Friday 7 February 2020

Beef

Fishing (0.1%) and agriculture (0.51%)  contribute minuscule amounts to the UK national economy, yet they have an emotional pull out of all proportion to their economic significance. The proposition that both would thrive outside the bureaucratic EU must have swayed more voters than were actually engaged in those activities to vote Leave in 2016.

Prime minister Johnson has declared himself prepared to make fishing rights a sticking point in free trade talks with the EU. Yet there is a strong sense among farmers, especially livestock farmers, that the Tory government is about to sell them out. Dominic Raab is in trade talks in Australia, keen to reduce its dependence on Asia for a major export, beef. Forty per cent of Australian cattle are hormone-treated to accelerate their fattening, a practice banned within the EU.

Worse is hinted at by an article in the current Private Eye:

At the recent UK-Africa investment summit in London, PM Boris Johnson declared that "Uganda beef will have an honoured place on the tables of Britain" after Brexit. [...] farm organisations have been deriding the environmental and food safety credentials of Ugandan beef, pointing out that no Ugandan slaughterhouse is yet licensed to export to the EU.

Tariff barriers depress the price to farmers from LED countries such as Uganda.
In turn, this prevents them earning enough to upgrade production methods and improve traceability and environmental standards to levels acceptable to consumers and regulators in higher income countries like the UK.

The Common Agricultural Policy (CAP), especially the way it benefits German and French farmers, is probably the least defensible of EU mechanisms and was always high on the list of improvements to be sought by a Liberal Democrat administration in our manifestos. (CAP currently also benefits large landowners disproportionately, which could account for the lack of pressure for reform from Tories on the Council of Ministers.) However, there is an obvious solution for the UK which would encourage free trade while maintaining standards and supporting a farming industry at home. I quote from a former Conservative correspondent, a land agent in the days before accession to the CAP:

Pre CAP the UK had a most excellent system called Guaranteed Prices.

The UK food market was freely available (with the proviso of quality 
controls) to the entire world and UK farmers agreed minimum prices with 
MAFF [the Ministry of Agriculture, Fisheries and Food] annually on most items 
(but on a 2 yearly basis for beef.) 

If the world price exceeded the guaranteed price, the farmers sold their 
produce and HMG paid farmers nothing but if world price fell to less than 
the guaranteed price, the farmer would sell his produce, send his receipts 
to MAFF and get a cheque for the deficit.

The system was simple, cheap to run and resulted in cheap food for 
consumers.

One wonders why Johnson does not adopt it.

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