Bernicia Media (2024)

18/12/2024

"Our Man in Berlin" predicted outcome:
BARNIER AND SCHOLTZ VOTED OUT.

Bernicia Media Ahead of The Curve

Bernicia Media predicted on 2nd Dec and posted 4th Dec, the political and economic uncertainty in France and Germany. “The lights are going out all over Europe.”

In another humiliation for President Macron, France voted down Prime Minister Barnier – the first time this has happened to a PM since 1962. France cannot hold an election until June 2025 due to its constitution not allowing more than one election in a year.

Bernicia Media also stated Germany would have an election in February 2025 (now confirmed for 23rd Feb) after Chancellor Olaf Scholz was brought down this week by 394 parliamentary votes. Here’s what we predicted two weeks ago and as far back as Oct 2019.

“The two powerhouses of Europe; Germany and France - the two economic pillars of the EU - and the largest contributors to the EU budget – are both facing political and economic uncertainty. France, led by President Macron and PM Barnier, may be forced into a General Election that may change the political direction of France.

“Likewise, the political landscape of Germany may change due to its economic downturn, competition globally from cheap EV cars from China and migrant concerns.

“Germany’s car industry faces immense challenges - with Volkswagen due to close three factories - and want any retained car workers to take a 10% pay-cut. Furthermore, Germany will have a General Election in February 2025 with the political pendulum in both countries swinging to the right.”

As far back as 23 Oct 2019 Bernicia Media monitored the economic downturn in Europe’s largest economy: “Germany Slides into Recession.”

“Germany officially slid into recession according to the country’s Central Bank. This being due to global trade concerns; disruption to the German car industry and – fears over Brexit. The major concern for the German economy is its reliance on exports.”

Bernicia Media – Ahead of The Curve

13/12/2024

Bernicia Media Farmageddon XXIII

THE LAST CRUSCADE – Why Farming’s Voice Will Fall on Deaf Ears.

In 1936, 200 men walked 300 miles to London to deliver a petition to Parliament as a result of mass unemployment in Jarrow following the closure of Palmer’s shipyard.

From the 5th October – 31st October, the 200 men endured cold; rain, wind, hardship, fatigue and aching feet. They slept in village halls and church halls, had the odd rest days and were fed by well-wishers.

In 2003, Cornelius Warren, the last man standing from the Jarrow Crusade stated the Jarrow march had been “a waste of time.” But added he had “enjoyed every step.” Unemployment and resentfulness continued until 1939 before the town’s fortunes changed. It took a war to revive its prosperity.

Some may disagree that the farmer protests in London have been a “waste of time.” And like Cornelius Warren, many farmers and supporters will say they “enjoyed every step.” The farmer-group actions are well intended and should be applauded.

It is the only “reasonable and responsible” action that rural protesters can take in order to make farming’s voice heard in Parliament. But sadly, the voices of rural dissention will fall on Westminster’s politically tone-deaf ears.

The Labour government has a massive 200 seat majority and has neither the need nor inclination to call a General Election until 2029. The Asset Inheritance Tax is not being introduced until April 2026 – some 16 months down the road.

The government can sit back and roll with the punches, with the possibility, like George Foreman against Muhammad Ali, farmers will wear themselves out, before Reeves inflicts the knock-out punch by delivering Asset IH Tax. By then, the result will seem an inevitability – the greatest tax raising “rope-a-dope” act in history.

Meanwhile, the “war on farming” continues – unrelentingly. It may take a war – to revive and appreciate farming such as what we witnessed when Russia invaded Ukraine causing inflation and rising costs to farmers such as fuel, energy and nitrate fertiliser increasing 300%.

Russia banned the exportation of nitrate fertiliser in 2022 (Feb 2nd) three weeks before the invasion. Bernicia Media was the only voice to call-out the action stating Russia “had fired the first shot in the invasion of Ukraine.”

Bernicia Media stated on 22nd July 2024 – some 18 days after the General Election and 105 days before the official Budget announcement – that farmers would encounter “business asset taxation.” And 70 days and 50 days prior to the announcement, had written and stated on GB News, what was going to happen - and the consequences to farming. Meanwhile, “England Slept.”

This is not a political post against a UK government that has clearly lost its way on numerous fronts including old-age pensioners, green energy, VAT on private education, business asset tax and raids on private pensions.

