Memorandum submitted by Crowe Livestock
& Co (X06)
STUDY ON
STATE OF
POULTRY INDUSTRY
In response to the article in Poultry World
April 2003 please note out thoughts. In summary our view point
is from an insurance perspective, we underwrite poultry risks
throughout the world and have a particular unique programme for
the UK.
State of Poultry farming in particular the impact
of new regulations on the industry and its competitiveness and
on animal welfare standards
1. We tend to find that generally poultry
units abroad are much more commercialised than in the UK. Being
much larger and also more technical than a number of the UK units.
We presume the reason for this is that other countries enjoy lower
costs of construction, labour, materials and energy. There is
generally more space in other countries so they are less constrained
when building larger, more high tech facilities. Access to water
is generally easier with less constraints regarding pollution
and complaints to new build. There does appear to be a general
movement from the UK to other countries particularly for the breeding
stocks. It is likely that new regulations will see a greater movement
from the UK to abroad which tends to back up our thoughts.
2. Welfare Standards: Crowe Livestock have
developed their own minimum standards which are higher than the
current animal welfare standards, as we believe this will be introduced
in the future/ or to new houses which are built. When assessing
farms for insurance we have an intensive proposal completed and
then perform either a phone survey or have a site visit carried
out by our risk manager. It is surprising the number of farms
which state they are red tractor/freedom foods approved or other
certifying bodies stating that production method and farms meet
a certain level when in actual fact our survey highlights areas
where a significant number of farms do not actually comply with
the certification standards. Is this due to the time allocated
for site visits or is it linked to self certification? Another
area highlighted is that many farmers are unaware of what is required
to achieve modernisation or higher production, at high levels
of welfare. A number of farms are just not of the size to be in
a financial position to consider improvement. This idea of development
and change within the industry leads on to Organic birds, although
there are guidelines standards are required. To help the organic
farms we insure this is a project we are currently working on
with our risk manager.
It is all very well there being these standards,
but why can't the poultry industry as a whole work towards one
national standard, with supermarkets, the food standard agency
rather than everybody working against each other. This will not
only help the industry but also consumers.
3. Which leads on to Biosecurity, although
the poultry (and pig industry) is more aware of the need for Biosecurity
in this country, recent disease outbreaks have just highlighted
the importance of this issue. We do come across a number of farms
that do not understand or appreciate its importance. The recent
outbreak of Newcastle's disease in the states and subsequent Avian
Influenza in Europe has had an influence on the UK industry not
only as a result of the prohibition of export of day old chicks
from the USA, the prohibition of any plane carrying birds stopping
and refuelling and the result of borders being closed so slaughter
houses can not source birds. This ultimately leads to a down turn
in the market which then allows countries such as Brazil, Thailand
to take advantage of the situation, often initiated by the more
successful farmers from the UK and Europe. In our experience,
even just maintaining a simple visitors book and providing equipment
to wash in and out seems to be beyond some farms, others do not
consider recording visitors if they do not enter the houses, which
is a risk in itself. Greater consideration is required for biosecurity,
as this not only provides a competitive advantage, but it also
reduces the risk of production being interrupted by disease outbreak
and the like.
4. We offer a risk transfer mechanism, for
mortality of birds. It is surprising the number of producing companies
that do not consider this as a risk, perhaps it is because they
do not know the insurance cover is available? Statistically the
risk of a loss following disease is much greater than a loss caused
by fire or standard perils, but so few poultry producers insure
for this eventuality. As far as we are aware, we at Crowe Livestock
Underwriting Limited are the only such company to offer death
of insured poultry as a result of mortality and disease and can
extend this further to economic slaughter and or government slaughter.
It is interesting to look at the different coverage's we provide
throughout the world, in the UK it tends to be straight mortality
and mechanical breakdown. Whereas in Europe particularly Belgium
and Holland disease cover for MG and Salmonella is required as
these diseases would result in whole flock slaughter and there
is not currently government compensation for this, Holland has
attempted to put a program together, but although there is support
for it, the fund would be limited to a first come first served
compensation program whereas Crowe Livestock provides insurance
for a large majority of these farms which is only limited to the
security we can source. The compensation scheme would be on a
subscription basis and hence act as a risk transfer mechanism
for the farmers as well. On preparing the insurance program it
is shocking to see the number of farms and large production companies
who are unaware of the number and value of the birds on the ground
at any one point, and on calculation the value of the stock at
any one point is a significant risk that many do not realise.
Overall, are new regulations required, or does
the industry just need the governing body to consolidate requirements
into one national standard of all production methods, be it broilers
layer, indoor, outdoor, free range, organic? This way it would
be so much easier and simpler to market pure British goods and
not allowing the packaging of foreign goods in the UK to be passed
of British goods. Promote the importance of welfare, biosecurity
and encourage upgrading of facilities to improve the overall standard
of the UK poultry industry without pushing production to other
countries. If our current government is serious about producing
poultry in this country a support package should be provided to
such farmers to help them overcome the obvious disadvantages they
have of farming in this country.
It is not good enough for us all to export our
consciences when it comes to animal production. We are proud to
be British and proud to buy British, we know that our farmers
in all sectors do their utmost to produce animals in the most
humane and cost effective way, despite the never ending constraints
piled onto us from Brussels, most of which have been implemented
without adequate research and understanding that few countries
actually abide by them.
Crowe Livestock & Co
14 April 2003
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