§ 1.52 p.m.
§ Mr. Dye (Norfolk, South Western)
The subject to which I wish to call attention is not one of distributing that which is already available but is linked with increasing the production of food in this country, so that greater amounts may become available for rations. A large number of agriculturists in the Eastern counties have been dismayed at the recent announcement of the price of beet pulp. As a farmer, I am naturally directly interested. I grow sugar beet and I also endeavour, I hope successfully, to fatten cattle. However, I am certainly not raising the matter in my own interest but in the interests of the agricultural community, particularly of the Eastern counties.
The growing of sugar beet, the fattening of cattle and the production of milk by 2509 feeding, amongst other foods, beet pulp to the cows plays a very big part in our agricultural economy in the Eastern counties. Not only are the farmers as such interested in this problem but so also are the workers, because the introduction of sugar beet growing in the Eastern counties has increased the amount of time in the year in which the workers are engaged on piece-work rather than on day-work rates. In hoeing and lifting sugar beet the workers are engaged several months of the year mostly at piece-work rates, and that brings them in a good deal more than the minimum wage. The workers must therefore be interested in the amount of income which the farmers draw from their sugar beet crop.
The point I wish to make is that in spite of the increased contract price of sugar beet which the farmers will receive in 1949, their actual income from the crop will be very much less than in 1948. That is a very important statement to make, and it is true. If that can be established, the Ministry of Food and the Ministry of Agriculture jointly should be willing to reconsider the situation. I agree that it arises out of the statement made by the Minister of Agriculture in this House on 24th January when he indicated that the price of feedingstuffs would be raised. If there had been a proportionate increase over all our feedingstuffs, there would have been no outcry against it in Norfolk and the other Eastern counties, but a disproportionate increase has fallen on the price of beet pulp charged to the growers and it appears to them that they are bearing an undue weight of the increased cost of feedingstuffs.
From an agricultural point of view, England is divided into two. On the Eastern side we are the tillers of the soil, the arable farmers, and that is our greatest asset. Since we have been growing sugar beet to the present extent, it has been a very important part of our crop rotation and of the income which the farmers receive. On the Western side of the country the principal crop is grass. The more it rains, the more grass they get, provided that they manage their pastures right. Therefore, the cost of feeding their animals has not gone up to anything like the extent of the cost of feeding cattle on crops which require 2510 increased labour and where the prices of the other feedingstuffs required have also been raised.
I want to ask my right hon. Friend to reconsider in a friendly sort of way if he can, with his right hon. Friend the Minister of Agriculture, the question of the price which the grower will be charged for his beet pulp during the current year. It is very unfortunate that the actual price which he will be charged was not announced at the time he entered into his contract for growing sugar beet. The price announced by the British Sugar Corporation was £5 3s. 4d. a ton for clean beet of a 15½ per cent. sugar content delivered to the factory. So far so good—that is an increase of 1s. 9d. a ton to the grower—but the grower has always had the option of purchasing back a quantity of beet pulp. Last year the price at which he could purchase back his beet pulp was £6 12s. 6d. a ton, and that would be the price he had in mind when signing his contract for growing sugar beet in the current year. However, having signed his contract and agreed to an acreage, he suddenly gets the announcement that he will be charged £14 a ton for beet pulp. That is more than double the previous price. He is therefore in the difficulty that he does not get a cheque for the beet which he delivers to the factory because the cost of pulp supplied to him is deducted. The grower is, therefore, concerned with the actual amount which he receives.
Perhaps I may go into the figures a little more closely. There may be something wrong with my arithmetic which I do not guarantee to be perfect but, as I have said, the contract price for sugar beet shows an increase of 1s. 9d. a ton. Last year most of our farmers produced 10 tons of sugar beet to the acre, so assuming that the crop is about the same in 1949, the increase per acre for his crop will be 17s. 6d. to meet the increased costs of production. For each ton of beet delivered the grower has the option to purchase back from the British Sugar Corporation 1½ cwts. of dried pulp, which is equal to 15 cwts. of pulp to the acre if the crop produces 10 tons to the acre.
If the pulp is charged to the grower at £14 a ton, that will mean the equivalent of £5 8s. 0d. an acre, so that if one deducts the increase which he will receive 2511 for his sugar beet, 17s. 6d. per acre, it will be found that the farmer will receive £4 10s. 6d. less for every acre of sugar beet that he grows this year as compared with last year, assuming that he exercises his option of purchasing the same amount of pulp as he was able to get last year. For instance, if one takes the county of Norfolk—where the Minister of Agriculture has indicated that contracts have been signed for roughly 95,000 acres this year—assuming that the farmers of that county exercise their option of buying back pulp, they will receive £429,875 less for their crop this year than in 1948. No doubt the answer from the Ministry will be, "But if the farmer takes pulp back and feeds it to his cattle, he will get an increased price for those cattle." So far so good, if the increase in the price of fat cattle is big enough to cover the increased price of the pulp, but is it?