On 22nd July, Bernicia Media stated (Farmageddon XVI) “Following the UK General Election (4th July) a new Labour Government came into force. It’s in everyone’s interest to wish (any) incoming administration a successful term in office.”

For the record, and we keep repeating – the Labour manifesto contain 87 words on farming. Business Asset IH taxation was not mentioned. It now seems inevitable the14 year long-awaited “change” of a Labour Government - will be a one-term administration.

Farmageddon XVI 22nd July 2024

BUSINESS WOES

Quote: “Sadly, there will be financial and business repercussions; business asset taxation, food inflation, energy cost, interest rates and mortgage rates. Farmers are struggling to earn a living – and pay their bills.” Unquote.

While 2029 seems a long time until the next General Election, things may change. In the 1991, Bruce Jobson wrote an article on the self-inflicted demise of a well-known industry leader stating: “The first rule of politics remains, first you acquire enemies – then you acquire friends.”

In the case of the Labour leader Sir Keir Starmer - he will eventually run-out of friends.

04/12/2024

Mercursor Trade Agreement

“The (car) lamps are going out all over Europe, we shall not see them lit again in our lifetime.” Adapted from Sir Edward Grey, 3rd August 1914.

The prophetic words of Earl Grey send a poignant message to European Governments with regard to Net Zero. Britain’s car manufacturers are closing factories due to Net Zero policies with the loss of 1,000 jobs at Vauxhall’s Luton plant. There will be thousands of jobs at risk to Vauxhall’s suppliers – probably another 8,000 to10,000.

The cost of EVs is prohibitive – with struggling families unable to afford EVs – costing on average £40,000 to £60,000 - and pay the mortgage and cost of living increases. The same is happening in Europe as German car exports as well as its domestic market, struggle with sales.

Apart from companies purchasing EVs for “fleet sales” – the EV market is flat with car sales pointing downward. There is not the charging infrastructure to cope with EVs and Bernicia Media called-out the Net Zero policy back in 2019 – at a then estimated Net Zero cost of £1trillion or 44% of GDP. Today, that cost is above £2trillion and another £3trillion in infrastructure roll-out.

The two powerhouses of Europe; Germany and France - the two economic pillars of the EU - and the largest contributors to the EU budget – are both facing political and economic uncertainty. France, led by President Macron and PM Barnier, may be forced into a General Election that may change the political direction of France.

Rising prices and farmer unrest may also surface in the next few weeks due to the EU’s Mercosur Trade Agreement. More on that later. Likewise, the political landscape of Germany may change due to its economic downturn, competition globally from cheap EV cars from China and migrant concerns.

Germany’s car industry faces immense challenges - with Volkswagen due to close three factories - and want any retained car workers to take a 10% pay-cut. Good luck with that. Furthermore, Germany will have a General Election in February 2025 with the political pendulum in both countries swinging to the right.

Ford continues to struggle to the new market conditions of Net Zero and low market demand for EVs, and has announced 4,000 job cuts over the next three years. Similar conditions with car-giant Nissan are in-place to reduce 9,000 jobs - to keep the company viable - with potential redundancies at Nissan’s Sunderland’s factory that employs 7,000 people. And probably another 10,000 supply workers.

EV cars are required to make 22% of UK market-share under Government legislation – with firms not achieving these targets - liable to pay huge fines - and these businesses are required to achieve 80% market-share by 2030. A tall order. State legislated Communism, dictating inflicted choice over a democratic country’s free-market supply and demand economy. All part of “Red-Ed” Millibrain, unveiling Moa’s latest “Five-Year-Plan.”

MERCOSUR AGREEMENT

After 25-years of negotiations between the EU and four South American countries, the Mercosur agreement, if implemented, will have a major impact on European food production. Argentina, Brazil, Paraguay, Uruguay and potentially, new-comer, Bolivia, make-up the trade-agreement. The agreement will remove 90% of duty on EU goods exported to the Mercosur countries opening total market access to the group of 700million people.

This will result in approximately 300,000 tonnes of beef (now states 99,000 tonnes ?) from Mercosur countries to be imported in the EU-27 – albeit with a 7.5% duty. An additional 180,000 tonnes of poultry would be duty-free as well as expectant sheep meat. Understandably, the volatile French farmers will oppose the free trade agreement and likely to voice their concerns in the run-up to the expected French General Election.

