Written question asked by Owen Paterson (Conservative) on Monday, 8 December 2003, in the House of Commons. It was due for an answer on Thursday, 18 December 2003. It was answered by Ben Bradshaw (Labour) on Thursday, 18 December 2003 on behalf of the Department for Environment, Food and Rural Affairs.

Dept for Environment Food and Rural Affairs

Question: To ask the Secretary of State for Environment, Food and Rural Affairs, whether compensation will be paid by her Department to farmers affected by the over-estimation of the wheat area for this year's harvest; and if she will issue a formal apology to farmers. - Including figures.

Answer: Mr. Paterson: To ask the Secretary of State for Environment, Food and Rural Affairs whether compensation will be paid by her Department to farmers affected by the over-estimation of the wheat area for this year's harvest; and if she will issue a formal apology to farmers. [143587] Mr. Bradshaw: I regret that the error was made. Defra figures are only one of a number of sources of information available to the market and individual buyers and sellers have to use their own commercial judgment. Although there was an initial increase of approximately £5 per tonne immediately following publication of corrected figures, this had reduced by about half within a few days with the price back on trend. This reflects the UK's position as a price taker rather than a price maker in an international commodity market. UK production is only about 13 per cent. of EU production, and EU production is just over 20 per cent. of world production. On average, however, wheat prices this year are now some £50 per tonne higher than at the same period last year. They have risen steadily throughout the marketing season in response to serious reductions in supply elsewhere in Europe as a result of heat and drought in the summer. This has also coincided with a tighter global market which has seen world wheat prices at their highest levels in recent years. There was no discernable effect on prices when the provisional agricultural census results were published in the middle of September.

Secondary information