From my experience, I find that I can fatten one bullock for every acre of sugar beet that I grow by the bullock consuming the tops and the pulp and other foods in addition. The average increase in the price of fat cattle is 4s. 6d. per live cwt. Therefore, a 12 cwt. bullock will bring in £2 14s. more in 1949 than in 1948. If, therefore, the farmer feeds his pulp to fatten cattle at the rate of one bullock per acre, he receives in the price for his sugar beet and the price for his fattened bullock, on an average still £1 16s. 6d. less for every acre of sugar beet that he grows. In growing sugar beet he has other increased costs, including wages, so that if we are to combine the increased production of fat cattle in the Eastern counties with maintaining the acreage of sugar beet, as we want to do, the farmers will be that much worse off as a result of the recent review of feedingstuffs.
It will not be as profitable this year as it was last year, and I do not think there have been many complaints that in recent years the work of growing sugar beet and fattening cattle has been over profitable. Certainly I remember the time when we grew sugar beet at 35s. a ton delivered to the factory. That was something akin to slavery. I also remember the time when we sold our cattle for very low prices indeed, when a good fat bullock would produce little more than £20, whereas now a similar bullock will bring in £80. I am not wanting to go back 2512 to anything like that, and I am not wanting to upset the system of reviewing agricultural prices and giving a guarantee. My point is that in the review that has taken place, because of the alterations in prices, those who are farming in the Eastern Counties are called upon to bear a disproportionate share of the increased cost of feedingstuffs.
One of the things we want to safeguard is the fertility of our soil. Therefore, it is important that as much as possible of the crop we grow should be fed to animals on the farms so that it goes back on to the land in the form of manure and thus maintains the fertility. If, however, we charge the grower a higher price for his pulp, he will be discouraged from having more stock on his farm and there will be a smaller production of meat. That is an important aspect of the problem, namely, that the farmers of the Eastern counties will not be able to maintain the same stock as in previous years and, although we want a better balance between stock and crops, they will be encouraged to grow sugar beet and barley and other crops and sell them instead of grazing cattle or sheep on their farms.
That is not all. The average increase in the price of fat cattle may be 4s. 6d. but the review indicates that the larger fat cattle will carry a much reduced price in future. There is to be a reduction of 5s. per live cwt. on those over 13¾ cwt. up to 15¾ cwt. and then a reduction of 10s. a cwt. A farmer in Norfolk during this past month sent 10 fat bullocks to the market which averaged a ton apiece, that is, 10 tons of live beef. If he does the same thing about the same time next year, he will get £100 less for his animals. We have not solved the meat problem in this country. Our rations are at their lowest. Therefore, this is not the time to discourage farmers from producing as much as they can and encouraging the slaughtering of the animals at too young an age and at too small a weight. Those two things combined, therefore, will discourage and make more difficult the production of meat in the Eastern counties.
I ask that the Ministers of Food and Agriculture should get together to see whether they can either alter the price of beet pulp to the growers, or make a revision of the prices of fat cattle delivered to markets during the months of March, April and May. These are the cattle 2513 which have been fed upon the pulp or other crops which the farmers have grown and which cost more to produce than bullocks which are fed from the springtime onwards. This is an important matter for the farmers of the Eastern counties and I ask, in a friendly way, that the Ministers concerned should look at it again with a view to solving the problem I have outlined.
§ 2.11 p.m.
§ Mr. Joynson-Hicks (Chichester)
I had hoped to join in the earlier Debate but unfortunately I was unavoidably detained elsewhere. I am particularly glad, therefore, of the opportunity of supporting the argument of the hon. Member for South-Western Norfolk (Mr. Dye) on the question of sugar beet pulp and fat cattle. So far as fat cattle are concerned, I agree wholeheartedly that the sooner we can get back to being allowed economically to produce cattle of one-ton weight the better. I understand that the real objection to our doing so at present is not an agricultural or an economic one, but is the objection of the butcher that he cannot cut the present rations out of a one-ton animal. It follows, therefore, that if we were allowed to produce economically a one-ton animal the right hon. Gentleman the Minister of Food would be giving us bigger meat rations all round. On the desirability of that object hon. Members on all sides will agree.
I should like to refer to one or two of the points made by the hon. Member for South-Western Norfolk. We can go a little further than he did in his objection to the date at which the announcement of the price of sugar beet pulp was made. I have little doubt that the right hon. Gentleman will reply to this argument by saying that it was perfectly fair to all farmers, because they were given the opportunity of withdrawing their contracts which they had already entered into but that none of the farmers did withdraw and, consequently, they were quite prepared to accept the increased price for sugar beet pulp which they had to buy back again.