Germany and Italy are supportive of the agreement in order to export expensive cars to the Mercusor countries - to help prop-up the EU’s failing car industries. Yet again, another trade-off at the expense of farmers.

Cheap food imports and questionable animal welfare standards compared to EU applied standards; allied to lower production costs and labour costs, will undermine food security, resulting in a further decline in farm profitability.

As the UK Government presses forward with its Farm Asset IH tax – and another farmer demonstration planned to take place in London on 11th December – UK farmers are revolting. The global war - and the economic war - on farming - continues.

“The tractor-lights are going out all over Europe, we shall not see them lit again in our lifetime.”

Bernicia Media - Ahead of The Curve.

03/12/2024

Genetics: Inbreeding and Heterosis

Canadian Sire Evaluations 3rd December 2024

VJ Gislev ranks at #2 on progeny proven LPI listing and #3 on Pro$
Vivaldi still ranks #1

"Rather than turning over faster generation increases – it is possible to capitalise and deliver advancement by within-breed heterosis effects (hybrid vigour)"

Congratulations to Gislev, owners and breeders.

Summary from Bruce's recent article in The Scottish Farmer on Inbreeding and use of within-breed heterosis in the Jersey population. Scroll down for full article.

27/11/2024

Thanks to The Scottish Farmer:
In an exclusive article in this weeks Scottish Farmer, Bernicia Media's Bruce Jobson traces the acceleration of inbreeding coefficients and predicts the level of inbreeding within the Holstein breed will reach 10% by the end of 2025. How did inbreeding get to this level?

INBREEDING

The traditional view held by geneticists remains that inbreeding levels are preferable at a 6% or below threshold. It is at the 6% level and above, geneticists raise concerns inbreeding levels have a detrimental effect on numerous animal health and welfare traits such as fertility; reproduction, disease, longevity and general well-being.

However, let’s back-track 40-years to review the warning signs that have been ignored by the cattle-breeding industry in its never-ending quest for faster generation turnover and ever-increasing genetic advancement. This period also coincided with the AI industry taking greater “control” over the direction of traditional breeding programmes previously the domain of registered cattle breeders.

Dr John Hinks (Edinburgh) wrote a forward-thinking paper on “Centralised Breeding Schemes” (to generalise) and proposed a more structured system of sire procurement via use of nucleus herd schemes. Dr Hinks’ paper was followed-up by incorporating the use of embryo transfer technology using multiple ovulation techniques known by the genetic acronym, MOET.

MOET THEORY

Co-author of the MOET theory was Prof. Charlie Smith (Edinburgh and later the University of Guelph, Canada) The MOET theory aimed to reduce sire generation intervals by half, from approximately seven-plus years, the time taken for a bull to be fully randomly progeny-proven through an official testing scheme, based upon daughter performance records against contemporary daughters of other sires.

During this time, unproven young bulls were laid-off at stud for at least five years, in itself, a lengthy and expensive period, until progeny-proven. Selection intensity was generally accepted to be one-in-ten sires (1:10) returning to active service following performance assessments, with the other nine sires discarded.

The MOET theory proposed multiplying male and female progeny from elite females; with the daughter’s performance records being assessed on first lactation records, against other contemporary female sibling groups in the nucleus herd scheme. The male progeny siblings were “proven” on the basis of their female sibling performance – due to close sibling genetic correlation. All animals were under the same environmental and management conditions without preferential treatment.

Male progeny semen was to be distributed through sibling-brother “bull teams” - four or five male siblings to reduce “risk.” On this basis, genetic performance could be assessed between 36-48 months. In writing the critique on the MOET theory (Jobson 1987) numerous concerns became apparent, including, calculations not carried forward through five generation faster turnover.

The generations were speeded-up and progeny born could be in generation three before generation one was “progeny-proven.” This also resulted in increasing inbreeding concerns. Charlie Smith confirmed the MOET critique was correct at the Third World Congress on Genetics at Edinburgh in 1990.

However, Charlie stated the MOET “theory” was in fact an “academic exercise” and had not expected MOET to be developed from an academic theory into practical establishment. Another MOET critique concern; the conclusion after extensive calculations; the sheer cost involved made the programme “financially unaffordable.”

