Food security matters. Much like energy security matters. Much like access to basic commodities. There are fundamental matters of supply that must not be ignored. International trade is a two-way street. But it must be a two-way street on the level. It’s possible to imagine a set of scales where there’s a balance between both sides. Maintaining that balance is a dynamic business.
It’s easy to understand how aggrieved farmers in Europe feel if they are subject to unfair competition. It’s the same in the UK. If say, meat comes into the UK, produced at a lower standard than domestic produced meat, and that undercuts farmers prices, that’s unfair and unwise.
News doesn’t just concern agriculture. Over the last weeks discussion about the UK’s ability to produce basic commodities, like steel, has occupied minds. Imports maybe cheaper. The trouble is that countries jeopardise domestic security and merely offload environmental concerns by increasing dependency on others beyond certain points. A sensible balance must be struck.
Political, marked trade imbalances are a nightmare. British farmers may not be so overtly militant as some on continental Europe, but they have a strong interest in influencing what laws say. Bandwagon jumping politicians from the far-right and far-left are taking advantage of the discontent that exists. None of these empty barrels have answers. That doesn’t stop them making a lot of noise.
Post-COVID, in all sorts of industries, there’s been, and still is, significant supply chain problems. For example, the price of farm machinery has gone through the roof. Although general inflation appears to be slowly coming down the hike that has happened, has happened. It’s bedded in.
Looking at the gap between input prices and outputs shows an unhealthy situation[1]. Producers have been squeezed. Their margins have been squeezed. It’s certainly not a good time to be a milk producer[2]. Even with optimism for the longer-term, today’s bills still need to be paid.
In the UK, there’s an often written about concern surrounding the power of the established major supermarkets[3]. These are almost monopolistic in their position in the marketplace. On the walls of their food warehouses pictures of smiling farmers and clean, shiny tractors are all the rage.
Because so much food goes through the doors of the supermarkets, if farmers want to protest, they are probably a better target than the UK Government. Alternatively, British farmers may need to work to reduce the influence of the middlemen. Going direct to the customer may not be for everyone but more could be done.
In a General Election year, it unlikely that politicians will pick a fight with British farmers. Their ears may prick-up for a short while. That’s a good time to make the case for domestic production.
[1] https://www.gov.uk/government/statistics/agricultural-price-indices/agricultural-price-indices-united-kingdom-november-2023
[2] https://www.nfuonline.com/updates-and-information/dairy-producers-braced-for-an-uncertain-future-nfu-survey-reveals/
[3] https://www.statista.com/statistics/280208/grocery-market-share-in-the-united-kingdom-uk/
John Vincent 