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Originally Posted by Dont be daft
Economies of Scale
Your talking about economies of scale, very valid point in most industries but not of such importance in agriculture. Larger farms dont have the bullying power that you would associate with large companies like for example Tesco.
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No, they don't have the bullying power of Tesco. And Tesco gouges suppliers.
The thing is with economies of scale, someone with a large easy farm, may not require that much man power. Doubling the livestock, doesn't necessarily double the work.
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Some of the best farmers around in terms of profit and productivity are small scale single worker farms with very little debt.
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Yes, I imagine that would be true.
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What keeps farms running at a loss is the fact that they are price takers instead of setters. They have no input to price they get for their product and have been continually squezzed by retailers for the last 30 years irrespective of their scale.
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And that is an incredibly bad position to be in. If you have a limited choice of customers you're screwed. Tesco, in fact, in England now, they're getting into the business of buying their own super farms for production. They've also been dealing individually with farms, where they dictate the price - and the profit margins are virtually non-existent.
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Subsidies
If subsidies were removed its not the small scale low debt farmers that will be put out of business overnight, its the ones that have borrowed the most (these invariably being the larger or expanding farms).
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Yep, debt is a dangerous thing.
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Production would slump as more and more would go out of business or downsize and within a year production would slump to an all time low across the EU (as all EU farmers recieve subsidies, something you seem to be confused about)[note also that Irish farmers recieve less per acre than many of their European counterparts despite being more productive/efficient per acre].
Then the price of food would not only rise to meet production costs but supply having been diminished it would rise even further.
At anyone time in the year the planet as a whole is only something like 40 days away from complete famine. Thats to say if food production stopped worldwide for 40 days there would be no food left on the planet.
So even small slumps in production can have serious consequences for the pricing of food. For example Ireland is the 4/5 largest exporter of beef in the world. If Irish production alone slumped there would be a huge price jump on the shelves.
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But this kind of disruption already goes on. In many cases, only a small fraction of the supermarket price of food goes to the farmer/supplier.
There was a huge grain price spike a few years back. Most people in Ireland didn't even notice it. Where it was noticed, was in places like Egypt, where they had food riots. The civil unrest and eventual revolution in Egypt, tracked the grain prices. But most people here didn't even notice.
I would say the subsidies do not hugely effect the supermarket price - and if they do, those subsidies are going into the pockets of Tesco. When the grain prices quadrupled, Tesco's bread only went up in price by not more than 50c. Cooking oil matched the bio-diesel price. But still it only went from something like 70c, to a peak of near 2 Euros. And people really didn't notice. Except in Egypt - where many people would only earn enough to eat - and not that well. In Mexico there were food riots. In Haiti, people were reduced to eating pies made of mud.
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I hope I'm explaining this clearly to you because you seem to be of the belief that subsidies are a tax on the urban and a charity to the farming community.
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The whole subsidies business is complicated. For most people I don't think it really worked out.
And probably the way it's working, the supermarkets are gouging the benefit of the subsidies out of the suppliers. To the consumer it may not make a huge difference. If they're price concious they tend to make substitutions. If meat goes up in price - more bread, potatoes and vegetables. But the way Tesco price food, I don't think the prices are near where most people would pay attention.
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If you get what I've just outlined you'd see that what they infact are is charity to the urban. They keep the pricing of food artificially low. They also keep the price of food stable which is possibly even more important.
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I don't think the subsidy is much of a factor in the supermarket price. Tesco relabel their meat products at wildly varying prices - and a lot of the time the only difference in the product is the label. And most people, in the supermarket would not be able to identify the quality of meat by looking at it.
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Yes there are agrifoods industries outside the EU operating without subsidies but only doing so at the expense of
- Animal welfare (ever heard of dead holes/induced labour/the faith of bull calves on New Zealand dairy farms?)
-environmental (deforestation in South America/ huge carbon footprint in Asia)
-quality (use of growth promoters and absolutley no traceability in North America)
-unsustainablity
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I have seen poor animal welfare in Ireland. There's certain parts of the country if you go for a drive, you'll see it pretty quickly.
And the carbon footprint - if no cattle eat the grass, it will die anyway and become carbon dioxide.
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Diversification/Eco-tourism
The irony is you're talking about, on one hand, economies of scale and effeciency, and eco-tourism on the other. The first thing this brilliant large scale progressive farmer you wish for would do is rip up every ditch on his farm and pipe all the open drains destroying natural habitats and our countryside. Then he'd shoot every badger he saw. If you think he wouldnt, again look to New Zealand pasture or US/Eastern European cereal plains.
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We don't have cereal plains in Ireland....Unless someone comes up with a grain that grows in bogs. ....we have bog plains.
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Ramblers and eco-tourism is not the sector you seem to think it is. Granted it is something Ireland does very well but in terms of revenue its not even close to the agrifoods industry in actual or potential income. There just is not the potential there to encourage most farmers or land owners to invest.
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Then they should be given money to invest. Even if the vast majority of projects were complete failures - the successes would pay off. Instead of ghost estates, which were a complete failure.
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Very few farmers are lucky enough to live beside a lake or other attraction. A lot that do, have invested but you must realise that this isnt an option for the vast majority.
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People can be driven around to things.
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Its like saying "4 million tourists visited Dublin last year and you didnt put one up in your flat for the week. Your an idiot, you cant complain about not having enough money, you could have made a fortune"
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If I had room, I would have. And people do put these people up. People are running small B&Bs all over Dublin. Though that eejits built too many hotels things are not as good as they were - there are plenty of people who do part-time B&B.
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As for micropigs, they're pets. They're not bred for food. Its like breeding puppies. Micro-cattle are the same. The market for tender beef is already filled by slaughtering "ordinary" cattle younger.
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What's sold as tender beef in Ireland is rubbish. If there is high quality tender beef being produced, it's definitely not turning up in Tesco.
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As for those who sell straight to the consumer, its a very niche market has taken a serious kicking in the recession. I know of several farms that have reverted to mainstream production because of this. Equally the farmers market/organic sector is in decline both here and across Europe.
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To break the strangle hold of supermarkets over suppliers, niche markets need to be developed - new distribution networks. If you walk into Tesco in Dublin, there's very little choice of product. You have the funny dyed stuff, which could be anything - and then 24 euro Angus steaks in very fancy wrapping. If lamb producers were getting half of what Tesco charge for their product - they'd be riding in stretch limos and smoking big cigars.
And the public are uneducated. Many will think there's something wrong with frozen beef. They think lean beef is good. They don't even know what marbling is.
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As for other industries small scale Irish farmers could diversify into, many do. You seem to be mistaken farm income to total income. If for example a farmer had a puppy breeding enterprise or an eco-tourism business it would not be included in the farm income figures I quoted earlier. In fact its this ingenuity that has allowed most small farm families to make ends meet.
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And money should be thrown at small farmers to try these things.
But not at big farmers to make more funny pink mystery meat for Tesco. I do know a farmer who under the old system used to apply for different grants and get them for the same shed over an over again.
And I know micro-pigs aren't for eating. But if I was producing them...I'm sure there might be people interested in trying one....left over stock and all ...smoked... Though you'd need a separate website to the pets site.