Appeal Court backs ownership of R&D trials data

Court backs ownership of R&D trials data

A recent Appeal Court decision should benefit agrochemical companies carrying out R&D, as it confirms that the costs they incur in generating specific data to support the authorisation and re-authorisation of their products means the data belongs to them and is protected. 

slug - chiltern.jpg

The implication of the decision is that companies now have greater protection in relation to commercially sensitive field monitoring data, which would otherwise allow competitors to bring their products to market without first having to conduct their own such studies. 

The case was brought by Co Durham-based distributor Chiltern Farm Chemicals against the Health and Safety Executive, which oversees the Chemicals Regulation Division (CRD). It related to the re-authorisation of Chiltern's 1.5% TR3799 metaldehyde slug pellet brand, specifically the data collected in field monitoring studies involving the tagging of birds.  Such ‘vertebrate studies’ are exempted from CRD data protection and so could be used for the benefit of other companies without the data owner's consent.

 The Court of Appeal was asked to determine what constitutes a ‘vertebrate study’ under the relevant EU legislation and unanimously decided Chiltern's study was not a vertebrate study.

“This case is important to us and our business,” states Chiltern director Philip Tavener. “These studies are time consuming and costly, and the distinction between what constitutes a vertebrate study or not has considerable commercial implications.  

“The data we generate are commercially sensitive and it is right and fair that in non-vertebrate studies we are allowed to properly negotiate our competitors' access to those data.”

Simon Fitzpatrick, a partner in the Commercial Litigation team at Boodle Hatfield, the London law firm that led the case, adds: “This is a complicated and technical area of law relating to what is and what isn’t a vertebrate study and subsequently what happens to data submitted in support of authorisation of agrochemicals.  

“Quite rightly, the Health and Safety Executive’s (HSE) Chemicals Regulation Division (CRD) wishes to minimise the impact on wildlife of all studies and it does this by requiring agrochemical companies to share data from certain studies involving vertebrates.  The regulations also grant businesses protection to commercially sensitive data, and this case has for the first time provided valuable clarification of where the line should be drawn.”

Boodle Hatfield says the case is an important decision, as it is the first time the English courts have considered the definition of a vertebrate study.  Its remit will extend across the whole range of plant protection products and monitoring studies in the context of re-authorisation applications to secure the data protection rights of data owners in these studies.

Case facts provided by Boodle Hatfield

The CRD is responsible for regulating plant protection products in the UK.  Pesticide producers are required to apply to the CRD for authorisation prior to marketing their products in the UK.  Once authorised, products are periodically required to be reviewed and re-authorised.

Chiltern, a producer of slug pellets, applied for the re-authorisation of its products in the UK.  The extensive data submitted by Chiltern in support of its applications included a bird field monitoring study, involving the standard application of Chiltern's slug pellets to agricultural sites followed by the monitoring of radio tagged birds which happened to be present at those sites.  No effects on any birds were observed.

Studies submitted to the CRD are generally afforded data protection and cannot be used for the benefit of other companies without the data owner's consent, subject to specific exceptions.  One such exception is vertebrate studies, where the regulations seek to avoid duplication of studies that may cause harm to vertebrates.  Tagging for identification purposes is excluded from the definition of a vertebrate study as is "recognised agricultural practice".

Vertebrate studies can be used by the CRD for other applicants if they have requested access from the data owner but have not received the data owner's consent.  The data owner then has a claim for “a fair share of the costs” from the applicant.                                                 

The CRD considered that Chiltern's bird field monitoring study was a vertebrate study and that it could be used for the benefit of other applicants without Chiltern's consent.  CRD's reasoning for the decision was, they alleged, that the study's overall purpose was to determine if metaldehyde (the active substance in Chiltern's slug pellets) kills birds or results in clinical or behavioural effects.

Chiltern brought proceedings for judicial review of this decision.  It was common ground between the parties that the radio tagging of the birds did not cause the study to be a vertebrate study.

Court of Appeal's decision

The Court of Appeal unanimously held that Chiltern's study was not a vertebrate study.

In coming to its conclusion, the Court considered that the study was excluded from the definition because of the express exclusion for recognised agricultural practice.  It was common ground between the parties that the use to which Chiltern's slug pellets were put in the study was recognised agricultural practice.  The pellets had been applied by farmers to agricultural fields at the authorised application rate.

The Court further considered that it would be curious if the monitoring of an authorised plant protection product used in accordance with its authorised directions was prohibited if similar monitoring had been performed before, or if it required a licence to be performed (vertebrate studies are required to be licensed prior to the work being carried out).

Finally, the Court concluded that the study did not increase the risk to birds over and above that inherent in the use of the product during the course of authorised and recognised agricultural practice, given the modest size of the experimental area compared with the area over which authorised metaldehyde products were used in farming.  Therefore, the interference with Chiltern's property and confidentiality rights in the study would have been disproportionate.


This case is an important decision, being the first time the English courts have considered the definition of a vertebrate study.  Its remit will extend across the whole range of plant protection products and monitoring studies in the context of re-authorisation applications to secure the data protection rights of data owners in these studies.

It was considered and accepted that if the study had involved monitoring the effects of a new unauthorised product or the new use of an existing product, that would have been experimental and within the definition of a vertebrate study.  A trials permit from CRD would have been required for such a study in any event.

The decision clarifies that monitoring studies, where the form of monitoring does not itself cross the threshold for a vertebrate study, may be duplicated.  This can only increase the protection of vertebrate wildlife, with numerous studies able to be carried out.


Posted on March 8, 2018 .

Chiltern Farm Chemicals vs the Health and Safety Executive


Neutral Citation Number: [2018] EWCA Civ 271

Case No: C1/2017/3219





[2017] EWHC 2491 (Admin)

Royal Courts of Justice

Strand, London, WC2A 2LL


Date: 27/02/18

Before :








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Between :









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Tim Ward QC and Robert Palmer (instructed by Boodle Hatfield LLP)

for the Appellant

Jonathan Lewis (instructed by Government Legal Department) for the Respondent


Hearing date: 6 February 2018

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Approved Judgment





Lord Justice Hickinbottom:



1.                  The Respondent, through its Chemicals Regulation Division (“the CRD”), has responsibility for regulating “plant protection products” including molluscicides, and is the competent authority for the United Kingdom under Regulation (EC) No 1107/2009 of the European Parliament and Council concerning the placing of plant protection products on the market (“the Regulation”).   

2.                  The Appellant (“Chiltern”) has produced and marketed molluscicides in the form of slug pellets for commercial and domestic use for many years, having been authorised to do so under the predecessors to the Regulation.  Under the Regulation, which has more stringent safety requirements, Chiltern was required to apply to the CRD for re-authorisation of those products.  As part of its dossier in support of that application, it submitted a bird field monitoring study, which it considered provided data necessary to obtain re-authorisation (“the Prosser Study”).  In the study, its slug pellets were applied to several fields in different locations in accordance with its authorisation, and in a standard manner, and adverse effects on tagged birds were noted.

3.                  Generally, the Regulation acknowledges that data obtained and thus owned by applicants as a result of studies, which often involve heavy expenditure, should be protected.  However, it encourages applicants to cooperate and share tests and study reports; and, in respect of vertebrate animals, where agreement over such cooperation cannot be achieved, article 62 allows the competent authority to use test and study reports for the purposes of another applicant’s application, in return for that other applicant paying a fair share of the costs of the tests or study.  Although the data are not shared, the benefit of the data is.  These are known as the data sharing provisions. 

4.                  On 29 January 2016, the CRD notified Chiltern that it considered the Prosser Study to be a vertebrate study that was subject to the data sharing provisions.

5.                  Chiltern, for which the decision had potentially substantial commercial consequences, commenced judicial review proceedings challenging that determination.  Permission to proceed was granted; but following the substantive hearing, on 25 October 2017, His Honour Judge Saffman sitting as a Deputy High Court Judge refused the claim. 

6.                  On 22 December 2017, Jackson LJ granted permission to appeal.  On 12 January 2018, having been informed that several other applications would be considered by the end of February 2018 in respect of which the CRD will or may use the Prosser Study data thereby making the appeal empty, I ordered the appeal be expedited. 

7.                  Before us, Tim Ward QC and Robert Palmer appeared for the Appellant, and Jonathan Lewis for the Respondent.  At the outset, I thank each of them for his contribution to the debate.

The Law

8.                  The marketing of molluscicides has been regulated in the United Kingdom since the Control of Pesticides Regulations 1986 (SI 1986 No 1510); and, since 1991, by provisions emanating from Europe.  EC Council Directive No 91/414/EEC (“the Directive”) and, since 14 June 2011, the Regulation have had the aim of harmonising the arrangements for the marketing authorisation of plant protection products within the EU and of ensuring they are safe to use.  Recital (8) of the Regulation sets out its purpose “to ensure a high level of protection of both human and animal health and the environment and at the same time to safeguard the competitiveness of Community agriculture”.  Recital (10) states that substances used in such products “are not expected to have any harmful effect on human or animal health…”, with recital (24) saying that, prior to granting authorisation, it should be demonstrated that plant protection products “do not have any harmful effect on human or animal health…”.  Therefore, whilst recital (39) stresses the importance of generally protecting the property rights in test and study reports submitted by an applicant for the purposes of the authorisation of a product – so as to stimulate research – recital (40) requires rules to be laid down to avoid duplication of tests and studies on vertebrate animals.

