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<p>Defra is working very closely with the dairy and other agricultural sectors through
this period of disruption to manage the impact of Covid-9 on the dairy supply chain.</p><p>The
Government encourages environmentally-friendly farming. Each farming method has its
own benefits and it is a farmer’s commercial decision to choose the system that best
suits their farm. Environmentally-friendly farming and food production can go hand
in hand.</p><p>To support the dairy industry through impacts of Covid-19, we have
introduced a wide range of measures, which will also benefit dairy farmers employing
agro-ecological practices.</p><p>We have eased some elements of competition law to
make it easier for dairy processors to come together to maximise production, processing
and storage efficiency and ensure as much product as possible can be processed into
high quality dairy products.</p><p>Moreover, in recognition of the unprecedented challenges
facing this sector we announced on 7 May a new fund to support those dairy farmers
who have seen decreased demand due to the loss of the food service sector. Eligible
dairy farmers in England who have lost more than 25% of their income over April and
May due to coronavirus disruptions will be eligible for funding of up to £10,000 each,
to cover 70% of their lost income during this qualifying period. This will enable
these producers to continue to operate and sustain production capacity without impacts
on animal welfare.</p><p> </p><p>AHDB together with Dairy UK have also launched a
new £1m campaign to drive consumption of milk. Running over 12 weeks, the campaign
will highlight the role that milk plays in supporting moments of personal connection
during times of crisis. Defra and the devolved administrations are jointly contributing
towards the financing of this campaign.</p><p>Alongside the Covid-19 Business Interruption
Loans Scheme, HMT has announced the new Bounce Back Loan scheme which will also apply
to businesses operating in agriculture. This will ensure that the smallest businesses
can access up to £50,000 loans. The Government will provide lenders with a 100% guarantee
on each loan, to give lenders the confidence they need to support the smallest businesses
in the country. We will also cover the first 12 months of interest payments and fees
charged to the business by the lender.</p><p>The existing public intervention scheme
for skimmed milk powder and butter continues to be available. This provides a floor
price for dairy products, supporting the dairy industry to sell skimmed milk powder
and butter into public intervention when the price they would receive on the open
market falls below the intervention price. In addition from 7 May, UK dairy processors
are also eligible to apply for EU funded private storage aid in respect of skimmed
milk powder, butter and cheese.</p><p>For organic dairy farmers whose milk is being
sold as conventional milk, we offered a derogation to allow these farmers to provide
their cows with conventional feed in order to reduce costs.</p><p>The new Environmental
Land Management scheme will be the cornerstone of our future agricultural policy.
It will reward farmers and land managers for the delivery of public goods with public
money. The ELM scheme is being designed collaboratively with stakeholders. We are
considering how more environmentally-sustainable farming approaches, including organic
farming and agro-ecological approaches, may fit within ELM where these contribute
towards the delivery of environmental public goods. Land managers will be paid for
delivering the following public goods set out in the 25 Year Environment Plan: clean
air; clean and plentiful water; thriving plants and wildlife; protection from and
mitigation of environmental hazards; beauty, heritage and engagement with the environment;
mitigation of and adaptation to climate change</p><p>Meanwhile, Countryside Stewardship
(CS) provides a stepping stone to the future scheme, paying for environmental enhancements
now as area-based payments are phased out. CS supports Defra’s Strategic Objective
of ‘a cleaner, healthier environment, benefitting people and the economy’. Through
the scheme, farmers can apply for funding to improve their local environment – from
restoring wildlife habitats and creating woodlands to managing flood risk.</p><p>
</p><p>We will continue to offer Countryside Stewardship agreements in 2021, 2022
and 2023.</p>
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