Third World Congress on Genetics Edinburgh 1990

At the Third World Congress on Genetics (Edinburgh 1990) Dr Ted Burnside, Department of Animal Science, University of Guelph, offered prophetic warnings in relation to the increasing level of in-breeding within Holstein cow populations. The esteemed audience of geneticists, leading academics and AI industry representatives were stunned into silence. Almost 35 years later, the concerns expressed by Dr Burnside are stronger than ever.

The average level of inbreeding within the Holstein population in 1970 was recorded at 0.5%. At the time of the MOET theory critique (1987) the level of inbreeding was 2% and when Dr Burnside raised his concerns three-years later at the Third World Congress, inbreeding had risen to 2.5%. Within ten years (2000) the inbreeding rate in the Canadian Holstein population had doubled to 5%.

The 2019 data reveals inbreeding levels at 8.13% for Holsteins and an annual average increase of .25%. With a degree of accuracy, having accurately predicted inbreeding levels (2021) in Holsteins would increase to 8.63% and likewise, Jersey inbreeding levels (2019) increasing to 6.9% (.10% annual increase for 2021) to rank Jersey inbreeding levels of 7.1%.

Over the past 30-40 years, the use of ET technology allied to genetic population changes have helped alter, slow down and increase the level of inbreeding. This has been easier to track through the Canadian one-year rolling base system with the annual average increase in the Canadian population between 1970 -1980 being 0.12%. At that time, there was little genetic influence from US sires and none from Europe.

Hanoverhill Starbuck

From 1980 - 1990 the annual inbreeding rate decreased to 0.07% due to US bloodlines being introduced, and thereby providing an outcross to traditional Canadian bloodlines, allied to the increasing influence of Hanoverhill breeding. From 1990–2000; the annual trend fluctuated by increasing to 0.27; as the influence of Hanoverhill Starbuck, and his son, Madawaska Aerostar, and his sons, accelerated change. Outcross bloodlines from the US and Europe began to increase in influence and between 2000-2010; the inbreeding rate dropped back to 0.07%.

From 2009, the introduction of genomic technology resulted in the further reduction of the generation interval and the annual rate of inbreeding increased to 0.21%. Other major cow populations accelerated inbreeding rates as international breeding programmes competed more aggressively, using similar bloodlines; ET and Invitro technology allied to genomic sire identification technology.

The collective technology resulted in further increasing inbreeding levels predominantly within the Holstein breed. Having attended conferences in Canada dating back to 1991 on the research and development of genomics – then known as DNA markers – one of the proposed emerging benefits of DNA technology was to find genetic “outliers” – both male and female.

The theory being an outlier female, from outside mainstream bloodlines, could be identified as a potential high genetic bullmother. This would result in an outcross mating and reduce inbreeding levels across a broad population. Paradoxically, the result was greater intensive genetic selection of high merit parents and further narrowing of the bloodlines.

There is a misconception the Holstein breed is disadvantaged through inbreeding levels when compared to other breeds but statistics suggest otherwise. Jersey inbreeding levels (2019–2020 base) increased to 6.9% (.10% annual increase for 2021) to rank 2022 inbreeding levels at 7.1%. Having previously predicted the 2022 inbreeding levels in 2019 (see box) these calculations are close to the official 2022 Canadian figures - with all major dairy breeds identified above the recommended 6% level.

Breed 2022 predicted 2022 Actual Predicted 2025
Ayrshire 6.72% 6.73% 7.33%
Brown Swiss 7.15% 7.09% 7.84%
Guernsey 7.24% 7.50% 8.0%
Holstein 8.63% 8.86% 10.16%
Jersey 7.10% 7.10% 7.7%

Calculating forward to the end of 2025, the Holstein breed will have 10% inbreeding levels or above. Inbreeding depression can result in reduced production; increases reproduction problems, increase susceptibility to disease and can increase metabolic disorders, which all reduce an animal’s utility, profitability and lifespan.

GENOMICS

Breeders often relate to modern Holsteins having the above-mentioned concerns. From a phenotype perspective, due to genomic unproven sires being constantly used on genomic unproven sires; breeders cannot correct negative type and production traits and consider animals are often narrow-chested; lacking in strength throughout, display poor rump-structure and lack vigour. Udders and leg traits concerns are also cited.

Within a 50-year timescale, Holstein inbreeding has increased from 0.5% to 10% or over a tighter 35-year period (1990) of 2% to 10%. This is an alarming rate, due to faster generation turnover and intensive genetic selection, to which sections of the cattle-breeding industry appear oblivious. Some programmes are so far over the genetic horizon, strategic direction and vision has been lost – and the consequences continue.

