Sheep producers who dispose of dip chemical without Environment Agency authorisation and pollute waterways are putting their single farm payment entitlements in jeopardy.

According to Bob Merriman, the Haverfordwest-based Environment Agency Wales Agriculture policy advisor, farmers risked falling foul of the CAP cross-compliance requirements.

"Sheep dip is very polluting but, with proper authorisation and good practice, farmers and contractors can avoid risks to the environment," he said. Farmers and contractors must have a valid authorisation from the Environment Agency to dispose of used dip chemical.

A code of practice was published by DEFRA in 2001 and sets out advice for protecting the environment when dipping, jetting or showering sheep, including the use of mobile units.

According to the Environment Agency, farmers have responded positively in recent years to reduce serious water pollution incidents from farms. But in recent months there had been very serious cases of pollution involving synthetic pyrethroid sheep dip chemicals in north-west England and Herefordshire.

"These incidents highlight how devastating these chemicals are to river life,'' said Bob Merriman.

"The incident in Herefordshire killed a very important population of native crayfish, a protected species.''

Environment Agency investigations in mid-Wales, he added, had highlighted the damage caused by sheep accessing streams immediately after dipping.

"It is very important that farmers follow this advice to keep sheep out of streams, using drinking water troughs so they don't rush to streams to drink. After all, if the dip chemical washes off the sheep, they may be left unprotected," said Mr Merriman.