9.                  Chapter 5 of the Regulation deals with “Data protection and data sharing”.  Reflecting important property and confidentiality rights, article 59 provides that, if they are necessary for authorisation purposes and are certified as compliant with good laboratory or experimental practice, test and study reports concerning a plant protection product and any active ingredients shall have the benefit of data protection for ten years.  That is subject to a number of exceptions, but the only relevant exception for the purposes of this appeal is that found in article 62. 

10.              Article 60 requires Member States to keep a list of test and study reports submitted and necessary for any authorisation process; and article 61 requires that list to be provided upon request to anyone intending to seek an authorisation of a plant protection product.  Article 61(3) requires the relevant authorisation holder and prospective applicant to take all reasonable steps to share relevant data; but without a mechanism to require them to do so.

11.              However, under article 62, where those parties fail to reach an agreement in respect of test and study reports on vertebrate animals, the competent authority can override the lack of consent, and, although it does not allow the data to be disclosed to the new applicant, it allows the authority to use the reports when considering a new application.  Where it does so, article 62(6) entitles the authorisation holder, whose data they are, to claim from the new applicant “a fair share of the costs incurred by him” in obtaining the data (which, of course, may fall short of the value that the data may have to the new applicant).  In the meantime, article 62(2) proscribes Member States from accepting duplicate vertebrate tests and studies. 

12.              These are the only provisions that allow the non-consensual use of an authorisation holder’s data for the purposes of an application by another person; and they only apply to test and study reports on vertebrates.  “Test and study reports on vertebrate animals” is a phrase not defined in the Regulation.  However, recital (40) refers to the restriction of tests on vertebrate animals being “in accordance with Council Directive 86/609/EEC of 24 November 1986 on the approximation of laws, regulations and administrative provisions of the Member States regarding the protection of animals used for experimental and other scientific purposes” (“the 1986 Directive”).  This is confirmed in the CRD publication “The Applicant Guide: The Protection of Data” (“the CRD Guidance to Applicants”).  Furthermore, each of two European Commission Health and Consumer Protection Directorate guidance documents, European Commission Guidance Document on Data Protection (SANCO/12576/2012 rev 1.1) and European Commission Questions and Answers on the Regulation (SANCO/12415/2013 rev 6), state that:

“The terms ‘tests and studies involving vertebrate animals’ should be interpreted as experiments within the scope of [the 1986 Directive]…”.

It is common ground before us that “test and study reports on vertebrate animals” for the purposes of the Regulation has the same meaning as “experiments” under the 1986 Directive. 

13.              So far as material to this appeal, article 2 of the 1986 Directive defines “experiment” as:

“… [A]ny use of an animal for experimental or other scientific purposes which may cause it pain, suffering, distress or lasting harm…  [A]n experiment starts when an animal is first prepared for use and ends when no further observations are to be made for that experiment….  Non-experimental, agricultural or clinical veterinary practices are excluded.”

14.              I pause to note that the 1986 Directive has been superseded by EU Directive 2010/63/EU on the protection of animals used for scientific purposes; but (i) the 1986 Directive regime applies in this case and (ii) it is common ground that there would be no material difference in the outcome under the 2010 Directive in any event.  I need not consider the 2010 Directive further.

15.              The 1986 Directive was implemented in the United Kingdom by the Animals (Scientific Procedures) Act 1986 (“the 1986 Act”); and it is also common ground that sections 1 and 2 of that Act properly implemented the 1986 Directive by defining “a regulatory procedure” in terms that are directly equivalent to “experiment” in the Directive (and, thus, to “test and studies on vertebrate animals” in the Regulation). 

16.              Section 1(1) of the 1986 Act defines “protected animal” as:

“Any living vertebrate other than man.”

17.              Section 2, so far as material to this appeal, provides:

“(1)   Subject to the provision of this section, “a regulated procedure” for the purposes of this Act means any experimental or other scientific procedure applied to a protected animal which may have the effect of causing that animal pain, suffering, distress or lasting harm.

(5)     The ringing, tagging or marking of an animal, or the application of any other humane procedure for the sole purpose of enabling an animal to be identified, is not a regulated procedure if it causes only momentary pain or distress and no lasting harm.

(8)     In this section references to a scientific procedure do not include references to any recognised veterinary, agricultural or animal husbandry practice.”

18.              Two points are worthy of note at this stage.

i)                    It is clear from section 2(1) that “experimental procedure” is simply a subset of “scientific procedure”.

ii)                  The exception incorporated into article 2 of the 1986 Directive, in respect of “non-experimental, agricultural or clinical veterinary practices” is not easy to construe on its face, because (a) the comma suggests that “non-experimental” does not govern “agricultural practice” and “animal husbandry practice”, and (b) it otherwise purports to define an exception to “experiment” in terms of itself, i.e. “non-experimental”.  However, before us, it is common ground that section 2(8) of the 1986 Act properly implemented the exception, and I can therefore focus exclusively on section 2(8) without referring back to the 1986 Directive.

19.              Section 3 of the 1986 Act prohibits any person from applying a regulated procedure unless linked personal, project and premises licences are in place.  Contravention of section 3 is a criminal offence, with a maximum sentence on conviction of two years’ imprisonment (section 22(1)).

The Risk Assessment Methodology

20.              The relevant European methodology for the assessment of the risk of morbidity effect of plant protection products on vertebrates is set out in The European Food Safety Authority Guidance on the Risk Assessment for Birds and Mammals (EFSA Journal 2009; 7(12); 1438).  It is helpfully, and uncontroversially, set out in the statement of Peter John Chapman dated 14 July 2017, from paragraph 10 onwards.  Mr Chapman is the Director of Regulatory Affairs at JSC International Limited, consultants used by Chiltern. 

21.              The approach is two-tiered.  The first step is a paper-based screening assessment, comprising a calculation based upon various worst-case assumptions, which are unrealistic in relation to normal conditions of use, e.g. that birds spend all their foraging time eating metaldehyde-containing slug pellets and they eat nothing else.  If that calculation shows there is no risk, then no further steps are undertaken.  However, if it shows a potential risk, then, if the calculation cannot be refined to exclude the risk, “higher tier data” are required from (e.g.) studies designed to assess the effects of the product on birds and mammals under field conditions.  The purpose of such data is to show that, under particular conditions of use, the product is acceptably safe.   

The Factual Background

22.              The factual background is comprehensively set out in the judgment of Judge Saffman.  I can be relatively brief.

23.              Chiltern was established in 1980, and since then it has manufactured slug pellets with the active substance metaldehyde in a cereal-based formulation.  The pellets are spread over the surface of the soil.  When ingested by slugs, they are fatal.  However, the toxic properties of metaldehyde mean that, in certain circumstances, the pellets can also be harmful and even fatal to birds and small animals, to which they are a potential food source.

24.              Under the Directive, authorisation was required before placing a plant protection product on the market.  There were two stages to the process.  First, active substances (such as metaldehyde) had to be approved.  Approved substances were added to Annex 1 of the Directive which triggered a requirement for any plant protection products containing that substance already on the market to be re-authorised.  During this process, plant protection products containing those ingredients could continue to be marketed. 

25.              The review of metaldehyde started in 2003.  It was concluded, and metaldehyde included in Annex 1, on 1 June 2011.  However, as I have indicated, the Regulation came into effect on 14 June 2011, with higher safety standards particularly in relation to minimising harm to vertebrate animals.  Upon the advent of the Regulation, Chiltern’s products containing metaldehyde had to be re-authorised on the basis of the new standards, including those within article 62 of the Regulation.

26.              Although the products had been marketed for some years, Chiltern was aware that, if its applications were to be successful, it would need further data in respect of their safety in relation to small wildlife.  The first-tier safety assessment did not rule out the possibility of the products posing a risk to birds and mammals.  Higher tier data were therefore required.  Chiltern commissioned six ecotoxicology studies, including two field monitoring studies, one on mammals and one on birds.  The collection of the data for the purposes of the applications for re-authorisation cost Chiltern about £3m, the Prosser Study alone costing £174,100.

27.              The two monitoring studies were commissioned by Chiltern from the Centre for Chemical Safety and Stewardship within the Food and Environmental Research Agency (“FERA”), then an executive agency of the Department for Environment, Food and Rural Affairs.  When the studies were initiated, FERA sought and obtained the necessary licences for the mammal study (which involved tagging by punching a hole in the ear of the subject animals), but not the bird study.  The director for the bird study was Dr Phil Prosser, hence “the Prosser Study”. 

