Oilseed aid due for a squeeze

6 February 1998




Oilseed aid due for a squeeze

AREA aid balancing payments for oilseed rape growers will be squeezed this spring, after confirmation of an 18% scaleback for English growers and 25% in the Scottish non-LFA.

Aid cuts for over-planting were always expected. The UK as a whole exceeded its maximum guaranteed area (under the 1992 Blair House deal with the US) significantly, triggering 6.62% penalties. (Elsewhere in Europe, Italy faces 10% cuts, with Ireland and France 3% each).

Scottish non-LFA growers are having another 7.1% trimmed for overshooting their arable base area.

But the real surprise is the 11% penalty being applied because EU oilseed prices have exceeded the so-called "world reference price" during the first seven months of the season (Business, Jan 30).

The upshot is that growers, having already received 50% advance aid payments in October, will get substantially smaller cheques in April. These are as follows:

&#8226 English growers, £150.25/ha

&#8226 Scottish non-LFA, £140.56/ha

&#8226 Wales, £153.48/ha

&#8226 Northern Ireland, £142.71/ha.

"The significance of the area penalty is that it is cumulative," says Francis Mordaunt of consultants, Andersons. "If the EU exceeds its MGA again this year, the UK carries forward a 6.6% penalty to add to the 1998 calculation."

Every expectation is that this will happen. Dalgety estimates that the winter rape area is up 10% at 415,000ha (1.025m acres).

And while spring plantings are pencilled in as 5% down, this will have only a small overall impact.


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