A useful harvest in the barn, got cheaply. Grain prices at near record highs. ELMS due to replace Basic Payment. What could possibly go wrong for arable farmers in Great Britain in the next few years?
The great post-Brexit threat to our livelihoods, of course, is the possibility that our government will do trade deals that will see us undercut by grain from low-cost grain exporting countries.
News that the UK is on the point of reaching a trade agreement with New Zealand should not concern cereal growers in Great Britain as New Zealand doesn’t export grain. But the word is that Trade Secretary Liz Truss is prepared to eliminate tariffs on imports of New Zealand honey, wine and apples. If I kept bees, had just planted some vines or earned my living tending an apple orchard that news would worry me greatly.
It’s not that our apiarists, viticulturists and apple famers should fear a sudden flood of imports the moment Truss signs a deal. Rather, it is the medium and longer-term implications that are of concern.
New Zealand cannot immediately increase its production of these commodities but, with tariffs removed and greater profits available, it means that new hives will gradually be installed and new vines and apple orchards planted. No, the flood of production will come in a few years’ time.
That was certainly my grandfather’s experience as a Sussex arable farmer in the 1920s, when we were exposed to the effects of ‘free trade’ in grain. Despite promises that trade protection for agriculture would only be wound down slowly after the First World War, the government in fact repealed the ‘Corn Production Acts’ in August 1921 and immediately exposed farmers to cheap grain imports (with a paltry bribe of £3 an acre to help them make the transition).
With import tariffs and guaranteed prices removed, his livelihood became unstable, but things didn’t really go wrong for my grandfather for a further four or five years. This is how long it took to build the infrastructure to import large tonnages of cheap grain into the UK and for wheat production in the US mid-west to increase to take advantage of the opened market.
Is history about to repeat itself? It’s too early to say, but we do know that, unlike red meat and dairy, our government does not consider cereals a ‘vulnerable’ farm sector in need of tariff protection.
So I suggest we need to keep our fingers firmly crossed but brace ourselves for when trade deals are done with low-cost grain exporting countries like Ukraine, Brazil or Argentina.