28.              The Prosser Study was higher tier.  It involved the tagging of wild birds which happened to be present at the five sites that were the subject of the study, prior to seed drilling and a single slug pellet application.  That application was at the recommended rate employing standard equipment normally used for the purpose; and then observation of the birds over a fixed period.  It was the express aim of the study to adopt “normal agricultural practice in slug pellet application”; and, in Dr Prosser’s opinion, that aim was achieved (see paragraph 3.3 of the Prosser Study).  Before Judge Saffman, it was common ground that the slug pellets were distributed and otherwise used both as authorised at the time and in accordance with “standard”, “normal” and (for the purposes of the 1986 Act) “recognised” agricultural practice.  The Prosser Study was completed in April 2014.  It was certified as being compliant with the relevant national and European standards of good laboratory practice.

29.              Five other manufacturers of plant protection products containing metaldehyde proposed to apply for the re-authorisation of their products, and they asked the CRD for a list of vertebrate studies already submitted in other applications for metaldehyde-containing products.  They were provided with a list, which included the Prosser Study. 

30.              On 30 October 2015, Chiltern’s solicitors wrote to the CRD asking whether they considered the Prosser Study fell within or outside the data sharing provisions; and, if within, on what basis.  The CRD responded on 29 January 2016, indicating that they did consider the Prosser Study was subject to the data sharing provisions, giving two reasons. 

31.              First, it said that the study harmed the birds because “it involves the handling trapping and radio tagging of wild birds unfamiliar with that process”.  However, before the application was heard by Judge Saffman, the CRD had accepted that the tagging etc involved in this case did not trigger the data sharing provisions, because it fell within section 2(5) of the 1986 Act (see paragraph 17 above).  It has not since been suggested that this reason had any force.

32.              The second reason was as follows:

“… [T]he overall purpose of the study was to determine if metaldehyde kills birds or results in clinical/behavioural effects. The objective has the potential to cause overall suffering and ultimate harm. The symptoms of metaldehyde poisoning in domesticated and wild mammals includes inability to stand, blindness, change in respiratory rate, excessive sweating and salivation, sudden death and seizures. [The CRD] considers that the minimum threshold is also reached in relation to this study which we therefore deem to be in scope of the vertebrate data sharing arrangements as outlined in [the Regulation]”.

Before Judge Saffman, and now before this court, that was and is the only reason relied upon by the CRD for the data sharing provisions applying to data derived from the Prosser Study.

The Claim

33.              The Prosser Study recognised that Chiltern’s products posed a risk to birds by consuming the slug pellets directly or by consuming slugs contaminated with metaldehyde from the pellets.  Before Judge Saffman, as I have indicated, the CRD accepted that the study involved the use of Chiltern’s slug pellets in accordance with “recognised agricultural practice”; but, it was contended, it became a “regulated procedure”, subject to the data sharing provisions, because of the subjective intention or motive underlying the use.  It was submitted that there is a material difference between, on the one hand, merely obtaining feedback from farmers who, in the ordinary course of their farming, have used the slug pellets in the field in accordance with the product’s authorisation and recognised agricultural practice, and then simply observed what happens; and applying slug pellets in exactly the same way, but for experimental or other scientific purposes.   In the Prosser Study, the purpose of applying the pellets was experimental, namely to measure the risk of harm to birds.  The study therefore fell within the definition of “regulated procedure” for the purposes of the 1986 Act.

34.              It was submitted by Mr Ward, appearing for Chiltern before Judge Saffman as he did before us, that neither the product nor its manner of use in the Prosser Study was experimental.  He accepted that, had the Prosser Study been conducted with a new, unauthorised product, then it would have been a recognised procedure under the 1986 Act.  But the product was authorised, it had been applied to the relevant sites in accordance with standard agricultural practice, and is likely to have been applied in that way at those sites in any event.  Recognised agricultural practice did not become experimental simply because there was subsequent monitoring of the bird population. 

35.              Judge Saffman accepted that the data sharing provisions of article 62 of the Regulation were an exception to, and a derogation from, the general principle of data protection in respect of studies; so that article 62 had to be construed narrowly.  However, for the purposes of the scope of “recognised procedure” in the 1986 Act, he did not consider that the use of an authorised product could be distinguished from the use of a new product.  He accepted, as was common ground, that the pellets in the study were applied as in recognised agricultural practice; but the unambiguous motive behind the application here (i.e. to obtain data about the risk posed to birds, under the auspices of a scientist) meant that “it was not in pursuance of standard agricultural practice” (see [113]).  He concluded, at [119] of his judgment, that he did not see how the Prosser Study was “anything other than a scientific study of the birds”, being “a study of the effect (if any) of the pellets on birds conducted under the supervision of a scientist, which was monitored by a scientist and which contains a Statement of Compliance with Good Laboratory Practice”.  In short, he preferred the submissions made on behalf of the CRD.         


36.              As will by now be apparent, this appeal turns upon a narrow point of statutory construction concerning the scope of “regulated procedure” for the purposes of section 2 of the 1986 Act, and particularly whether the use to which the plant protection product was put in the Prosser Study fell within that scope.

37.              The primary definition of “regulated procedure” is found in section 2(1), i.e. “any experimental or other scientific procedure applied to a protected animal which may have the effect of causing that animal pain, suffering, distress or lasting harm”.  In my view, the use to which the product was put in the Prosser Study clearly fell within that definition.  As Mr Lewis submitted, “experiment” includes a scientific procedure undertaken to make a discovery, test a hypothesis or demonstrate a known fact.  The premise upon which the Prosser Study was conducted was that “there may be risks to birds both from directly consuming slug pellets, and from consuming contaminated slugs and other invertebrates”, i.e. risks identified by a paper calculation as a first-tier assessment.  The study was higher tier, designed to provide data that would assist in the assessment of that risk.  Chiltern no doubt considered that, if used in accordance with its authorisation and standard agricultural practice, the product will not harm birds; but, at the very least, the study was designed to test that hypothesis.  In determining whether this use to which the product was put in the Prosser Study fell within that primary definition, purpose was therefore relevant.

38.              However, this definition of “regulated procedure” in section 2(1) is expressly “subject to the provision of this section”, including section 2(8).  Section 2(8) provides that “references to scientific procedure do not include references to any recognised… agricultural… practice”.  Mr Ward for Chiltern submitted that that exclusion from the primary definition does not, expressly or impliedly, incorporate any element of intention or purpose.  I agree.  Where, as here, the use of the product was a “recognised agricultural practice”, it falls within the exception.  An enquiry as to whether the use was part of a scientific procedure, rather than in “the ordinary course of farming”, was neither required nor warranted.  Judge Saffman correctly proceeded on the agreed basis that the use of the product was in accordance with recognised agricultural practice; but, in my respectful view, he then erred in proceeding to consider the purpose or motive for that use, and, having found that the purpose or motive was in pursuance of a scientific procedure, in concluding that it was a recognised procedure attracting the data sharing provisions of article 62.

39.              In coming to that conclusion, I have particularly taken into account the following.

40.              It was common ground before Judge Saffman that the use to which the slug pellets was put in the Prosser Study was a recognised agricultural practice.  Before us, Mr Lewis fleetingly sought to suggest that, on the facts of this case, it was not; but that was a point not taken before Judge Saffman and, rightly, not ultimately pursued by Mr Lewis before us.  The appeal therefore proceeded on the basis of the same consensus as there was below.

41.              Judge Saffman concluded that the article 62 data sharing provisions are a derogation from the general rule of data protection in article 59, and therefore the article 62 should be interpreted strictly.  That conclusion is not the subject of any challenge before this court.  However, I am unconvinced that it is either helpful or necessary to rely on the principle of derogation in construing article 62.  It is unnecessary because, in my view, the true construction of article 62 is unambiguous. 

42.              The construction suggested by Mr Lewis, and adopted by Judge Saffman, would define “scientific procedure” in terms that exclude any “recognised agricultural practice” but except from that exclusion any scientific procedure.  It would thus define an exception to “scientific purpose” in terms of itself, which would rob section 2(8) of all sensible content.  I am unconvinced that that is a legitimate construction, even though, on one view, it is arguable that the 1986 Directive defines “experiment” in terms of itself (see paragraph 18(ii) above). 

43.              On the basis of the construction Mr Lewis suggests, section 2(8) would, at best, be merely confirmation for the avoidance of doubt that “scientific procedure” in section 2(1) excludes recognised agricultural etc practices that are not part of any scientific procedure.  I am unconvinced that section 2(8) was intended to have no substantive content: indeed, it was clearly intended to have some purpose.  Its purpose was to exclude any recognised use of the product that fell within agricultural etc practice from the definition of “regulated procedure”, irrespective of the purpose or motive of that use.       

44.              It seems to me that that construction is both unambiguous, and entirely consistent with the aims of the Regulation.  It is true that the Regulation enhanced the protection of vertebrates, with the recited aim of ensuring that no marketed plant protection product has harmful effects on animal health (see recitals (10) and (24), referred to in paragraph 8 above).  However, all plant protection products pose some risk.  Metaldehyde-containing products are required to be toxic to slugs and, dependent upon distribution/dose and other circumstances of use, pose some risk to vertebrate animals, including birds.  The balance between the benefits of plant protection products and the risk to vertebrates is set out in article 62 read with the 1986 Directive as implemented in the 1986 Act.  It is that which defines the margin of safety. 

