REVEALING THE OPPORTUNITIES FOR GROWING PEAS AND BEANS IN THE UK BY THE ANDERSONS CENTRE FOR THE Report by: The Andersons Centre Graham Redman Old Bell House Partner 2 Nottingham Street Direct: 01664 503 207 Melton Mowbray Mobile: 07968 762 390 Leicestershire Office: 01664 503 200 LE13 1NW E-mail: [email protected] The Andersons Centre The Opportunities of Growing Peas and Beans in the UK March 2015 Contents The Andersons Centre The Opportunities of Growing Peas and Beans in the UK CONTENTS 1 EXECUTIVE SUMMARY ~ THE BENEFITS AND THE FUTURE FOCUS ............................. 1 2 THE OPPORTUNITIES THAT PULSES OFFER .......................................................................... 3 2.1 DEFINITIONS ................................................................................................................................. 3 2.2 WHAT HAS HAPPENED TO PULSE AREAS? .................................................................................... 3 2.3 WHY IT MATTERS......................................................................................................................... 4 2.4 OBJECTIVES OF THIS STUDY ......................................................................................................... 5 2.5 HEALTH BENEFITS ........................................................................................................................ 5 2.6 ENVIRONMENTAL CREDENTIALS .................................................................................................. 5 2.7 STAKEHOLDERS OF THIS STUDY ................................................................................................... 6 3 THE UK PULSE INDUSTRY ............................................................................................................ 7 3.1 PEAS ............................................................................................................................................. 7 3.2 BEANS .......................................................................................................................................... 8 3.3 OTHER PULSES ............................................................................................................................. 9 4 EXPORT AND HOME MARKET OPPORTUNITIES ................................................................ 10 4.1 PROTEIN AVAILABILITY ............................................................................................................. 10 4.2 QUALITY IMPACT ....................................................................................................................... 11 4.3 PEA EXPORTS TO JAPAN AND ELSEWHERE ................................................................................. 11 4.4 BEAN EXPORTS .......................................................................................................................... 12 4.5 WHOLE-CROP ANIMAL FEED ..................................................................................................... 12 4.6 FISH FOOD .................................................................................................................................. 12 4.7 FREE FROM… ............................................................................................................................. 12 4.8 THE UK PEA CONSUMER ............................................................................................................ 13 4.9 BEAN CONSUMPTION .................................................................................................................. 13 4.10 INWARD INVESTMENT ................................................................................................................ 14 4.11 UK SNACK FOOD ENTREPRENEUR ............................................................................................. 14 4.12 CONTROLLING OBESITY ............................................................................................................. 14 4.13 ALTERNATIVE PULSES ................................................................................................................ 14 5 PUBLISHED DATA FOR UK PULSES ......................................................................................... 16 5.1 CROP AREA FIGURES .................................................................................................................. 16 5.2 YIELD DATA ............................................................................................................................... 18 5.3 PULSE CROP SIZE ....................................................................................................................... 19 5.4 PULSE SUPPLY AND DEMAND INFORMATION.............................................................................. 19 5.5 PULSE PRICES ............................................................................................................................. 20 5.6 PROPOSAL FOR PROCESSES TO IMPROVE STATISTICAL RECORDS ............................................... 20 6 GLOBAL SUPPLY AND DEMAND ............................................................................................... 22 6.1 DEMAND .................................................................................................................................... 22 6.2 PRODUCTION .............................................................................................................................. 22 6.3 TRADE ........................................................................................................................................ 23 6.4 PRICES ........................................................................................................................................ 31 6.5 EX-FARM CONTRACTS AVAILABLE ............................................................................................ 31 7 GROWING AND MARKETING PULSES ON FARM ................................................................ 33 March 2015 Contents The Andersons Centre The Opportunities of Growing Peas and Beans in the UK 7.1 WHY DO FARMERS NOT GROW MANY PULSES? ........................................................................ 33 7.2 YIELD ......................................................................................................................................... 33 7.3 QUALITY ~ AFFECTING PRICE IN THE FIELD ............................................................................... 36 7.4 GROSS MARGIN .......................................................................................................................... 40 7.5 GROSS MARGIN ANALYSIS FOR BREAK CROPS .......................................................................... 46 7.6 FARM OVERHEAD COSTS / STRUCTURES .................................................................................... 49 7.7 COMMON AGRICULTURAL POLICY ............................................................................................. 51 7.8 ORGANIC PULSE PRODUCTION ................................................................................................... 52 7.9 BREAK CROP OR CRITICAL PART OF ROTATION? ....................................................................... 52 7.10 THE KNOWLEDGE GAP ............................................................................................................... 53 8 CONCLUSIONS ~ REPAIRING THE MARKET FAILURE ...................................................... 54 8.1 SPECIFIC REQUIREMENTS FOR REPAIRING THE MARKET FAILURE ............................................. 55 9 APPENDICES ................................................................................................................................... 57 9.1 ACKNOWLEDGEMENTS ............................................................................................................... 57 9.2 WORKS CITED ............................................................................................................................ 57 9.3 WHY PULSE AREAS HAVE FALLEN ............................................................................................ 60 9.4 EU POLICY ON GENETICALLY MODIFIED CROPS ........................................................................ 62 9.5 PRICE RELATIONSHIPS WITH OTHER COMBINABLE CROPS ......................................................... 64 9.6 RISK MANAGEMENT ................................................................................................................... 65 9.7 GROSS MARGIN EXAMPLES ........................................................................................................ 66 9.8 AGROCHEMICAL COSTS .............................................................................................................. 67 9.9 WHAT IS A ROTATION AND WHAT IS IT FOR? ............................................................................. 70 9.10 DETAILS OF LOAM FARM MODELLING WORK ............................................................................. 71 9.11 AUTUMN AND WINTER CROPPING .............................................................................................. 74 9.12 LENGTHENING ROTATIONS WITH ADDITIONAL CROP TYPES ...................................................... 77 9.13 DETAIL ON SPREADING OVERHEADS .......................................................................................... 77 Disclaimer We take all reasonable steps to ensure that the information in this report is correct. However, we do not guarantee the report is