Trading uncertainty 'crippling East Anglian cereal growers',
PUBLISHED: 17:56 28 March 2019
East Anglian cereal farmers are already feeling the chilling effects of Brexit uncertainty and could be crippled by cheap imported grain coupled with hefty export tariffs, a Suffolk cereal farmer fears.
Tom Jewers, who farms at Rattlesden, near Stowmarket, said the uncertainty meant European Union (EU) buyers are holding back because of pricing uncertainty, and warned more delay on the Brexit issues would be “catastrophic”, with grain being stockpiled on farms.
The National Farmers’ Union (NFU) has warned that the UK arable industry is already feeling the impact of the uncertainty. Typically, UK grain exports to the EU are worth £514m but with no clarity around future the future trading relationship and what tariffs will be imposed, farmers and the wider supply chain is struggling to plan ahead.
“We are already in a position where we cannot even get a price offered for grain for harvest movement onto an export boat because EU buyers do not know what tariffs may be imposed on that produce come the time of movement,” said Mr Jewers.
“If the delay extends to the end of June as was mooted a week or so ago, this would prove catastrophic as we could have stockpiles of grain on farm unable to move, and potentially left outside while we wait to find a home for it.”
More than most other sectors, agriculture needed long term planning in order to mitigate against market volatility and is likely be hit hard by Brexit, whatever the outcome, he said.
“This increased uncertainty will exacerbate the impact and hit cashflows hard. Government has suggested zero import tariffs on grain imports - which are likely to be produced to standards well below our own, in many cases grown using chemicals which are not allowed within the UK. A flood of cheap imported grain coupled with hefty export tariffs could cripple East Anglian farmers.”
The NFU said trading opportunities with the EU were becoming “increasingly limited” for the UK arable industry because of uncertainty, with the wider supply chain struggling to plan ahead, exposing farmers to risk.
NFU combinable crops board chairman Tom Bradshaw, who farms at Fordham, near Colchester, stressed the need for a deal enabling a free flow of products between the UK so farmers could plan.
Matthew Jewers, managing director of Woolpit grain merchants Jewers, said the period of indecision was having a “profound” effect on grain markets.
“Shippers of grain are reluctant to place any new business as there is no certainty on potential tariffs that could be applied,” he said.
“This in turn means that the domestic market somewhat stagnates and feed barley prices in particular have plummeted.
In addition, businesses’ forward investment plans are on hold until we have any certainty in how our partnerships with the rest of the world will look.
“It is all extremely frustrating and it seems that we are no closer to a resolution that we were two years ago.”