45.              The concept of “recognised agricultural practice” within this part of the scheme is driven by the directions for use as authorised, the appropriate regulator assessing whether that risk is acceptable.  Where a plant protection product is used in accordance with recognised agricultural practice, it is being used in circumstances in which the risk is currently considered to be acceptable.  

46.              It would be curious if monitoring an authorised plant protection product used in accordance with the authorised directions and usual, recognised agricultural practice either was prohibited (insofar as similar monitoring had been done before), or alternatively required a licence to perform.  There would appear to be no justification for discouraging such practice.  In my view, such monitoring is allowed without any such requirement.

47.              Mr Lewis submitted that, once a specific product has been assessed as “safe” and consequently authorised, absent a change in standards, it is unlikely to benefit from further studies (paragraph 42 of his skeleton argument).  However, I do not agree.  Even where, on available material, a product has been assessed as safe when used in accordance with certain directions, when it is marketed it will be the subject of much greater usage in a much wider range of circumstances than can have occurred prior to authorisation.  Problems that were not apparent previously may therefore exhibit themselves after marketing.  Anecdotal reports may be inadequate to identify such problems.  A responsible authorised person may therefore take the view that monitoring in accordance with authorised use will be beneficial.  Where safety standards are raised, data from monitoring a product when it was subject to lower standards may still be helpful.  For example, if a standard of safety is raised from X to Y, it will be helpful if monitoring against standard X shows that the product meets standard Y in any event.  Simply because re-authorisation of a product will be assessed by higher safety standards than currently apply, does not change the scope of current recognised agricultural practice on which monitoring can be conducted.  The results of the re-authorisation process may, of course, change recognised agricultural practice; but that is a different matter.

48.              I do not accept Mr Lewis’s submission that, by using a plant protection product in accordance with recognised agricultural procedure but for the purpose of scientific monitoring, the risk to vertebrates is materially increased, because any risk is not counterbalanced by any benefit in terms of plant protection.  Even if the application of the product to the fields that were the subject of the study had not been as part of active farming, the increase in risk was insignificant, given the very modest size of the experimental area monitored in the Prosser Study compared with the area spread with authorised metaldehyde-containing products as part of farming (over 700,000 hectares).  But, in any event, the sites used in the Prosser Study were particularly selected as being due to be drilled with rape seed or cereal (see paragraph 2.6 of the Prosser Study); and, as part of the study protocol, the sites were in fact seed drilled prior to pellet application and monitoring.  For obvious reasons, a field without being seed drilled would have been less attractive to birds, and may have thus biased the results.  Mr Lewis’s criticism therefore has no force on the facts of this case. 

49.              The Prosser Study did not increase the risk to birds over and above that inherent in the use of the product during the course of authorised and recognised agricultural practice.  That risk has been assessed as being acceptable; and is not made unacceptable by the prospect of a raising of that standard by the new provisions of the Regulation.  Therefore, the interference with Chiltern’s property and confidentiality rights in the Prosser Study data inherent in any data sharing would necessarily have been disproportionate, and indeed unreasonable in the sense of legally perverse. 

50.              The various guidance that has been issued in relation to the Regulation is not of any real assistance.  SANCO/12576/2012 rev 1.1 (which, with the other relevant guidance documents, is referred to in paragraph 12 above) unhelpfully says that “in the case of monitoring of birds and mammals in the fields, it is not very clear whether these constitute ‘tests and studies involving vertebrate animals’”.  SANCO/12415/2013 rev 6 makes no reference to the issue.  The CRD Guidance to Applicants states:

“Recital 40 of [the Regulation] refers to [the 1986 Directive], which in turn defines the type of experiments that are covered by the vertebrate data sharing arrangements.  On this basis, CRD consider that field monitoring data (e.g. such as that conducted for higher tier bird and mammal assessments) are not within the scope of the vertebrate data sharing arrangements.” (emphasis in the original).

Mr Lewis submitted that the reference to field monitoring studies was directed at situations in which animals are not exposed to potentially unsafe products but are simply monitored in their normal habitat to observe their everyday behaviour; but that cannot be so, because the reference to higher tier assessments presupposes exposure to the relevant product.  Nevertheless, I accept that the CRD view of the scope of section 2 of the 1986 Act is not relevant to the true construction of the provision, which is a matter for the objective determination of the court; although it comes as some comfort that the CRD has considered the construction I favour to be correct, as did FERA (then an executive agency of the Department for Environment, Food and Rural Affairs), which did not seek a licence for the Prosser Study on the basis that it was not a regulated procedure for the purposes of section 2 of the 1986 Act.  We were told that, with regard to the scope of “experiments”, a different view of the construction of the 1986 Directive has been taken in Austria, but, without any indication of the basis upon which a different interpretation has been accepted, that does not seem to me to be of any assistance either.  It is not suggested that the German version of the relevant European provisions sheds light on its proper interpretation.  For the reasons I have given, I consider the English version to be unambiguous.


51.              For those reasons, subject to the submissions of the parties as to the precise terms of the order, I would allow this appeal, quash the order of Judge Saffman and quash the determination of the CRD dated 29 January 2016 that the Prosser Study is a vertebrate study to which the data sharing provisions of article 62 of the Regulation apply.

Lord Justice Leggatt:

52.              I agree.

The Senior President of Tribunals:

53.              I also agree.

Posted on March 8, 2018 .

Top SQP from Mole Country Stores

The animal health sector recognised the top Suitably Qualified Persons (SQPs) at the Animal Health Distributors Association’s annual conference dinner held at the Hilton Metropole Hotel near Birmingham last week.

The three candidates achieving the highest scores in the Animal Medicines Training and Regulatory Authority (AMTRA)’s professional examinations last year were Robyn Brown of Mole Country Stores in Billingshurst, Sussex; Nadia Leal of the Animal Medicine Chest at Flagg Court Pharmacy in South Shields on Tyneside and Emma Woolgar of the Byker branch of Pets at Home in Newcastle.

 Robyn Brown and Gaynor Hillier

Robyn Brown and Gaynor Hillier

As the top all-species SQP, Ms Brown collected the Simon Fleet Cup and a cheque for £300 from Andrew Wylie of sponsor Zoetis, as well as the AHDA Cup for the best overall student from Gaynor Hillier of sponsor Elanco.

 She completed national diplomas in animal care and agriculture before going on to take a degree in agriculture at Harper Adams University. She is currently stock supervisor at the Billingshurst branch of Mole Country Stores. “I believe it is important to let people know that there is more to the medicine counter than just selling medicines,” notes Ms Brown. ”As an SQP with an agricultural degree, I feel I have lots to offer from health plans and FECs to grassland management and nutrition.

 “Achieving SQP status has made me more of a ‘complete package’ - I enjoy an advisory role and hope it will open up more doorways into different experiences and career progression.”

 Nadia Leal and Stephen Neale of sponsor Battles

Nadia Leal and Stephen Neale of sponsor Battles

Ms Leal won the Battles Cup and a cheque for £150 as the winner of the best equine and companion animal SQP, with the AMTRA Cup for best companion animal SQP going to Ms Woolgar plus £300 from sponsor Merial.

“We are delighted to recognise the achievements of these three outstanding students,” comments, AMTRA secretary general Stephen Dawson. “It is testament to their dedication and hard work, and really reflects the commitment that we see across of all of the SQP students on our courses, as well as the businesses that support them.”

“They join almost 7,000 SQPs working across the equine, farming and companion animal sectors. These qualified professionals offer free and impartial advice on issues such as resistance; responsible use of wormers and other medicines; and general animal health and welfare. Through their professional advice on responsible use, SQPs support industry-wide efforts to keep animal medicines effective into the future,” he concludes.


Posted on January 31, 2018 .

Countrywide sells its last trading asset

Countrywide Farmers has announced a two month delay in completing the divestment of its stores chain to Mole Valley Farmers (MVF), while it has also sold its LPG fuels business which effectively leaves Countrywide with no trading assets.

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The Countrywide board agreed to sell the Retail division to MVF in late October, subject to review by the Competition and Markets Authority, with completion scheduled to occur before the end of January 2018. But, with the agreement of MVF, completion is now not expected until March 16th this year in order to “enable competition review work to be progressed”.

With the Retail division gone, Countrywide had originally had intended to focus on its Rural Energy and Turf & Amenity businesses (Direct Sales) that reported an operating profit of £2.49m on revenues of £17.96m in 2016.  But it has now agreed to sell the trade and assets of its LPG business to DCC plc, the €12.25 billion Dublin-based fuels to healthcare group, for £28.75 million. This deal should complete by the end of March.

The board had also previously announced a decision to “wind down and transfer the Turf & Amenity business to an alternative provider,” although in the event the business was discontinued in November, rather than being sold as an ongoing concern.