The answer to that is that it is well known in farming that farming is a planning job. Farmers plan their farms well ahead; they plan the operations which they are to carry out during the course of the year. If, having planted his farm in order to produce, say, 10 acres of sugar beet, the farmer is suddenly confronted 2514 with this increase in price for sugar beet pulp and is given the opportunity of withdrawing from his contract for the production of the beet, it is almost inevitable that he would say, "I must accept the increased price for sugar beet pulp because at this late stage of operations I cannot economically re-organise the whole of my planning for the farm. Even if I did so I could not produce an alternative source of feedingstuffs for my animals during the coming autumn and winter to replace the sugar beet tops and pulp. "It does not follow, therefore, that because farmers did not withdraw their contracts for the production of sugar beet they are not being hit very heavily indeed by the increase in sugar beet pulp prices.
I agree also with the hon. Gentleman's arguments about the profitability of the production side of sugar beet. As he pointed out, the increase in the contract price is insignificant, and works out at about 17s. 6d. per acre. The increase in the cost of production is due not only to the big increase in wages, which alone is vastly more than the increase in the contract price of sugar beet, but particularly to the increase in cost of machinery, replacements and overheads.
In the assessment of those figures at the annual price reviews, insufficient con sideration is given to that aspect. The farmer is perpetually and continually struggling to build up his working capital on the farm. As soon as he thinks he has a sufficient profit from one thing or another to enable him to set aside a sum for improving his working machinery and so on, which will enable him to increase the efficiency and economy of his work, it is straight away taken from him either by taxation or by a reduction in price, or in some other direction. He never gets into the position of being able to catch up with himself financially and economically. I hope that the right hon. Gentleman will bear all this in mind.
I believe that the reason for the increase in price of sugar beet pulp is because sugar beet factories are unable to run economically and have said to the Government, "You must either increase our subsidy or enable us to make more money." The way in which they make more money is by the sale of their sugar beet pulp. As I understand the situation, the Government are not prepared to increase the subsidy to the factories. What it amounts to, therefore, without going 2515 into technicalities or economics, is that the farmer is being asked to subsidise the production of sugar for the benefit of the consumer. The right hon. Gentleman may smile, but if he pauses to reflect he will find that that is basically true. I agree with the figures which the hon. Member for South-Western Norfolk has produced. But the farmer does not get back the whole of the increase in price. He may recover about 50 per cent. of it, but beyond that figure the increased price is an indirect subsidy by him to the consumer.
If the right hon. Gentleman and his colleagues had accepted the advice we have given them for years past, and if they had responded to our call to increase the number of beet sugar factories, they would have done a very great deal, both economically and productively, for the sugar industry and for the farmer. I do not believe that the Ministry of Food appreciate the value of sugar beet to the farmer. It is true that on the basis of the previous figures, many farmers were prepared to grow sugar beet purely for the benefit of farming, irrespective of the value of the sugar to the factory. If farmers were prepared to do that, it stands to reason that a substantial amount of increased production is available for the benefit of the industry.
I hope that when the right hon. Gentleman considers the economics of this matter he will appreciate the need for improved transport facilities and for shortening the haul of beet in order to reduce transport costs and congestion. I hope that he will consider sympathetically the plea regarding the price of pulp, for this is a matter which hits the farmer very hard. He has no alternative source of feedingstuffs to which he can turn. He is being encouraged to grow the maximum amount of food for animal consumption so that he can increase the production of meat, but at the same time he is faced with the immediate problem that the price to him of one of his staple commodities is increased by over 100 per cent.
§ 2.20 p.m.
§ Major Wise (King's Lynn)
I wish to support my hon. Friend the Member for South-West Norfolk (Mr. Dye) in the case he has made. We in Norfolk are extremely perturbed about this matter. A 2516 moment ago I was pleading for the farm workers and now I wish to plead for Norfolk farmers. We produce an enormous quantity of sugar beet and it seems extraordinary that we who are engaged in farming should be asked to pay twice as much for our home products as we paid last year. The price of pulp has increased by more than 100 per cent. When I used to grow sugar beet in the Midlands, it was always recognised that pulp was a by-product and that it came back to us at very low prices. Now circumstances have altered, and I want to deal with the question in relation to beef production.
I know hundreds of thousands of acres in Norfolk where there are no head of livestock on the farms and it is certain that, with the increase in the price of feedingstuffs, the production of beef in Norfolk will fall. The loss to the farmer of beef cattle by the increase in the cost of feedingstuffs is between £6 and £7 a head. In a market that I know, last year about 3,500 head of stock came through to the Ministry of Food at weights up to 16 cwt. and more. The loss to the farmers on those cattle will be no less than £21,000 this year. In an area such as this £21,000 is a big sum and it will be lost locally, either in the shops or among wage-earners in the district. I think the Minister should consider revising the prices for this product. It is essential that we should produce these animals in Norfolk and that we should have the manure they provide. If we are handicapped by the prices we have to pay for the residue of our product, I am certain that beef production in Norfolk will tend to lessen even to a larger extent than in the last three years.
