INTRODUCTION
•
•
•
•
•
•
•
WAOS founded in 1922 as the central body for
Agricultural Cooperation in Wales
Secured Government assistance in 1931
Cooperation boosted by Agriculture Act 1967 (CCAHC
created)
Agriculture Marketing Act 1983 (FFB created to subsume
CCAHC)
FFB withdraws from Agricultural Cooperation in Mid
1980’s
WAOS not supported financially since
WAOS operates as an Agri-food consultancy and is
financed exclusively from fees earned_
THE WAOS VISION
• Farmers have profitable and sustainable futures as
mainstream suppliers of agri-food products.
• By cooperating farmers will be able to capitalise on
opportunities from the increased flexibility under the
decoupled support system
• Opportunities from growth in vertical collaboration in
food chain as a response to greater demand for
efficiencies
WHY COOPERATE
• Food security and food inflation should give the
primary producer an advantage
• Value growth benefits retailers and processors
more than producer
• Rationalisation in food chain weakens the farmers
strategic position
WHY COOPERATE
•
•
•
•
•
•
SFP leaves market forces determine farm gate prices
Without initiatives by farmers their market returns will be
dictated by world agricultural commodity prices
Future characterised by new opportunities as Food
security becomes more relevant
Relationships have been established in the supply chain
for the benefit of processors and retailers
Food supply chain concentrated whilst farming remains
fragmented
Cooperation best solution but lags behind rest of world
OPPORTUNITIES FOR
COOPERATION
•
Food safety a major issue
•
Changing consumer lifestyles and demographics
•
Increasing demand for convenience, healthier, and
environmentally friendly foods at a price
•
Food provenance, assurance, traceability, fair trade,
organic supply and carbon footprint are issues that will
come to the fore
WAOS DEVELOPMENTS
• Welsh Lamb and Beef Producers
Ltd
• I and P Cooperative of 7500
livestock farmers producing 75% of
the lamb and beef in Wales
• Farm assurance
• Organic Certification
WLBP Ltd
•
Farmers route to market. Farm assurance a minimum
requirement for entry to UK multiple retailers
•
Earned recognition under cost and responsibility sharing
initiatives
•
Lower Risk Profile for Statutory compliance audits (FSA,
Animal Health, Environment Agency, Cross compliance
…..)
•
Owned by farmers under Subscription model of
constitution
•
Data management and information resource
WAOS SERVICES
•
Agri-food consultancy
•
Financial Services Authority “Sponsoring Body” for Model
Rules
•
Management Services and resources
•
Corporate Governance
•
Board and company secretarial services
•
Non Executive Directors
WAOS SKILLS
•
•
•
•
•
•
•
•
FINANCIAL AND ACCOUNTING
CORPORATE PLANNING
MARKETING
LEGAL AND CONSTITUTIONAL
ORGANIC CERTIFICATION
PRODUCER CERTIFICATION
CORPORATE STRUCTURES
CHANGE MANAGEMENT
•
Staff Qualifications: MBA’S, Qualified Accountant,
Certification Auditors, Organic Certification Officers,
Agricultural Scientists, Agriculture Graduates.
