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In your field: Tom Clarke - 'Farmers are sitting ducks for suppliers, merchants and processors'

Why are tractors not allowed on the German autobahn? Without speed limits, a trusty tractor just cannot hold its own against gangs of lean, mean BMWs or Audis. Gaggles of tractors bouncing out onto these roads would just be sitting ducks.

Eighteen years ago, I studied at business schools in the UK and the US. The nub of what you learn in business school is that firms thrive, not in a free market, but when they find ways to dam up the laws of economics to create private pools of potential profit which they can defend against competitors.

 

The business of business school is teaching managers how to buck the free market, and a true free market has no big business, no brands and no barriers to entry or exit.

 

All costs, including social costs, are reflected in the price and everyone makes an identical product. Under these conditions, the consumer is king, every producer makes a viable return and resource use is efficient.

 

This setup does not exist except in economics textbooks. But the closest thing in the real world is farming. The trouble is the rest of the economy is playing by business school rules.

 

Farmers are therefore sitting ducks for the agribusiness suppliers, merchants and processors who are all driving without speed limits. That is the main reason we need Government on our side.


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Understandably in an industry where we have such little control, anyone who can sell farmers an illusion of it is onto a winner. That is not to say innovation is all fake, just that marketing is dominant.

 

To show the difference, take the humble sugar beet. Since 2010, yields in the UK have increased by 25 per cent, in large part due to better genetics, a genuine innovation; well done to the breeders.

 

And yet, the 2020 BBRO Recommended List shows 21 standard beet varieties. The yield gap between the top and bottom is 7.5 per cent, but most cluster round the middle.

 

The margin of error for these tables is 4 per cent, so that is a maximum yield difference of 3.5 per cent under test conditions.

 

So why do seed houses spend vast sums on advertising, free gifts and write ups, when beet farmers know a wet autumn or dry spring can wipe 10 times that amount off your theoretical yield. That is marketing.

 

Believing your chosen variety is going to make much difference is buying the illusion of control. It works; every year many beet growers baulk at any hint of availability issues for that year’s chosen pet beet variety.

 

As an industry, we need to focus on what we can control: our farming system, our cropping choices and our business structure, and say ‘no thanks’ to new, go faster stripes.

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