§ 2.24 p.m.
§ The Minister of Food (Mr. Strachey)
An interesting and highly technical point has been raised by my hon. Friend the Member for South-West Norfolk (Mr. Dye). There is a series of interlocking issues following on the recent price review agreed to, according to calculations of the Ministry of Agriculture, the National Farmers' Union and independent experts, whereby the prices paid to farmers for livestock products were raised a little more than enough to compensate them for the increase in prices of feeding-stuffs, whereas on the other hand the price paid for milk was raised a little less 2517 than the increase in feedingstuffs. There was a perceptible but not a precipitate switch away from that towards these livestock products. That calculation, which of course is not mine, but was the agreed calculation upon which the price review was undertaken and to which the National Farmers' Union subscribed, included the increase in the price of all feedingstuffs, of which sugar beet pulp is one.
I did not quite follow the calculation of my hon. Friend. I can see that the farmer loses on his sugar beet if we regard him merely as a sugar-beet producer, but the price was made intentionally and I should have thought the National Farmers' Union could have been trusted not to subscribe to the proposition unless it were true that he would be a little more compensated by the increase he was given, not as a producer of sugar beet, but as a producer of the livestock product to which it went. That was the intention. It is open to my hon. Friend or to anyone to say that while that proposition might be true in regard to all these things, the price of sugar beet pulp has been raised disproportionately to the price of other products.
This is a most technical matter and I am advised that the ratio of price increases of the various feedingstuffs was calculated on what is called starch equivalent. It is a difficult thing to compare because we not only have to consider the calorie value but the protein value as well. The experts claim that they get somewhere near to it by taking the starch equivalent and they maintain that they did not penalise sugar beet but only increased the price in fair ratio compared with the prices of other feedingstuffs.
§ Mr. Strachey
That is their stoutly maintained view. The farmer cannot have it both ways and have the price of his end product, his livestock, substantially and appreciably increased without also having to pay more for his feedingstuffs. My hon. Friend argues that this particular feedingstuff was hard hit as compared with other feedingstuffs, but that is stoutly disputed by the experts, and we are bound to accept their advice that the sugar beet feedingstuff has not 2518 been put out of line with the other feedingstuffs.
On the related point about which both my hon. Friends and the hon. Member for Chichester (Mr. Joynson-Hicks) spoke in regard to the end product, the fat livestock, it is perfectly true, as they say, that the very fat beast has been penalised in price by this change in comparison with the leaner beast. There again it is the Ministry of Agriculture's advisers who are primarily concerned in this matter. Their view is that more meat is obtained per ton of feedingstuffs of all sorts available, if there are relatively more lean cattle and relatively fewer very fat cattle. If the available feedingstuffs are used in fattening up to a certain point more lean beasts, and those cattle are not carried beyond a certain point, one gains as against putting one's feedingstuffs into fewer but fatter animals. That is why they have quite frankly and advisedly altered their price inducements so that it pays the farmer to kill his cattle when they reach a certain degree of fatness, and not fatten them beyond that point.
Granted that their advice is correct, I should have thought that that was the right thing to do. I should not have thought it mattered to the farmer practically one way or the other if it was made relatively more profitable to produce more leaner beasts instead of fewer but fatter beasts. I should have thought that it would be just the same to the farmer. If we are right that that gives us a better conversion value for our feedingstuffs it is an obvious and real gain to the consumer. That seems to me to be a question of fact.
§ Mr. Dye
Surely it depends on the type of feedingstuffs available to the farmer? With the coarser types of feedingstuffs available to most farmers it is better to rear stock to a larger size than to attempt to fatten them at an earlier age. It would require a much bigger quantity of concentrated feedingstuffs with a high protein content to be available all over the country for the farmers to produce a smaller weight bullock of good quality.
§ Mr. Strachey
That may be so, but our advisers take the view that even with the feedingstuffs available today we get more meat per ton of feedingstuffs if the beasts are not fattened beyond that particular point.
As I was saying, that is a question of fact. I should have thought that it would 2519 be very interesting if we got the Agricultural Research Council or one of the other authoritative bodies to pronounce on the question, if the Council has not up to now pronounced upon it, as I understand it has not. The object is to get more rationable meat per ton of feedingstuffs, and we think that that is attained by putting the inducement on more lean rather than fewer fat cattle. That is a question of scientific fact. It would be interesting to hear the view of the Agricultural Research Council on the matter, taking into account the type of feedingstuffs available.