Uncertainty over Brexit hits ForFarmers’ UK feed sales in first half
- Credit: ForFarmers-
“Great uncertainty” in the UK about the consequences of Brexit has hit animal feed sales, according to ForFarmers.
The Dutch-owned animal feed firm, which has its UK headquarters, opened earlier this year, in Bury St Edmunds, saw a “solid” first half due to growth in sales on the continent, with feed volumes up across the Netherlands, Belgium and Germany.
But UK sales saw a dip, particularly among cattle farmers.
Chief executive Yoram Knoop said overall customers were in better financial shape than a year ago, when milk and pig prices were under pressure, and on the continent were once again increasing production.
But he added: “There is large uncertainty in the United Kingdom about the consequences of Brexit for the agricultural sector.
“Farmers are therefore more hesitant in, among others, growing the size of their herds, which were reduced last year. In spite of this, the market in the United Kingdom appears to be recovering slowly.”
Total Feed volume fell in the United Kingdom by 3.9% to 1.5 million tonnes. Meanwhile, overall, feed volumes were up 3.6% to 4.7m tonnes and overall net revenue increased by 3.7% to 1.1bn euros.
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However, the firm detected “first signs of recovery in the UK agricultural sector”, while acknowledging that the short-term forecast was still uncertain. “There is great uncertainty about the consequences of Brexit for the agricultural sector in the United Kingdom,” said the feed farm, which moved its base from Ipswich to Bury St Edmunds this year. “This is why ruminant and swine farmers are reticent to, among others, recover their herd sizes, which were reduced last year. In spite of this, the British market appears to be recovering slowly.”
The uncertainty of UK farmers regarding Brexit meant particularly cattle farmers were not focusing on optimising feed production and continued to buy lower-value feed, it said, while the recovery of cattle and swine herd sizes was taking longer than expected.
Gross profit in the UK fell by 17.2%, and the weak pound meant a negative currency change effect of 9.1%. Competition in the swine feed sector increased as businesses consolidated into fewer hands, ForFarmers said.