There are always individual sire exceptions to the norm, one being show winning specialist, Braedale Goldwyn. Born in 2000, the bull’s inbreeding levels peaked at 16% with a 17% relationship to the Holstein breed. Looking back at some of the famous Canadian Holstein sires, it is possible to track inbreeding levels and percentage relationship to the population.

Roybrook Starlite

One of the most famous Holstein sires of the 1970s was Roybrook Starlite (born 1968) that had an inbreeding rating of 0.93 and 3% population relationship. By the end of the decade, Hanoverhill Starbuck (born 1979) would subsequently emerge as a sire of sons and grandsons, and have an inbreeding rating of 3.79% and 19% relationship.

Starbuck’s greatest son, Madawaska Aerostar (born 1985) would help propel the bloodline forward and offered 7.39% inbreeding ratings and 20% population relationship. Two of Aerostar’s most popular sons were born in 1991, Startmore Rudolph (2.30% and 16% relationship) and Maughlin Storm (1.35% and 17%) These bulls included outcrosses to US bloodlines including Mattador and Valiant son, Hanoverhill Inspiration.

In the modern genomic era, a young “progeny unproven” bull has a genomic index rating equivalent to 30 milking daughters. Therefore, more female progeny – often thousands of daughters - are born at the start of a young Holstein bull’s AI career; rather than after traditional progeny testing methodology whereby a sire had a first evaluation based upon 70 randomly tested daughters.

Once progeny proven, semen was then released for widespread distribution with the elite bulls achieving production of one-million units and marketed world-wide. With thousands of genomic daughters now being born at the start of an AI career, rather than after progeny-proven, this accelerates inbreeding levels due to faster generation turnover.

Today, there is not 1:10 genetic intensity; in fact, there is not any genetic intensity; with all genomic bulls already assessed as “proven” albeit, numerous sires fail to live up to original genomic evaluations. Many sires would not return to “active” service under the previous first-crop evaluation system.

The cattle breeding industry, should consider specific breeding goals and breeding strategy, rather than merely compete in a faster generation genomic race. The one-dimensional approach carries the previously identified “Laws of Unintended Consequences” such as further increased levels of inbreeding, allied to numerous animal health and welfare concerns.

HETEROSIS

Identifying specific dams or cow families, identifying selective breeding goals, including a more “balanced” approach by using outliers or outcrosses from international cow populations, will result in positive benefits and reduce inbreeding. Rather than turning over faster generation increases – it is possible to capitalise and deliver advancement by within-breed heterosis effects (hybrid vigour) as in the UK imported cases of Linmack and Adema 88 from Canada and Holland, respectively.

Capitalising on the positive effects of step-by-step heterosis within individual strains (within breed) will result in healthier, longer-lasting, more profitable cattle by specific bloodlines developed for increases in fertility, disease resistance, production traits and conformation.

Additional information drawn from Bruce Jobson’s Moet Theory Critique (1987) and his paper at the 104th US National Holstein Convention, Minnesota (1989) entitled: “Advanced Genetic Advancement in Relation to Economic Milk Production by Incorporating Various Strains of Cattle within National and International Breeding Programmes.”

22/11/2024

Bernicia Media Farmageddon XXII

SAVING THE COUNTRYSIDE: THE SYSTEMIC FAILURE OF UK GOVERNMENTS

TEN DISCUSSION POINTS TO SAVE FARMING
STARMER-MATHEMATICS
STARMER-ECONOMIC THEORY

For the past 44-years, successive UK Governments have failed farmers and rural communities. Farmers – and therefore the countryside - has been treated with distain. In 1980, the UK was 80% self-sufficient in food production – today that figure is 50% - 55%. This is gross negligence. Any CEO of a major company would be sacked for this level of incompetence (under-performance)

The current CEO of UK plc – along with his Chief Operating Officer (COO) would be sacked by the shareholders based on the performance of the past four months. Unfortunately, UK plc shareholders are unable to call for an extraordinary general meeting to establish a vote of no confidence – probably for another four-plus years. But the current incumbent CEO has only been in-post a mere four months – not 44-years. This is the systemic failure of successive UK governments – and successive UK policies.

