MPs heard evidence from food and drink manufacturing experts on the urgent need for government intervention on energy support for farmers and questioned the panel about the threat posed by the conflict to farm business viability.
The committee, made up of MPs across the political spectrum, heard evidence from Rohit Kaushish, Chief Economist at AHDB; Andrew Opie, Director of Food and Sustainability at the British Retail Consortium; and Jo Gilbertson, Head of Fertiliser at the Agricultural Industries Confederation.
The NFU briefed MPs ahead of the session and continues to feed in evidence from members about their experience with the price and availability of red diesel and fertiliser.
Threat to farm business viability
Sarah Bool MP (Conservative, South Northamptonshire) highlighted the numerous input price shocks that British farming has faced in recent years and the current increase in red diesel prices. She asked the panel if this was “a tipping point for farm business viability” and stressed the importance of long-term support for the farming sector.
Committee Chair and Liberal Democrat MP for Orkney and Shetland Alistair Carmichael pointed out that the current crisis comes at a time when low farmer confidence is already limiting investment, and on the back of two bad harvests for arable farmers.
Rohit Kaushish of AHDB outlined the importance of market transparency for improving farmer confidence during price shocks, and the particular challenge around transparency on red diesel market prices.
He noted that red diesel prices for farmers on the ground are variable, and problems with availability have also been reported. You can share your experience of key input prices using our online tool to help us build a picture of cost pressures and market volatility.
The NFU has called for regular, independent price information to allow farmers to risk manage and avoid being exposed to sudden, opaque price movements.
Energy-intensive sectors
Josh Newbury, Labour MP for Cannock Chase, emphasised the pressure producers are under from rising energy costs, highlighting the particular impact on energy-intensive sectors such as horticulture.
Mr Newbury, a graduate of the NFU’s Food and Farming Fellowship, told the panel that “although costs will be felt by consumers further down the road, the opportunity to stop them is now”.
He suggested that government should consider support for costs beyond electricity such as “fertiliser” and said he was particularly concerned about red diesel.
He argued that government intervention on red diesel would be an opportunity “to directly support producers right now and target that support in quite a concerted way”.
Andrew Opie of the British Retail Consortium said that Mr Newbury’s concern about energy prices was “spot-on” and called on the government to support energy-intensive farming sectors with energy costs.
The NFU has called on government to postpone and rethink the introduction of crippling standing charges for electricity in farming sectors. Find out more about the NFU’s five point plan, outlining our asks to government.