The latest disposals leave the business with just its freehold property portfolio and associated rental income. The business is now being managed by former chief finance officer Julie Wirth, who succeeds chief executive John Hardman this week.

Countrywide Farmers was formed in 1999 through the merger of West Midlands Farmers (WMF) and Midland Shires Farmers, although both businesses had been significant consolidators over the preceding century since their formation in Worcestershire in the early 1900s.

It grew to record revenues of £306 million in the year ended May 31st 2013, before a strategic decision in late 2014 to sell its Agricultural activities – feed distribution, grain marketing and arable input sales – as it lacked the scale to compete with larger companies in the sector. It also meant the company could concentrate on its higher margin Retail and Direct Sales businesses in line with an ambition to seek an Alternative Investment Market listing.

However, a series of subsequent Retail losses, attributed to reduced farmer spending, competitive trading conditions and the difficult and delayed implementation of a new £6m retail IT infrastructure to replace a number of legacy systems, prompted the board to seek a buyer for the Retail division in May 2017.

 “We are delighted to have reached an agreement with DCC plc to acquire our LPG business,” comments Ms Wirth. “This represents an excellent opportunity for the Countrywide LPG brand to continue to grow and flourish within a leading international sales, marketing and support services group which already has a strong LPG division operating in nine countries across Europe.

Managing director of DCC LPG Henry Cubbon adds: “We are delighted to welcome the Countrywide Rural Energy – LPG team to the DCC business and look forward to continuing to develop the Countrywide LPG brand into the future.”

Posted on January 31, 2018 .

New role for CWF chief

Outgoing Countrywide Farmers chief executive John Hardman has a new position following his resignation from the company after 32 years in the wake of its sale of the Countrywide retail store chain to Mole Valley Farmers.

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He is taking on NFU Mutual agency in Marlborough, Wiltshire as senior partner. “This role is an unbelievably close match to my future objectives, and I am really excited about running my own business in the farming/insurance sector,” he says. “Alongside this new role, I intend to extend my non-executive director work.”

Mr Hardman started his career at the West of England Farmers supplies co-operative in 1985, which merged with West Midlands Farmers (WMF) four years later. He was appointed Agri Director of WMF Limited in 1997, becoming Director of Agri Sales for Countrywide Farmers on its formation through the merger of WMF and Midland Shires Farmers in 1999.

Subsequent promotions saw him appointed as Countrywide’s deputy managing director in 2003 and managing director in June 2004. Mr Hardman is also a non-executive director of United Farmers, the procurement business operating on behalf of a group of co-operative members.

Posted on January 31, 2018 .

Cefetra acquires Premium Crops

Cefetra has increased its capacity to procure UK grains and oilseeds through its agreement to acquire Premium Crops from Technology Crops International (TCI), subject to completion conditions. Financial details have not been disclosed.

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Premium Crops, based in Hambledon, Hampshire, was established in 2001 by two former Robin Appel executives, Nigel Bazeley and Edward Willmott, to specialise in alternative combinable crops such as linseed and HEAR rapeseed. As well as the core oilseeds, it has since built a portfolio of specialist cereals including canary seed, millet, naked oats and red wheat. The business reported a £23.3 million turnover in the year ended September 30th 2016.

In 2014, the business was bought by TCI, the US-based alternative crops company formed by Andrew Hebard, who started his career with Allied Grain and its Kings subsidiary, now part of Frontier Agriculture. That led to the UK TCI operation in Braintree being merged into Premium Crops with Andrew Probert as managing director of the combined business.

Mr Hebard says the divestment strategically aligns with TCI’s investment plans for its Natures Crops operating business unit in the UK (headquartered in York) and North America, focussing on developing the growing ahiflower crop and end use market. “Natures Crops is a vertically integrated natural products business - from soil to oil - and this is the basis of our longer term strategy for investment, as opposed to more traditional agricultural merchanting,” he explains.

Cefetra trades over 4 million tonnes of feed materials in the UK each year. It has been part of the €15.4 billion German multinational BayWa Group since 2012, and is active across Northern and Central Europe. In 2015, Cefetra UK acquired the Wessex Grain co-operative based in Somerset, now trading as Cefetra Wessex, and opened an office in Norfolk as Cefetra Anglia last year.

The latest deal further enhances Cefetra’s capabilities to purchase grains and oilseeds direct from UK farmers, says its managing director Andrew Mackay. “We will be able to further diversify our portfolio in the speciality markets offering both the farmers in the UK and our customers across Europe an even wider range of products and services.

“We believe the acquisition of Premium Crops will allow us to add value to the services we can offer to our customers, both growers and end users alike. We are thrilled to partner with a dynamic team that has such a great depth of expertise - the combined business is set to become the commanding force in speciality crops in the UK.”

Mr Probert adds that the Premium Crops board was looking to take the business to the next level. “Negotiations started about 18 months ago, when we were aware that Cefetra was looking to diversify its business. It was the obvious partner, providing access to significantly greater resources; enabling us to offer our growers an unbeatable range of cropping options with outstanding agronomic support and unrivalled access to premium crop contracts; all backed by one of UK agriculture’s strongest businesses.

“Speciality crops provide growers a way to differentiate their products, adding value whilst reducing their risks,” Mr Probert continues. “Demand for these crops is growing across multiple industries and we believe these premium crops represent a small yet key component of the future of a diversified and specialised arable agricultural market globally. Cefetra will enhance our ability to identify new market opportunities and increase the availability of genetics, whilst giving us a greater presence on farm.”

The Premium Crops business will continue to operate from its existing base, maintaining its name and staff. “On an operational level, we fully expect this change to be invisible for our suppliers and customers,” concludes Mr Probert. 

Posted on January 31, 2018 .

Gove: BPS to be phased out over five years

Last week’s Oxford Farming Conference was dominated by Michael Gove’s elaboration of his green Brexit vision and the need for change, which was well trailed in the national press.

Gove’s wide ranging speech set Brexit against the wider challenge of meeting the needs of a growing world population; unprecedented technological change, especially in digital communications, artificial intelligence and biotechnology; and the need to protect the environment and natural capital upon which all economic activity ultimately depends.

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“If we want to preserve that which we cherish – a thriving agriculture sector, a healthy rural economy, beautiful landscapes, rich habitats for wildlife a just society and fair economy – then we need to be able to shape change rather than resist it. We should be seeking to cultivate the resources, policies and people that will allow us to adapt, evolve and embrace change as an ally,” he said.

On Brexit and a new British agricultural policy, he made it clear that the days of state support based on land ownership are numbered – this has “increased land values and inhibited innovation while entrenching lower productivity”.

Defra is seeking to ensure more British food is specified in public procurement contracts, as one measure among “new methods of providing financial support for farmers which move away from subsidies for the inefficient to a model of public money for public goods”.

Mr Gove reiterated the government’s manifesto pledge to maintain current BPS funding levels until 2022. He envisages a further transition period for England – not the devolved administrations that will set their own policies – reported in the national press as maintaining BPS until at least 2024. But within this timeframe, BPS payments would be capped, although cross compliance conditions would be less onerous. ”The guaranteed income should provide time for farmers to change their business model if necessary, help to make the investment necessary for any adjustments and prepare for the future. We will also look at ways to support farmers who may to choose to leave the industry.

“After the transition, we will replace BPS with a system of public money for public goods – particularly environmental enhancement, productivity enhancement, reforming land-based education and bringing research work and farm practice close together.”

Mr Gove promised a new policy emphasis on the whole food chain – not just production, but recognising the relationship between food and the economy, public health and the natural environment.

He also pledged to reduce the bureaucracy associated with RPA and Countryside Stewardship schemes, saying that application forms should take no longer than a working day to complete. There would be a more integrated farm inspection scheme, based on risk assessment rather than box ticking.

Turning to post Brexit trade, Mr Gove said he is “confident of building a new economic partnership with the EU that guarantees tariff-free access for agri-food goods across each other’s borders,” while pursuing new trade opportunities outside Europe.

At the same time, “It would be foolish of us to lower animal welfare or environmental standards in any trade deal. We will succeed in the global market because we are competing at the top of the value chain, not trying to win a race to the bottom.” Mr Gove added that food labelling should reflect how farmers score on issues such as soil health and animal welfare.

Questioned on glyphosate, Mr Gove recognised the active as an invaluable tool to help systems that enhance soil health, and agreed that there should be a more science and risk-based way to regulate pesticides. While stopping short of endorsing GM technology, he said the priority must be soil health, so no new technologies that can help this should be ruled out. Future policy must not be ruled by past debates, and we should be open to the benefits of promising new technologies such as gene editing.

Speaking on the same platform, Paolo de Castro, MEP, vice chairman of the European Parliament’s agriculture committee, said that Brexit was much less of a priority in the EU than the UK. He believed that Brexit would cost the EU budget around €10 billion year - €3bn les for the CAP – half of which it will recoup through higher charges on the 27 member states and 50% through cost cutting from the new 7 year budget starting in 2021.

Meanwhile, the CAP will continue to evolve, with further simplification and an increased emphasis on risk-management.

