As the UK government looks to secure new global trade deals, the farming industry must be under no illusions about the challenges that lie ahead, UK farm leaders have warned.
Taking part in a debate involving the presidents of the four UK farm unions last Thursday, the president of the National Farmers Union (NFU) Minette Batters pointed out that the UK is principally a service-based economy.
As a result, the big opportunities for the UK are in offering the likes of banking services, not manufactured goods, to other countries in trade deals.
Last month, the UK government confirmed that it has applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a group of 11 countries that includes major agricultural exporters such as New Zealand and Australia.
The concern is that the UK sells services to these countries in exchange for agricultural goods.
“The real challenge for us is that we are not sacrificial lambs in all of this. Trade is everything for the future of farming,” said Batters.
She did accept that the main UK supermarkets tend to be loyal to UK produce, and offer clear labelling to consumers, who can then make informed choices.
“The danger comes in out-of-home, which is a market that is not transparent,” she said.
Also commenting, UFU president Victor Chestnutt suggested that farming unions should look to replicate in the UK beef sector the work done by the Irish Farmers’ Association (IFA) to verify the origins of pigmeat.
The IFA set up a system to DNA test all boars in Ireland, and use this database to confirm whether pork products on shelves originate from Irish herds.
“A lot of people don’t know that when they go out at night for a steak, that it could be brought in from anywhere in the world,” said Chestnutt.
Disruption to the trade of goods from Britain to NI as a result of new rules introduced from 1 January 2021 under the NI Protocol is adding significant indirect cost to NI agri-food businesses, the president of the UFU, Victor Chestnutt, has claimed.
Joining other UK farming leaders at a NFU Scotland conference last Thursday, Chestnutt said that in some instances, these additional costs could amount to well over £1m annually to an individual food business.
Britain is by far the largest market for the NI food and drink sector, accounting for approximately half of all sales. But while NI can trade unfettered into Britain, the problem arises when trading in the other direction, and if freight companies are not doing back haulage, the cost of bringing back empty trailers falls to the company concerned.
“I was in my local meat plant this morning and was shown an email quoting £6,000 for empty trailers coming back from Scotland,” said Chestnutt.
Supply chain changes
He also referred to the recent letter sent by EU Commission vice president Maroš Šefcovic to UK Cabinet Minister Michael Gove, where Šefcovic refers to the “necessary adjustments of supply chains” as being part of the solution going forward.
“That is one thing I would worry about. I can see supply chains changing already, and as supply chains change and more food comes from Europe (through Ireland), that will increase our empty trailers and containers problem,” said the UFU president.
He also highlighted the issues that farmers face moving breeding sheep from Britain to NI, and the six-month residency period that would apply if a NI pedigree animal is taken to a show in Britain, or is taken to a sale, but remains unsold.
In addition, Chestnutt pointed to the new requirement that agricultural machinery moving from Britain to NI must be accompanied by a plant health (phytosanitary) certificate to verify that it is free from soil, etc.
“We need the UK and the EU to sit down and sort some of these things out. Solutions could be found if that political will is there,” he said.
Scottish president against aligning with EU rules
If the UK and EU agreed to align on sanitary and phytosanitary (SPS) rules, it would potentially reduce the trade friction for goods from Britain to NI and for Britain to the EU, but it is not something outgoing NFU Scotland president Andrew McCornick favours.
“We would be signing up to every rule set by Europe without us having influence on them. What we need, and what we should have got, is equivalence. There is no way their standards are higher than what we are producing to,” claimed McCornick at the NFU Scotland (NFUS) event last Thursday.
In last years’ trade talks between the UK and EU, the UK had sought both an equivalence mechanism for SPS rules, and reduced levels of checks at ports, but for that, the EU had pushed for greater regulatory alignment.
In the end, neither side was willing to compromise, leaving the so-called non-tariff barriers in place for goods crossing into NI and the EU in general.
“The future of alignment is very much an unknown. The UK has chosen to leave this as a very open area, yet to be defined,” added NFU president Minette Batters.
She described the EU ban on imports of seed potatoes from Britain (because the EU did not recognise the regulatory standards in Britain as equivalent) as “a test case”, and agreed with McCornick that the UK should implement a ban in the opposite direction.
With the UK phasing in non-tariff barriers for EU imports, starting from 1 April 2021, and bringing in full controls by 1 July 2021 unless something changes, EU seed potatoes are set to be unable to move to Britain from the middle of this year.
Outside of the EU SPS regime, Britain can move faster on issues such as gene editing. In general, the view from UK farming leaders is that this technology does offer significant opportunities, such as lower pesticide usage in crops and higher productivity.
But it is important to keep consumers properly informed, avoid different approaches being adopted in devolved nations, and to be aware of any unintended consequences.
“If [as a result of gene editing] we lose access to the EU, I think we lose all the benefits,” warned Batters.
English Ag policy a game changer – Batters
The plan to remove all direct payments to farmers in England by 2028, and replace the system with one based on “public money for public goods” is a “game changer” that is not being adopted by any other country in the world, maintained NFU president Minette Batters.
She described the policy as a “big step back from food production”, although she did claim that lobbying by the NFU has meant “we are inching them in the right direction” towards a discussion about sustainable farming.
Across all devolved nations, she believes the Scottish have it right by talking about sustainable farming, but also recognising challenges the industry faces around volatility, the need to produce affordable food and to keep farmers farming the land.
“I would far rather be talking to Fergus Ewing (Scottish cabinet secretary) at the moment than George Eustice (Defra secretary). Scotland gets the prize at the moment for the most constructive thinking on the future of agricultural policy,” she said.
Alarm at animal transport proposals
UK government proposals to ban the export of animals for fattening or slaughter, limit journey times for livestock in transport and impose new rules around ventilation in trailers were roundly condemned by farming leaders last Thursday.
The proposals apply to England and Wales only (Scotland is consulting separately), and are currently out for public consultation. Included in the consultation is a proposal that livestock journeys must only take place when external air temperatures are within 5°C – 30°C. Outside of this range, the vehicle must be fitted with a temperature control system.
“When we first saw it, there was enormous shock. It is completely and utterly bonkers,” said Batters.
“It is absolutely mad” added her Welsh counterpart, John Davies.
Given the negative reaction, it is expected that the proposal on minimum and maximum temperatures will be dropped, but big concerns remain, including on the distances that animals for slaughter will be allowed to move in future.