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Farmers View 18th March 2009

After a long and by recent standards at least, hard winter, spring is finally with us once again and the prospect of summer can only gladden the hearts of farmers everywhere.

As we enter this new season, most farm gate prices remain unspectacular and some remain depressed.   We take what we get and we complain at a roughly consistent level because it remains necessary.   Farmers have always, by and large, been poor sellers.   As experts in a highly specialised industry, we have always concentrated our minds and our efforts on production.   Whether our objective has been to either increase efficiency or improve the quality of whatever we grow, we have usually entrusted the selling of our products to someone else who has chosen to specialise in that area of expertise.

The traditional approach to this challenge has, of course, been to form co-operatives.   This is a practice which we can still see across the world on the prairies of Canada, in the dairy industry of New Zealand and with the pig farmers in Central Europe.   It was also, once, commonplace here in Scotland too, but sadly, not in the way it once was.   True, we still have some very successful farmer owned businesses to act as examples.   Look no further that Aberdeen and Northern Marts to see what can be achieved, but where are North Eastern Farmers and the short-lived Aberdeen Milk Company now?

The success stories of recent years have been more likely to be in direct selling.   Our farmers’ markets have provided the opening required for a few of our more entrepreneurial pioneers to make the face-to-face “first contact” with the buying public.   I have nothing but admiration for those who have chosen to sell their own livestock over the counter rather than the weigh brig.   Many a soft fruit grower has also made the move from “pick your own” to the farmers’ markets with some degree of success.   Not only has this improved the understanding between producers and customers, it has developed the confidence required to go on to establish the “farm shop” which has become such a feature of rural life.   The problem is that the farm shops and farmers’ markets, however good they may be, have reached their level in the market, and the majority of us are still selling through the supermarkets and accepting rock bottom prices.

In these circumstances, a reasonable question to ask might be “where do we go from here?”   Well a reasonable place to start would be to try to re-learn the lessons of the past.   Most of our marketing problems have been solved before and, whilst there may be some new thinking around, most will be solved by old fashioned means.   Just look around you.   One of our biggest supermarket chains, ASDA, started life as a farmers’ co-operative.   The biggest player in the UK dairy market, ARLA, behaves like a multi-national conglomerate but, back in Denmark where it started, it is still farmer-owned.

We have done this job before but we let it slip.   We have the enthusiasm to push these developments forward, but the enthusiasts themselves are currently selling sausages or strawberries from a tent in your town centre.   We have the people and the market place where we could kick start a revolution in marketing which we could then leave to the next generation of farmers as a legacy.   So why is it not happening?

Firstly, there are still many farmers around who have had their fingers burnt in the past.   Having seen their efforts discarded, their enthusiasm to do it all over again will be hard to re-ignite.

Secondly, the financial depression which has been with the industry for the past twelve years has left no profits to be ploughed back into marketing.   It would simply cost more than we can currently afford.   Then there is the raft of regulation which appeared during the phase of so called de-regulation, which actually prevents “vertical integration” in the supply chain.   This is not a problem anywhere else in the world.

Finally, will the banks ever again be in a position to lend the money for plant and equipment?

Governments, north and south of the border, have powers to act.   We should change the law to allow farmers to own more of the supply chain.   More of the money currently being distributed by the Scottish Government should be made available for co-operative marketing initiatives.   As for the banks, they used to own us, now we own them!   And the people?   Let us put the new enthusiasm together with the old expertise before it’s too late.