No relief as feed prices stay high

The UK pig industry has called on the EU to speed up the approval process for GM varieties of soya, so UK farmers can compete on an open global market.

The UK pig industry has called on the EU to speed up the approval process for GM varieties of soya, so UK farmers can compete on an open global market.

The calls come in the wake of a report from the UN Food and Agriculture Organisation (FAO). which says feed prices are expected to ease from their recent record peaks, but will remain much higher than they have been over the last decade.

The FAO's latest Agricultural Outlook, prepared in association with the Organisation for Economic Co-operation and Development (OECD), says that drought in some of the world's main grain-producing regions was a large, but transitory factor in the sharp increase in prices over the past two years. More permanent factors - including high oil prices, changing diets, urbanisation, economic growth and expanding populations - are expected to contribute towards sustained higher prices over the next 10 years.

Andrew Knowles, strategy co-ordinator at BPEX, said: "I would certainly agree with the FAO that prices will remain high - we are in a new dawn and cheap food is a thing of the past.

"There has been some easing back in the wheat market and the harvest forecast is promising, but prices are still 100% higher than they were last year. In addition, soya is soaring through the roof, partly due to production and partly due to tension between the EU and the US regarding GM approval."

He believes the number one priority for the EU should be overcoming the issues relating to GM and soya. "If we can unlock that and come to a pragmatic solution, it will help enormously."

Over the next few months, debate among world leaders will centre on how best to combat rising prices. France has argued for EU protectionism, but the FAO and OECD insist that developing countries must be given access to EU markets. Speaking at the Outlook's launch in Paris, OECD secretary-general Angel Gurría said: "The way to address rising food prices is not through protectionism, but to open up agricultural markets and to free up the productive capacity of farmers, who have proven repeatedly that they will respond to market incentives."

In a communication adopted last month, the EU proposed a range of measures to mitigate global food price increases - including CAP health reform, retail monitoring, a sustainable biofuels policy and a continued open trade policy.

On announcing the communication, Commission president José Manuel Barroso called on member states to "give a united European response to this global challenge."

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