On future UK trade with the EU, Mr de Castro noted that the agrifood chain is highly integrated across the EU, so Brexit will cause some disruption. A trade deal is possible, but the timetable is very tight, he warned. The current EU Budget period ends on 31.12.2020, so any transition period would have to finish then too.

Conference presentations can be viewed via the webpage.

Posted on January 31, 2018 .

Comment: Gove can’t have it both ways

The Brexit negotiations have reached a point where the vague promises of the Leave campaign have met reality, not least on the Irish border question. But Defra minister Michael Gove still appears to believe he can “have his cake and eat it” with high UK production standards and deregulation to allow more competitive food imports.


A hard Brexiteer, he has recently told the dairy industry to expect no migrant labour after the UK leaves Europe. He is also reported, alongside on/off friend Boris Johnson, to have written to Theresa May pressing for more deregulation and free trade with the rest of the world.

Despite this, his recent speeches have painted a pastoral vision of high UK environmental standards and animal welfare, unsupported by primary production subsidy. Mr Gove appears to believe that the UK can recoup its higher production costs by marketing these higher standards around the world under a Made in Britain label.

While this may help highly branded products such as malt whiskies and niche sectors such as organic cheese, provenance will be much less help to the commodity markets.

A former Conservative agriculture minister, John Gummer, introduced the UK’s unilateral ban on sow stalls. It came into effect in 1999, 14 years ahead of similar action in the EU. At the time, Mr Gummer assured pig producers that the British consumer would support higher welfare produce. The reality, of course, is that consumers buy on price. The UK sow herd has more than halved since the stalls ban leading to higher volumes of pigmeat imports, much of it produced in conditions illegal in the UK.

Many believe the emphasis on environment and animal welfare is a Conservative strategy to reconnect with the younger voters that deserted the party in the last General Election. It will be interesting to see how much traction higher UK food production standards have in mainstream global markets outside the EU, and how Mr Gove balances his green credentials with his Brexiteer desire for deregulation.

Posted on December 5, 2017 .

AF index measures 5% farm input inflation

AF logo large.jpg

The average cost of agricultural inputs increased by 4.92% over the year to September 2017, through a combination of higher fuel prices and the devaluation of sterling after the June 2016 referendum in the UK. The company measures price inflation across the £230 million of annual purchases it makes on behalf of farmer members.

The AF Group’s AgInflation Index records an 11.5% increase in fuel costs during the period with the rising cost of Brent Crude Oil plus the weakening of sterling against the US dollar in the first half of the year.

But all product categories measured by the index were affected by price inflation. There was an 8.7% rise in fertiliser costs; 7.3% for seed; 8.5% in contract and hire charges and 1% for animal feed and health products. Crop protection products increased by 0.9% over the whole year, despite a -0.28% fall in the first six months of the period.

“Fuel is the primary driver in this latest AF AgInflation Index,” comments AF Group chief executive Jon Duffy. “In the 12 months to September 2017, Brent Crude Oil increased from $46/barrel to $55.9/barrel. Couple this with an initial devaluation in the $/£ exchange rate from 1.31 to 1.25 between September 2016 and February 2017 - although the past six months has seen the exchange rate strengthen to 1.33 in September 2017. All in, the global fuel market remains volatile, with the ever-changing cost of Brent Crude Oil and the fluctuating exchange rate.”

AF fertiliser & seed business manager Chris Haydock adds: “The seed rises are down to the increase in grain prices, while the strength of the euro and the dollar means I can’t see fertilizer prices reducing in the short term. Importers of ammonium nitrate have struggled and further increases are expected. Granular urea values have risen, with potash and phosphate prices around £15/tonne higher over the season so far.”

Fuel price inflation means arable enterprises have seen a higher rate of cost growth than the livestock ones. The index shows cereal and oilseed rape production costs rose by 5.75%, sugar beet by 4.63% and potatoes by 2.72%. Dairy farmers saw their costs rice by 3.77% (2.78% in the six months to February 2017) with beef and lamb producers 3.42%.  

The AF AgInflation Index also shows a Retail Price Index increase of 2.2%, less than half the rate of increase for farm inputs. But while bread and margarine prices fell 5%, that of granulated sugar rose by 11.5%.





Posted on December 5, 2017 .

United Oilseeds estimates 7% rise in OSR plantings

Farmer-controlled United Oilseeds is forecasting a 7% increase in the UK winter oilseed rape crop, the first increase for five years.


Based on its seed sales and a survey of its farmer members, the co-operative estimates that 602,783 hectares have been planted for harvest 2018, which is 7.07% up on Defra’s figure of 563,000ha harvested in 2017.

This would be the first area increase since 2012 when the crop peaked at 758,000ha - it has steadily declined over subsequent years. As well as the national increase, it is encouraging to see increases in the Eastern and South Eastern regions that have suffered the most from increased insect pest problems at establishment, exacerbated by the loss of crop protection actives, says UO managing director Chris Baldwin.

The business estimates the average 2017 OSR yield at 3.87 tonnes/ha, the highest since the 3.99t/ha achieved in 2011, which equates to a total UK 2017 crop output of 2.18 million tonnes. Applying a five-year mean yield of 3.5t/ha to the 2018 planting figure points to a 2.11m tonnes crop, Mr Baldwin notes.

Certified seed sales are up by 8.89% to 471,000ha in autumn 2017, comprising 175,500ha of conventional varieties (+10.9%) and 295,800ha of hybrids (+7.7%). Farm Saved Seed accounts for the remaining 130,000ha, or a 21% market share.

 This points to a 40% area share for hybrids, 37.23% for conventionals and 5.57% for HOLL and 5.12% for HEAR types. But the biggest growth - 97% - is in the Clearfield system varieties that now account for 12.13% of the UK area. 

Posted on December 5, 2017 .

Countrywide chief to resign after MVF stores sale

Countrywide Farmers has confirmed the sale of its rural retail operation to Mole Valley Farmers, subject to regulatory clearance, and the resignation of its chief executive John Hardman.

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The business revealed in early October that it was in exclusive discussions with Mole Valley Farmers over the sale of its 53 country stores. This followed the April board announcement that potential divestment was being explored following a second consecutive full year loss, partly due to ongoing delays in installing a new IT platform across the retail business.


MVF has agreed to acquire 48 of Countrywide’s current 53 stores plus the online business and IT operating systems. The 750 employees across the stores, in the distribution function and at head office are expected to transfer following an appropriate consultation process. The final price will depend on stock levels at completion, which is expected in January 2018. Countrywide will retain all the freehold properties, with Mole Valley leasing these premises.

The five stores not included in the deal - Amesbury, Glastonbury, Honiton, Towcester and Wenvoe are to close. Countrywide had already closed 14 of its less profitable stores in a cost saving measure ahead of the decision to divest.

The deal effectively doubles the MVF store network to 100 outlets – it has 52 branches under the Mole Valley Farmers and Mole Valley Country Stores fascias, plus four operating under legacy brands. These generated £195.3 million in 2016, with the Countrywide chain making £116m in the year to November 30th 2016.

Countrywide has also sold its 80% stake in the Market Harborough-based MSF Welland Valley Feeds retail store to its management for £1m, and is Ltd and is transferring its Turf & Amenity business to an unnamed buyer. This leaves it with the Rural Energy - LPG business, supplying bulk LPG and bottled gas to commercial and rural domestic customers, in addition to its property interests.  Rural Energy – LPG and Turf & Amenity comprise Countrywide’s Direct Sales division which made an operating profit of £2.5m on revenues of £18m in 2016.  

“We are delighted to have reached an agreement with Mole Valley Farmers,” says Countrywide chief executive John Hardman. “This represents an excellent opportunity to secure the future of our Retail business with an established sector leading company. I would like to thank all of our staff who work within the Retail business and have remained committed through a significant period of change and uncertainty. We are very grateful for their contribution and wish them all the very best for the future.”

For MVF, chief executive Andrew Jackson adds: “We very much look forward to welcoming and integrating the Countrywide Retail team into the company. My perception is that the staff have remained loyal and focussed on maintaining business performance despite uncertainty about their futures, which is a commendable measure of their stamina and commitment to the business and customers alike.”

● Following these changes the Countrywide board has reviewed the future company structure and agreed “substantial changes to the chief executive role.  As a result, Mr Hardman is to resign from the company in January. Chief financial officer Julie Wirth will act as interim chief executive. Mr Hardman has worked for the business for 32 years.

Posted on December 5, 2017 .

New boss at ForFarmers UK

The UK’s largest feed manufacturer, ForFarmers, has appointed Steven Read as chief operating officer (COO) for the UK business from January 1st 2018.

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He succeeds Iain Gardner, COO at ForFarmers UK and a member of the Group Executive Committee for the Netherlands-based co-operative, who is retiring after 29 years with the company.

Mr Read, who has worked at the business for 31 years, is also a member of the ForFarmers Group Executive Committee. He assumed his current Lochem HQ-based role of supply chain director in June 2016, with responsibility for purchasing, formulation, and manufacturing & logistics.

