simply cannot go on absorbing increases in factor costs in a period of general inflation without suffering a cut in their real income.

“If we are to get more output at this critical period in our history, we must see that they are given the tools to do the job and that they earn a reasonable return for their efforts and investment,” said Mr Winegarten.