The Farmers' Union of Wales today raised Welsh farming's concerns about the future of the Common Agricultural Policy (CAP) at a high level meeting with European Commissioner for Agriculture Dacian Ciolo? at the Royal Welsh Show.

During the meeting, also attended by numerous EU Commission officials and cabinet members and deputy agriculture minister Alun Davies, FUW president Emyr Jones made it clear that Wales needed to implement a payment system which did not undermine food production and that any changes should take place over an appropriate transition period.

"A host of other key concerns were discussed, including the adverse impact that 'greening' measures would have on both agriculture and the environment, and the need to allow farms to respond to market pressures, rather than limiting land use through restrictive greening measures."

Mr Jones said the meeting had been a very positive one at which the Commissioner acknowledged the need to look at a number of key issues of concern to Welsh farmers.

"We very much welcome the Commissioner's presence at the largest agricultural event of its kind in Europe.

"Mr Ciolo? has been left with a clear impression of the importance of agriculture and food production to Wales, and the key changes which need to be made to the CAP proposals in order to ensure Welsh agriculture is not undermined."

Mr Jones added that important amendments to the proposals had already been submitted to the EU Parliament by the FUW, following a report by EU Agriculture Committee Rapporteur Capoulas Santos, and that he hoped these would be accepted during the coming months.

Royal Welsh Show visitors will be encouraged to show their support for Welsh dairy farmers by signing an open letter to supermarkets and milk processors at the Farmers' Union of Wales pavilion alongside the main ring during this week's four-day event (July 23-26).

By signing the letter they will be expressing their dismay over the impact reductions in farmgate milk prices on farm businesses in Wales and calling for action to reverse the cuts.

The letter will also emphasise the need for all those involved in the dairy supply chain to work together to ensure an acceptable and sustainable price is received by all.

"The recent cuts come at a time when feed prices and wet weather have caused a major rise in milk production costs meaning that large numbers of farmers are receiving or anticipating below cost-of-production prices for their milk," the letter adds.

"Coupled with other financial pressures on producers, not least those caused by the ongoing bovine TB epidemic, the recent cuts represent a major threat to the industry as a whole, particularly the traditional family farms where consumers expect their milk to be produced.

"This is confirmed in a recent report by Kite Consulting which states that the exit rate for those producers subjected to the lowest price cuts and the best dairying conditions will be between 3% and 5% because of low confidence and cash-flow problems, while the exit rate as a whole could easily rise to levels of around 15% for the industry as a whole once a 1.5p/litre feed price increase takes effect.

"The report also states that the price cuts due on the 1st of August will result in a monthly deficit for the average farmer of £6,500, rising to £7,500 as anticipated production costs increases take effect.

"In the short term, and in order to avert a severe reaction by the industry and a major reduction in UK milk production, it is clearly in the interests of processors and supermarkets to undo the damage done over recent weeks by restoring prices.

"However, in the long term it is essential for all those involved in the supply chain to work together to ensure stability within the industry.

"The forming of Producer Organisations, adoption of a Code of Conduct and the development of acceptable contracts all have an important role to play in doing this.

"It is also essential that price mechanisms, which are transparent and ensure returns to producers which genuinely reflect production costs and market values, are introduced.

"I would therefore urge you to do all you can to ensure that the recent damage caused to the industry is undone, while seeking to secure the long term solutions referred to above well ahead of the abolition of milk quota in 2015."

A life-size model of a dairy cow Tegwen - Welsh for "fair" and "white" - painted in the colours of the Welsh flag will also highlight the FUW campaign to achieve a fair farmgate price for milk during the Royal Welsh Show.

A new black and white poster with a headline "Dairy Farmers Need a Fair Price" graphically depicting the plight of Welsh dairy farmers will hang from Tegwen's neck as she ruminates alongside the pavilion.

It will show the average retail price for milk is 30p per pint, production costs are 17p but the farmer receives just 14p per pint.

"The poster shows in simple terms just why the dairy industry is in crisis and why the number of traditional dairy farms continues to dwindle across Wales," said FUW milk and dairy produce committee chairman Dei (CORRECT SPELLING) Davies.

"Over 800 dairy farms in Wales have shut down between 2006 and last year. The figures reveal that in just five years they have dwindled from 2,727 to 1,908.

"It must not be overlooked that the loss of these farms has its own knock-on effect on community life in our rural villages and communities which thrived in past times due to a vibrant farming industry."