•
THE PRODUCER
•
Retailers and Producers see collaborative opportunities
within current structures rather than producers moving up
the food chain
•
This will not result in investment beyond farm gate and
farmers taking a more proactive role in engaging with
consumers
•
The belief that farmers are incapable of playing a larger
role in the food chain must be challenged
•
Niche market opportunities strong for Welsh Produce
e.g. Welsh Mountain lamb
SERVICED FOOD SECTOR
•
Has been the UK’s fastest sector worth £50 Billion
accounting for 35% of total food expenditure
•
Consumers demand more information about the food
they consume
•
Food service need to source from recognised accredited
sources
•
Cooperation’s ability to bring critical mass and
traceability represents a real opportunity
COOPERATION IN WALES
•
Farmers are entrepreneurs and want a capitalistic
approach to cooperation with return or at least
preservation of investment
•
Farmers will need PROFIT as one of the drivers for
cooperation
•
Recent trends in Wales have been for the development
of “quasi” cooperatives operating in the name of
cooperation and not by structure
DEVELOPMENTS IN UK
•
SAOS-Scotland-substantial funding from Public Sector
equivalent to £382,000 p.a in 2009
•
EFFP-England-awarded £2.5million by DEFRA in 2004
to “Help farmers in England work together and become
more competitive and profitable” EFFP restructured in
2009 as an Agri-food consultancy
COOPERATION DELIVERS
•
Purchasing Cooperation (Buy Inputs at lower prices)
•
Marketing Cooperation (Joint Activities for outputs)
•
Processing Cooperation ( benefits from added value )
KEY FACTORS TO DEVELOP
SUCCESSFUL AGRICULTURAL
COOPERATION
•
Driving motivation must be profit not cooperation for its
own sake. Structures must be well capitalised
•
Planning must be strategic and long term
•
Farmers must participate financially and commit to
enterprise
•
Recruitment of top professionals paid accordingly and
given appropriate autonomy
•
Strict corporate governance to ensure integrity and
financial scrutiny and probity
DELIVERY MECHANISMS
•
Communication to farmers and the supply chain
•
Understand requirements of consumers, food retailers,
and food service companies
•
Good governance and monitored financial performance
to minimise risk of Business failure
•
Maintain Member Confidence and support
•
Data Capture and Management of Information
•
Develop a dynamic Strategy
•
Develop the appropriate constitutional structure for
growth that best fits the strategy (Structure follows
Strategy)
CONCLUSION
•
Welsh farming a lifestyle as well as a livelihood
•
Farming is long term business
•
Cooperation can be the salvation as Cost and
Responsibility sharing initiatives come on line
•
Farmers must invest in their own destiny
•
Catalytic funding from public sector would pay good
returns as the Industry takes more control
•
Wales cannot be left behind
PRESENTATION BY
•
DON THOMAS
•
Chief Executive WAOS LTD
•
GORSLAND, NORTH ROAD, ABERYSTWYTH
•
01970636688
•
dont@wfsagri.net
CO-OPERATIVE
SECTOR
TURNOVER
Corwen Farmers Ltd
Agricultural Supply
£5 million
Wynnstay Group plc
Agricultural Supply &
Other industry
Carmarthen & Pumsaint Farmers
ACTIVE
MEMBERS
TRADING
SHARE
HOLDER
REGISTER
850
1,200
£300 million
4,500
4,500
Agricultural Supply
£20 million
1,800
7,500
Clynderwen & Cardigan Farmers Ltd
Agricultural Supply
£34 million
2,250
6,200
Hay & Brecon Farmers Ltd
Agricultural Supply
£12 million
1,100
1,900
Welsh Farm Suppliers Ltd
Federal Supply Cooperative
£33 million
12
body corporate)
12
South Caernarfon Creameries Ltd
Milk Processing & Cheese
£28 million
250
250
Farmers Mart Ltd
Livestock Auctioneering
£8 million
628
950
Dyfed Seeds
Federal Grass Arable Seed
Processing & Agricultural
Chemicals
£4 million
18
(body corporate)
18
Welsh Lamb & Beef Promotions Ltd
Livestock
£1 million
7,300
Welsh Mule Sheep Breeders Assoc Ltd
Livestock Sales
£1.5 million
Welsh Mountain Sheep Breeders Assoc
Ltd
Livestock Sales
£1.0 million
Devils Bridge Auction Mart Ltd
Auctioneering
£0.4 million
95
95
Camda Cynwyd Ltd
Development
£2.0 million
9
9
Radnor Quality Livestock
Ltd
Livestock Procurement
£1.8 million
730
730
Primestock Producers Ltd
Procurement/Training
£<0.2 million
650
650
Welsh Livestock Ltd/ Welsh Meat Co
Ltd
Procurement & Marketing
£2.0 million
650
650
Welsh Half Bred Sheep Society
Livestock Sales
£1.8 million
850
850
Miscellaneous
Not Active
Miscellaneous
N/A
Livestock Marketing Ltd
Livestock Trading
£4.0 million
920
7,300
920
350
1000