The COO (sic) also holds the position of Chief Financial Officer (CFO) and has caused consternation amongst millionaire peasant farmers. The Masterplan is to tax farm assets – a death-tax – when the farmer is dead – so the farmer will not have to worry about personally making the payment – because he / she is already dead. That’s extremely considerate. Even more considerate – the COO is allowing the dead farmer ten-years to pay the tax – and even more considerate – at zero per-cent interest.

This is because UK plc needs tax-payers money to pay £22billion for carbon capture and long-term £5trillion cost of net-zero (2023) … Oh yes and the Foreign Aid Budget (£8billion) and migrant hotels (£6billion) The COO wants £500million annually from farmers. Farm land is just sitting there – doing nothing apart from growing crops – and feeding the nation. Taxing farmers on a non-liquid land asset is financially beneficial according to the COO. The “average” farm only makes £12,000 per-year profit – and 50% of farms do not make a profit.

What makes this IH tax so enticing to the COO - is farm land average is worth £7,000 - £10,000 per-acre. How does that compare to a farmer’s income being half than that of the minimum living wage – and less than the average OAP’s State Pension? Farmers may decide to sell the land but who will buy the land as it is a future tax liability? Meanwhile, the COO defiantly says to the millionaire peasant farmers: “Show me the money.”

But we preface with one question – one specific question – one for the “experts.” (4th Nov 2024)

The average age of a UK farmer is 64-years old, sadly old Jimmy dies of cancer. Six months later, his son, Jim (42) works all hours and drops dead with a heart-attack. But how does Jim pay IH tax of £500,000 following his father’s passing? Equivalent to £1,000-per week for 10-years. And now - how does the late Jim’s son, 20-year-old Jimmy, pay-off Granda’s IH tax bill – and pay off his Dad’s IH tax bill – and keep the farm?

Working farmers are at the bottom of the food-chain. Farmers are not price makers – they are price takers. Farmers cannot control prices. They cannot control output price (milk) – and cannot control input prices (feed, energy, diesel etc)

The Labour Government in the 1970s introduced a similar form of taxation - and failed by putting small farms out of business. This Farm Land Asset Tax policy is being introduced in April 2026 – and may ONLY run until a potential new government can reverse Farm Land Asset IH Tax in 2029.

ALL IS NOT LOST – JUST DON’T DIE BETWEEN APRIL 2026 AND APRIL 2029.

TEN POINT PLAN FOR DISCUSSION

What should happen – something we’ve stated many times over the years (and also on 4th November 2024 in Farmageddon XXI. See further below.

• Anyone not earning 80% of income from farming (non-farming income) should pay Farm Asset IH tax at disposal.

• This should be for a minimum 80% income period of 10 consecutive years thereafter on a 10% annual sliding scale – a gradual long-term investment claw-back.

• To buy UK farm land – an individual has to be a UK national, pay UK taxes and be resident for a minimum 160-days per year. There is a case to not allow multi-national companies to buy UK farm land.

• Foreign nationals (must be resident 160 days) multi-national corporations, non-farming businesses, should pay 25% farm land investment tax above the purchase price (plus Stamp Duty) at the point of purchase (£10,000 per-acre plus £2,500 tax = £12,500 per acre) The farm when sold is subject to IH Tax – there is no IH tax exception. In other words – double-taxation before purchase and after disposal. Farm land price may or may not increase in value.

• Therefore, the same applies to bankers, investment banks, pension funds purchasing farm land as a form of tax evasion.

• Having bought farm land in the past, these institutions and individuals – have to pay Farm Asset IH tax at disposal - even if purchased 30 or 40 years previously. Albeit land prices will have increased.

• Any individual, company and institution have to actively “farm” the land – produce accounts and not use for tree planting, off-setting emissions, rewilding etc, apart from the accepted (current norm) of 20%.

• Purchasing farm land needs to be non-incentivised as an IH tax-loophole for non-farming businesses. Instead of buying farm land, these companies should pay higher level taxation.

• Non-high street businesses such as Amazon should pay higher tax - rather than current business-rate exemptions that are levied on high street. This would help albeit not farm related.

• Businesses such as supermarkets should pay higher taxes – supermarkets are making record profits. Taxation could be reduced by various means such as buying minimum (70%?) UK homegrown food products – more a point of further discussion but an incentive to buy home-grown, home-reared food products.