“Steven is the natural and logical person to be appointed COO of ForFarmers UK, given his broad experience and successful implementation of changes in the ForFarmers organisation,” says group chief executive Yoram Knoop, “and the fact that he has previously been part of the UK senior management team for many years.”

Mr Gardner has led ForFarmers UK since the Dutch group acquired BOCM Pauls in July 2012, when he first joined the group executive committee. At the time of the acquisition the agreement was made that Iain Gardner would step down at an appropriate time. The UK arm has now been rebranded under ForFarmers colours with a new central administrative office and HQ opened near Bury St Edmunds in June.

 Iain Gardner and Yoram Knoop opening the new ForFarmers UK HQ, June 2017

Iain Gardner and Yoram Knoop opening the new ForFarmers UK HQ, June 2017

“'Iain Gardner has been instrumental in leading the organisation to become the leading feed company in the United Kingdom,” notes Mr Knoop. “In the past four years, he has implemented the Horizon 2020 strategy, integrated several acquisitions and laid the foundations of many transformational projects to prepare the organisation for future challenges. We thank him for his commitment and contribution.”

Posted on December 5, 2017 .

Core Phillips McDougall team moves to Agbioinvestor

Much of the analyst team behind the respected Phillips McDougall (PMD) crop protection and seeds market analysis service has transferred to a new business, Agbioinvestor.

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Dr John McDougall and Matthew Phillips co-founded PMD in 1999 and it rapidly established itself as the premier source of information on the global crop protection and seeds sectors. The business was acquired by Informa plc in 2013, the company behind the Agra Europe and Agrow brands among other agri-food titles. Both Dr McDougall and Mr Phillips subsequently retired from the business.

Earlier this year, Dr McDougall created Agbioinvestor, an online platform initially providing news and analysis relevant to the global investment community exploring opportunities in the agri-food chain.

This month sees four analysts with more than forty years of collective experience gained in senior analytical and managerial roles at PMD join Agbioinvestor - Fraser McDougall, Allister Phillips, Derek Oliphant and Garry Mabon.  As a result, the platform is expanding its services into the agrochemical and biologicals; seeds & traits; digital agriculture; commodities and related industry sectors, in addition to undertaking bespoke consultancy projects. 

“I am delighted to announce these additions to the Agbioinvestor team,” says Dr McDougall. “This expansion of the team at Agbioinvestor will provide us with the opportunity to deliver industry-leading analytical reports to our valued clients.” These include the Crop Protection Industry Report and The Seed Industry Report, providing qualitative and quantitative analysis of their respective global sectors with key data, market insights and company financials.

Posted on December 5, 2017 .

Comment: Hands free harvest points to agri AI revolution

Last week’s remote controlled harvest of the ‘Hands Free Hectare’ of spring barley at Harper Adams University College was the culmination of an impressive experiment to grow a crop using robotic machines. No human had entered the plot from establishment to harvest - even the collection of grain samples to see if the crop was fit to combine was performed by drone.

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While small scale and relatively ‘Heath Robinson”, the Harper trial shows the way the industry is moving. Both John Deere and AGCO completed deals to acquire precision and robotics technologies this month - these traditional engineering businesses see the need to invest to keep up in this field. At the same time, major crop protection businesses are increasing their “big data” capability through collaborations with data providers and platforms.

We are still at an early stage in the marriage of data and field machinery, linked to satellite observation of weather, water and crop progress. But it is clear we are on the brink of agricultural artificial intelligence (AI) that uses sensors to measure weather, soil and crop conditions, using data to decide when to authorise robotic systems to implement field operations.

In time, this automation must include the delivery of essential inputs to the point of use and post harvest collection, grading and transport of the resulting produce into the food chain. It will be socially disruptive, in terms of jobs, but also require capital investment.

Meanwhile, back in 2017, traders continue to grapple with the fallout of the long, drawn out combinable crops harvest, which is by no means complete in some areas. It is taking time and money to identify where the quality is, and which crops have been downgraded by exposure to wet weather after ripening.

Will the brave new world of artificial intelligence be able to replace this too?

Posted on September 12, 2017 .

EU OKs Red Tractor biofuel grain

The European Commission has granted a temporary approval for Red Tractor assured crops to be use in biofuel manufacture, with the new approval backdated to the former expiry date.

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The move follows the expiry of the previous five-year approval which had been reported as causing grain movement problems, although the extent of this is hard to gauge.

The Commission has informed all EU-approved biofuel assurance schemes that the Red Tractor scheme should continue to be considered as compliant with EU Renewable Energy Directive (RED) sustainability criteria until November 5th 2017, pending its full five-year re-approval. The previous five year approval had expired in early August, meaning   Red Tractor-approved crops could theoretically no longer enter the European biofuels market.

The NFU says the extension will end “the severe disruption experienced by farmers recently in ex-farm grain movements”. While the issue attracted plenty of comment on farmer forums, grain supplies to the two major wheat bioethanol plants were not disrupted, with no reported incidences of contract defaults. However, there could have been a problem had the Commission not reacted so quickly with a temporary approval. Even so, some merchants had to invest in contingency arrangements, and there is criticism that the approval was allowed to expire in the first place, with little communication of the problem and its potential impact before the busy harvest period.   

A Red Tractor spokesman stated that the body had applied for renewal in February this year. However, the process was complicated by the need to incorporate those growers who had converted land to arable production after January 1st 2008.

“Although all the required data was supplied, delays processing the information within the European Commission led to a lapse in recognition. This has now been resolved with the granting of a three-month extension. While the delay was frustrating, the good news is that the changes to the scheme have been fully accepted, so every grower in the scheme will benefit,” he said.

“The extension is also backdated to August 6th 2017, which means that any Red Tractor crops destined for the biofuels market will be recognised as approved by the RED. So, if any growers had issues with outgoing crops or grain, these should now be resolved. Furthermore, the Commission has confirmed that there is nothing outstanding or further required from Red Tractor, to achieve a full five-year renewal of the scheme, which should be granted in the next few weeks. 

NFU combinable crops board chairman Mike Hambly observes: “An expedited temporary solution was needed and this is what we have received. We are pleased the EU Commission has been able to respond to the need for market certainty and to avoid further disruption. The Commission confirmed that the Red Tractor standards, as expected, would qualify for approval. We look forward to full five-year re-approval early this autumn.”


Posted on September 12, 2017 .

UK lags EU within ForFarmers H1 results

Interim results from European feed manufacturer ForFarmers show a 34% fall in profitability and 7% in revenues at the UK operation, which the company attributes to Brexit uncertainty delaying herd size recovery. But Group results are up as EU farmers benefit from rising dairy and meat prices.

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ForFarmers’ UK arm made an operating profit of €5.50 million on revenues of €315.65m in the six months to June 30th 2017, compared to €8.38m and €339.1m in H1 2016. Domestic volumes manufactured at 1.48m tonnes, were also down on the prior period’s 1.54m tonnes.

The company says UK profitability was affected by currency, with a negative exchange rate of 9.1%, in addition to competition for sales in the pig sector as ongoing consolidation leads to fewer but larger accounts buying bigger volumes on longer contracts. But a new dairy product range, based on the Dutch Feed2Milk concept, was positively received by customers and helped lift margins.

Lower ruminant and pig numbers contributed to the 3.9% fall in feed volumes, as did the divestment of the Leafield former feedstuffs operation to SugaRich at the end of the prior first half. But poultry volumes were up.

“There is great uncertainty about the consequences of Brexit for the agricultural sector in the UK,” notes the company. “This is why ruminant and swine farmers are reticent, among others, to recover their herd sizes, which were reduced last year. Despite this, the market appears to be recovering slowly.” It adds that UK farmers also tended to opt for cheaper, lower margin feed products.

UK operating expenses were 15.4% lower in the period. First half 2016 included a €1.6m restructuring charge, while a lower headcount, reduced vehicle leasing costs and the lower manufactured volume all helped savings in the latest period.  The half saw the business centralise its UK administration at a new HQ building in Bury St Edmunds.

In May, ForFarmers UK acquired Wilde Agriculture, the Wigton, Cumbria-based livestock consultancy business that includes the John Peel feed buying group. It paid €2m including a €0.5m contingent consideration. The business is also on track to bring its new £10m feed mill near Exeter on-stream by the end of the year.

The ForFarmers Group, which covers Holland, Belgium and parts of Germany as well as the UK, has posted an 18% rise in profitability on 3.7% higher revenues. It made an operating profit of €38.7m on sales of €1.11 billion in H1 2017, up from the €32.8m and €1.17bn from the previous first half. The business says the devaluation of sterling since the end of June 2016 cost it €6.0m or 3.4% in the latest six months.

Total feed volumes were up 3.6% to 4.73m tonnes, with compound sales growing by 6.2% to 3.3m tonnes, largely through last year’s purchase of the Dutch Vleuten-Steijn pig feed operation.

“Volume growth in the Netherlands and Germany/Belgium was higher than the volume decrease in the UK,” notes the company. “As of mid-2016 the financial situation for farmers in Europe has significantly improved due to enhanced milk and swine prices, which partly explains the volume growth in compound feed within total feed.”