The Farmers' Union of Wales is backing a bid by farmers in Meirionnydd to run their own Internal Drainage Districts (IDDs) following reports that Environment Agency Wales (EAW) is considering disbanding several IDDs under Welsh Government Single Body consultations.

This was greeted with alarm by farmers at an FUW Meirionnydd county meeting in Dolgellau attended by local AM Dafydd Elis Thomas.

Seven of the 11 IDDs currently run by EAW are in Meirionnydd and one option is for groups to establish Internal Drainage Boards (IDBs) independent of EAW.

During a well-attended meeting in Dolgellau - organised by the FUW's Meirionnydd branch - farmers gave unanimous support to the idea of setting up their own IDB for the county and for other IDDs in North Wales.

Detailed consideration was given to the current Welsh Government consultation on the future delivery of the functions of IDBs and IDDs.

"There were representatives present from the majority of the IDDs in Meirionnydd and the good attendance was a reflection of the importance of continuing the work within the IDDs, mainly the maintenance and improvements of the drainage system, works to alleviate flooding and some capital works," said FUW county executive officer Huw Jones.

"Reference was also made to controlling activities in and alongside the drainage system to ensure that flood risk management and land drainage standards are not impaired."

Seven of the 11 EAW-administered IDDs are in Meirionnydd and include Ardudwy marsh, Dysynni Valley, Glaslyn and Pensyflog, Harlech and Maentwrog, Llanfrothen, Mawddach and Wnion and Tywyn.

"Farmers were alarmed to read that EAW are considering the viability of a number of IDDs under their administration with a view to removing the designation from some areas.

"One of the options in the paper is the possibility that individuals may come forward with a view to establishing dedicated IDBs and taking the role on in place of the agency.

"Members discussed the benefits of the governance of IDBs, namely that land owners/occupiers (the ratepayers) are elected on to the board and local authorities appoint members to the board as representatives of the wider community.

"This ensures that the local community can govern the management of their own water landscape in these specially designated areas."

Mr Thomas reported on the current position on the setting up of the Single Environment (Natural Resources Body) and supported those farmers who wished to set up an IDB.

FUW county chairman Olwen Ford said there was unanimous support to look further into the option of establishing an IDB in Meirionnydd and for other IDDs in North Wales.

She would be pleased if the FUW could assist in facilitating or being a catalyst for change.

Glyn Griffiths, of Bodlondeb, Rhyd, near Penrhyndeudraeth, who has already chaired a meeting of farmers in the Llanfrothen and Glaslyn Pensyflog areas, reported that a decision had been made to move ahead to establish an IDB, although he accepted it had to be with the co-operation of farmers in other IDDs.

It was finally decided that arrangements should be made in September to contact farmers by letter to consider this issue further and Mr Jones was asked to liaise with EAW.

With energy bills proving to be a major cost for farming enterprises the Farmers' Union of Wales has teamed up with a leading UK electricity and gas company to offer its members a dedicated account management service to give them best value prices.

The new service, provided by E.ON in partnership with the union's energy consultants Adamian Davis Meade, will be unveiled at the FUW's revamped pavilion alongside the main ring during next week's Royal Welsh Show.

The one-to-one account management service is intended to develop a close working relationship with members through farm visits timed to suit customers' needs and not confined to normal office or call centre hours.

"These fact-finding visits will be based on members' businesses, understanding their needs and delivering specific solutions," said FUW business development director Emyr James.

During discussions with the FUW, E.ON referred to one example of how the scheme had saved a farmer with two farms and a farmhouse hundreds of pounds.

"The company looked at the customer's bills, discussed how energy was being used and offered a fixed term contract to ensure pricing stability on the bills," said Mr James.

"An estimated annual saving of £1,400 (37%) was achieved based on the previous year's consumption. Energy consumption will be monitored over the coming months and if it's found the customer would benefit from a different tariff then they will replace the meters free of charge, resulting in further savings."

E.ON's head of SME direct sales Scott Dale said they will adopt a consultative approach with FUW members, providing honest and straightforward advice at all times and offer the customer a service based on their needs.

Details of the service will also be available from E.ON and Adamian Davis Meade representatives on the FUW stands at various county shows this summer.

Welsh-speaking assistance will be available during farm visits if the customer requests the meeting is conducted in Welsh.