A pivotal point lies ahead for industry
While there might have been a degree of political motivation behind claims last week that the Government was considering the slaughter of 9 million sheep as part of its contingency plans for a no-deal Brexit, it still created consternation among farmers.
And although Defra quickly denied such an approach had formed part of its worst case scenario bunker-planning, the story highlighted the magnitude of the problem which the farming industry will be forced to confront if Britain does crash out of the EU.
The drastic effect of skyhigh tariffs on many farm products going to the EU in such an eventuality would spell the end of beef and lamb exports to the country’s biggest overseas market.
The last time the sector faced such a dramatic market closure was during the horrendous foot and mouth outbreak of 2001, when the livestock industry – and much of the rest of Britain’s countryside – was brought to its knees.
In fact it was the prospect of a longer closure of this key market that saw a slaughter policy adopted to control the disease rather than a less draconian vaccination policy. While official estimates put the UK figure at just over four million sheep, cattle and pigs culled in that outbreak, others have put the figure at closer to 10 million, with the losses suffered by farming and tourism running into billions.
The fact that many of those leading the industry had lived through that compulsory slaughtering might have been a factor in the backlash against any widespread slaughter policy being adopted for Brexit.
Even although the plan
to slaughter 9 million sheep was flatly denied, it does reflect the fact that major structural changes are almost certain to be forced on the industry. With a total breeding flock of just over 14 million ewes, it wasn’ t clear if this was the sector to be targeted – but if the aim was simply to take prime sheep off the market then it would need to be an annual exercise to have any lasting impact.
Also revealed last week, a major report – which probably didn’t receive the attention it merited or which its expense de served – took a detailed look at the effects of different Brexit scenarios on the UK’S cattle and sheep sectors.
Produced by farm consultants at the Andersons Centre and funded by that joint levy spending agreement between the Agricultural and Horticultural Development Board, Quality Meat Scotland and its Welsh equivalent, it further confirmed the threats from a no-deal Brexit.
Using Andersons’ hypothetical, average performing livestock unit, Meadow Farm, which functions as a computer model to give a realistic assessment of different scenarios, the report showed that, while profitability fell from £93 to £68 a hectare if a deal was reached (due mainly to the effects of non-tariff impediments to trade such as border checks and haulage delays) the no-deal scenarios saw income flip to a £45-a-hectare loss.
Crucially, however, these figures included the full level of support measures currently available – but if these were removed the loss from production actually stood at £288 a hectare, a whopping £140-a-hectare worse than the current situation.
As was noted, however, farms have been resilient in the past and have often managed to keep going by tightening their belts and weathering losses which have occurred on an intermittent basis. But at this level of loss, attrition would soon set in and, rendered unviable, such farms would eventually disappear – stilling the beating financial hearts of many remote areas of the country.
Would it be allowed to happen? The political will to get out of Europe regardless of the cost seems to be growing and virtually every report into the effects on the UK’S economy would indicate that collateral damage doesn’t seem to be a major consideration.
I’m not sure if there was a single point at which the future of Britain’s other formerly great but now lost industries – such as coal mining and steel production – hinged.
However, it’s now certain that avoiding a nodeal Brexit will be a pivotal point for the fortunes not only for the livestock sector but also for Britain’s countryside as a whole.