“The first half-year results show that our Total Feed approach is gaining more and more momentum,” notes ForFarmers Group chief executive Yoram Knoop. “In our innovative Total Feed solutions we are combining feed products, advice and tools. Products and advice are aligned with one another to lead to a better return on the farm.

But Mr Knoop warns that the rate of growth is unlikely to persist into the second half, due to factors including the slow UK recovery; the impact on phosphate limiting regulations on dairy farmers in Holland and the as yet unknown effects of the fipronil-contaminated eggs issue in Holland and Belgium.

“Our customers are currently in better financial shape than a year ago, when milk and pig prices were under pressure. Farmers, especially in the Netherlands and Germany/Belgium, are buying more high quality feeds again to increase their production. There is large uncertainty in the UK about the consequences of Brexit, but in spite of this, the market there appears to be recovering slowly,” Mr Knoop concludes.

Posted on September 12, 2017 .

Kent Wool Growers goes under

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Kent Wool Growers (KWG), the long established farmer-owned business based in Ashford, has called in the receiver. A British Wool spokeswoman confirmed that the KWG situation would not affect its registered producers, and the collection and grading of the 2017 wool clip will go ahead as normal.

Steve Absolom and Will Wright from KPMG have been appointed joint administrators for the KWG business, which blames a downturn in both retail and account sales for its demise.

The business distributes feed made at Duffield’s’ Wingham mill, and a range of horse feeds under the Baileys, Dengie and Dodson & Horrell brands. It has three rural retail outlets at Ashford and Eastry in Kent and at Handcross West Sussex; a fuel brokerage service; and acts as an ‘A’ merchant for the British Wool Marketing Board, collecting and grading wool from across Kent and East and West Sussex.

KPMG says the business is continuing to trade while they seek a purchaser for all or parts of the business as a going concern.

 “We have received a number of expressions of interest in the business and assets, and so our efforts are focussed on achieving a going concern sale which will secure as many jobs as possible,” states Mr Absolom. “The stores remain open and KWG continues to support the farming community as best it can in these circumstances.”

Kent Wool Growers was founded in 1920 and currently employs 48 staff.

Posted on September 12, 2017 .

NWF recovers from H1 loss to full year profit

Feed manufacturer NWF Agriculture has bounced back from a first half loss to report better than expected full year figures. With its delayed feed capacity restructuring project now complete, it is confident of future growth.

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The company, one of three divisions of the NWF Group, has reported a headline operating profit of £1.5 million on revenues of £158.2m in the year ended May 31st 2017, compared to £2.1m and £135.8m from the previous year. However, after exceptional costs of £1.2m, operating profit is £300,000. Delays in commissioning the additional capacity in Cumbria, plus redundancy and relocation costs, resulted in the exceptional charge of £1.2m.

In June, the Group had warned of a reduction in full year volumes and revenues, following NWF Agriculture’s earlier first half loss of £300,000 on revenues of £65.1m.  

NWF says low milk prices, averaging 20.5ppl at the start of the year in May 2016, depressed the feed market over the summer, but an increase in milk prices from the autumn to 26.9ppl by the year end, saw a rise in feed demand. While the company’s full year ruminant volumes were up by 1.5%, the growth came from sheep feed products. NWF’s total feed volume for the year was 589,000 tonnes, up from 2016’s 580,000 tonnes.

But production costs were higher too, due to volatility in the commodity and foreign exchange markets. NWF’s feed materials cost increased by 17% from the start of the financial year until March 2017, since when they have eased. But the market couldn’t absorb these extra costs, leading to tighter margins.

The year saw a £5.2 million investment programme to match production capacity to the company’s trading area. The former SC Feeds mill in Staffordshire was closed and the Jim Peet mill at Longtown, acquired in 2015, expanded significantly. The business also invested in automating the blend plant at its Wardle headquarters in Cheshire to meet growing demand and secure efficiencies. The additional capacity is now fully operational - it “provides world class operating units close to our key farming customers from the South West of England to Scotland and gives an effective platform for further development.”

NWF says increasing its focus on animal nutrition through providing high quality feed advice and value added products for its 4,750 farmer customers across the country remains a key priority. This strategy has been particularly important in recent months as milk producers seek to increase output in the light of better prices.

With an operational platform comprising three equally spaced feed mills along the western side of England, and improved milk prices, NWF Agriculture says it is well placed to grow organically and to seek further market consolidation opportunities through purchasing volume. But any acquisitions will need to be synergistic with the existing business, capable of development and have a proven management team.

The NWF Group posted full year operating profit of £9m on revenues of £555.5m, up from £8.7m and £465.9m in the previous year. It says strong performances at its Fuel and Food divisions helped offset the difficult year for Feeds.

“NWF delivered a solid performance last year with increased activity in all three divisions and the benefits of the diversified business model resulted in record earnings per share,” notes Group chief executive Richard Whiting. “The increase in profitability and strong cash generation also enabled the Group to continue its investment strategy, with major feed mill expansions completed in the year.

“We continue to see opportunity for further strategic and operational progress and our performance in the current financial year to date has been in line with our expectations.”

Posted on September 12, 2017 .

Gafta to end its UK store and transport assurance

The Grain & Feed Trade Association (Gafta), the London-based body representing international grain and feed material traders, is to withdraw from the storage and haulage elements of its Gafta Trade Assurance Scheme (GTAS).


The decision will affect 92 storekeepers in the UK and the Ukraine and some 400 UK haulage businesses. GTAS is   independently audited by NSF Certification UK.

Gafta says the move follows a review of its trade assurance service provision, including GTAS and the Approved Registers, to ensure it is meeting the needs of its members as the industry continues to change. This concluded that Gafta’s core purpose is supporting and developing the ancillary support services used by its international trading members, such as supervision, arbitration, fumigation and analysis, rather than the storage and transport functions which are duplicated by a “plethora of schemes across Europe”.

This process led to last month’s Gafta Council approving plans to develop and rebrand the trade assurance offering, aligning it more closely with Gafta contract terms.

As a result, Gafta will create a new Approved Register of Fumigators alongside its existing Approved Registers of Superintendents and Analysts, which themselves will be enhanced.

The GTAS changes include the phasing out of the codes of practice for Road Transport (hauliers) and Bulk Storage. The Analysts and Supervision codes of practice will be revised to support the requirements of the existing Gafta Approved Registers, while the Fumigation code of practice will be updated and become a requirement of a new Gafta Approved Register.

The association says members affected by the changes – particularly those using the haulage and storage codes - will be contacted individually. It plans to phase out the two codes over an 18 month period to the end of 2018.

“There are a number of alternative food and feed safety schemes in the marketplace and Gafta will continue to support members of these codes throughout the transition period,” it states. “The GTAS scheme is audited by NSF Certification with whom Gafta has worked since the launch of GTAS in 2005. It is hoped this relationship will continue as the scheme develops its codes of practice for analysts, fumigators, supervision and trading.

“Training courses will be developed to help members meet the requirements of the new codes of practice and to improve standards across the industry. Gafta remains committed to providing first class services to its members and is in a unique position to raise the standards of the ancillary support services in international agricultural commodity trading.”

The AIC, aware that Gafta has announced its withdrawal of transport and storage assurance in the UK, says it has written to all GTAS participants to update them on its Trade Assurance Scheme for Combinable Crops (TASCC).

“Assurance is a vital part of the supply chain that delivers feed and food safety,” notes John Kelley, managing director of AIC Services. “TASCC is an up-to-date scheme with many benefits that delivers this assurance. We look forward to helping former GTAS participants meet their new assurance needs.”

Posted on September 12, 2017 .

Comment: Brexit divisions unhelpful for UK agrifood sector

One year on from the EU referendum, with Article 50 triggered in March, the uncertainty over the UK’s approach to Brexit remains. Cabinet infighting only adds to the impression of disarray.

The prime minister’s failure to secure a mandate for her Lancaster House Brexit vision in last June’s election has lead to an apparent consensus building under Philip Hammond for a more economically sensible transition period out of the EU. But this has yet to be agreed at cabinet.

New Defra Secretary Michael Gove has spent his first few weeks telling his audience what they want to hear – he told the NFU in June that he backed high quality food production, while in July he unveiled his Green Brexit vision to an audience of environmentalists. But there was a clear signal that public support will move from production to public goods, and away from larger businesses.

That was the easy bit – Mr Gove now has to distil these views into a workable agricultural policy, and enshrine this in law through an Agriculture Bill. Assuming the present administration lasts, this can only pass through the Parliamentary process with the support of Scottish Conservatives and the DUP in Northern Ireland – both areas where agriculture forms a greater part of the regional economy than in England.

Of course there are opportunities for a post-Brexit UK agriculture to benefit from technology and innovation, and to be less constrained by a common European policy. But divisions this early over trading standards in food products between Defra and the international trade secretary don’t bode well for the UK competing in global food markets.

Posted on August 3, 2017 .