The gathering storm: Farmers fear unprecedented challenges from the triple threat of pandemic, Brexit and global warming

Experts warn of devastating impact as rural economy bears brunt of coronavirus, floods and recession

Farmers in Scotland are facing the most challenging times for generations due to a perfect storm of Covid- 19, Brexit and global warming, experts have warned.

Every agricultural sector has been hit by turbulent markets creating an unprecedented climate of uncertainty for farmers.

A slump in consumer confidence and the prospect of a deep recession have changed the nation’s shopping habits while farmers have been forced to adapt to find alternative markets for their produce, and will have to compete for business on new terms once Britain leaves the European Union.

The cumulative effects of more extreme weather have also had a devastating impact on crop yields due to periods of drought and flooding.

Paul Flanagan, Scotland director of the Agriculture and Horticulture Development Board, said: “It’s been as challenging as it ever has been in farming. No matter how good a farmer you are, there are challenges there which are outwith their control. It’s going to be quite a bumpy road from here.

“Covid has had a massive impact on the way we live and our attitudes and behaviour. From a trade deal perspective, we’re going to be leaving the EU. It’s going to be challenging in the short to medium term. Then Scotland is not unaccustomed to challenging weather, but for agriculture, it’s the cumulative effects.

“Individually, we get through the different problems, but collectively they add up. Whether it’s lower yields, higher costs or a combination, it’s impacting on the bottom line for farming businesses.”

Farmers in Scotland had already been facing complex pressures before the coronavirus pandemic. The 2016 decision to leave the EU had left growers and producers facing renegotiated trade deals and increased competition from major agricultural exporters such as the US, New Zealand and Australia.

A series of extreme weather events since 2018’s drought also had a catastrophic effect on yields of crops and grazing for livestock.

The National Farmers’ Union Scotland has also revealed the stagnation of prices received by some producers, in some cases flatlining over almost quarter of a century:

● This month, the average price that dairy farmers will receive for milk will be around 27p per litre. The average milk price received by farmers in July 1996 was 26.7p per litre

● Strawberry values have “remained static” since 1996 despite increasing grower costs

● Wholesale egg prices are the same today as they were in 2011

● The retail price of beef mince today is the same as it was nine years ago.

The NFU has also warned that this year’s wheat harvest could be down by a third – the worst since the 1980s – due to a wet February followed by a hot, dry spring. Andrew Barnes, a professor of rural resource economics at Scotland’s Rural College, said Covid-19 inflicted a “demand shock” on supply chains, though they proved to be robust.

But he believes uncertainty about the future makes farmers reluctant to make investments to boost resilience in the agricultural sector.

He said: “Uncertainty in the long run affects you because if you’re not investing in the business then you’re going backwards.”

Professor Barnes led a project funded by the Scottish Government to identify measures which could help increase productivity and efficiency for farmers, with education emerging as a key area for intervention.

He said farmers needed to be encouraged to become more entrepreneurial to help them make the most of consumer habits switching to favour local produce.

They also need to prioritise good business management practices such as record- keeping, and make sure they are getting maximum use from hi-tech agricultural machinery.

Prof Barnes added: “The productivity project we did was about resilience, and how we can manage that resilience given the fact that farming naturally has these ups and downs but it also has big shocks. It gets through it so you do have this perfect storm. It’s about changing consumption patterns as well.

“If we are heading to a no- deal Brexit then there will be some significant issues for our trade in terms of where we’re selling to, the cost of it and imports as well. I would say Brexit for most sectors trumps Covid in terms of the risk.”

But coronavirus also caused major upheaval, particularly due to the shutdown of the food service industry.

Thousands of litres of milk – which

would normally have been used in coffee shops or for cheese on pizzas – had to be poured away because it could not be stored.

Demand for malting barley used by brewers and distilleries also slumped due to pub closures, and recorded its lowest June figures since 1990. Some farms were also affected as their staff work in close proximity or needed to shield or self- isolate, leaving them struggling to harvest fruit or care for livestock.

Pork remained in high demand as an estimated 80 million bacon sandwiches were eaten during lockdown but the price is now predicted to slide. But in the three months to June, British dairy farmers lost out on more than £ 41 million as milk prices were slashed. Sales of beef mince in the retail market rose by 10% in the four weeks to April 19, but less steak was sold, meaning the price of beef fell to its lowest weekly average in more than five years.

Duncan Macalister, who keeps 150 breeding cows and 650 ewes on his 2,000 acre farm near Tarbert, Kintyre, survived the BSE and foot and mouth crises but said: “Covid and Brexit together could really be a shambles.”

Mr Macalister said: “A lot of the problem has been the consumer and a whole generation who can cook mince, steak and a burger and that’s about it.

“For a while it was pretty dire. Going forward with Brexit on the horizon, that could really screw everything up for farmers if we crash out of Europe with no deal.

“We have seen uncertainty before but this coming out of Brexit could almost be the perfect storm.

“We’ll just have to find a way round it as that’s what farmers do, we’ll tighten our belts and have to suck it up because we have no other choice.”