STARMER -MATHEMATICS

The price of farm land has increased – by over 100% in the past 10 -15 years – predominantly by the above-mentioned non-farming purchases. The financial returns have remained the same for many decades – one cow per-acre; four ewes per-acre and about four tonnes of wheat or barley grown per-acre. This is the reason that farmers are cash-poor and asset rich.

The low financial returns are unable to pay for the IH tax legislation. If a farmer has to pay £500,000 over ten years – £50,000 per-year or £1,000 per-week. It’s an impossible financial cash-flow commitment. All the “experts” – politicians and Treasury Civil Servants have a myopic view and cannot comprehend actual practical farming returns. This myopia shows a lack of business understanding.

Fortunately, let’s use Starmer-mathematics to explain. UNLESS the ten-point discussion plan is introduced – to prevent multinational corporations et al buying UK farmland - the price of farm land will continue to increase beyond its financial return capability. UNLESS farm asset IH tax is cancelled – the following will happen.

Farm land will continue to increase in price – some multinationals are already paying double and treble the current average price of farm land – in order to plant trees to offset carbon emissions. In another ten years hence, if farm land increases from the current £7,000 -£10,000 per-acre to a 2034 level of £14,000 - £20,000 per-acre – the same Starmer-mathematics will apply – one cow per-acre; four ewes per-acre and four tonnes of wheat and barley per-acre.

In 2000, average land values were approximately £3,000 per-acre. In 1990, land was £1,200 per-acre and back in 1970, £300 - £400 per-acre. The Starmer-mathematics remain the same; one cow per-acre; four ewes per-acre and four tonnes of wheat and barley per-acre. Dairy cow milk production has increased – likewise arable prices – but not in relation to the increases in farm land value. While farmgate-prices have increased albeit, so has input costs; buildings, energy, feed, machinery, labour, etc but the basic economic model remains the same. A farmer cannot magically, maintain four dairy cows per-acre; ten sheep per-acre and eight tonnes of wheat per-acre – unlike a factory that can increase car production literally overnight.

HOWEVER – we are not yet finished with Starmer-mathematics and Starmer-economic theory. This is where the inherited and systemic failure of UK Government policies impact farm business profitability – and the inability to pay Farm Asset IH tax. Under the Conservative Government, farmers are required to set aside 20% of farmland for tree-planting and wild flowers. These “greening” policies have been welcomed by lobbyists albeit, maintained at the cost of UK food security.

A 500-acre farm is therefore required to allocate 20% of its area or 100-acres to these schemes and receive a subsidy payment. In 20 - 30 years hence, payments will cease – these payments will not be paid for perpetuity. The vast acres of land planted for trees will mature around 2050 – 2060. However, the majority of trees, as is the case with trees planted to offset the likes of airline and multi-national company emissions, are broad-leave varieties - that have little or no commercial value. By then, these vast areas will resemble a wild jungle – trees planted too closely together - and the land likely to be unfit and uneconomic to revert back to food production - at any future date.

HOWEVER – our millionaire peasant farmer will still be liable to pay Farm Asset IH tax at future farm land value. However, the farmer has “lost” 20% of his land in which to grow profitable arable crops to help pay IH tax on the farm. Not good, eh? HOWEVER, another problem has beset our hard-working millionaire peasant farmer. To keep this simple for non-farming readers, the previous government – presumably on the advice of Defra – restricts the use of nitrogen as part of “greening” policies. This results in reduced crop-yields such as wheat; barley and bountiful grass growth for grazing and silage consumption by dairy and beef cattle as well as, sheep grazing. Not good, eh?

The farmer will already have a reduction of 50 dairy cows or 200 ewes or 2,000 tonnes of wheat and barley from his now 50acre tree planting and wild flower acreage. Therefore, a conservative figure of a 10% reduction in crop tonnage volume can be anticipated in order to comply with nitrogen reduction requirements. Overall, its fairly safe to maintain, a farmer will suffer a reduction of 30% of productive capacity in terms of tonnage, yields and livestock numbers. In simple terms, the equivalent of a reduction from a productive 500-acre farm to an equivalent productive of a 350acre farm.

Hopefully, this will make sense to anyone that understands Starmer-mathematics and Starmer-economic theory. The farmer will in real-terms have to pay the Farm Asset IH tax bill levied on a 500acre farm from 350 productive acres. In other words - Starmer-economic insanity.

Bernicia Media

18/12/2024

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04/12/2024

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