Britain braced for food crisis as rising costs hammer farmers

Feed, fertiliser, fuel and labour costs have all risen dramatically in the past 12 months, squeezing margins from profit into loss.

With some sectors forced to rein in inputs this will lead to reduced yields and production, according to NFU head of food policy Jack Watts.


Left unchecked, there could be double-digit cuts in output across all sectors of UK food production, he says.


Those output cuts could bite as early as the autumn, with wide-scale shortages an even greater likelihood in 2023.


Surging energy prices are central to the potential cutbacks in output.


Farming systems depend heavily on energy for fertiliser manufacture, food storage, crop drying, milk pasteurisation and for heating everything from glasshouses to livestock sheds, Mr Watts says.


Since Russia invaded Ukraine in February, energy costs have gone through the roof.


Soaring fertiliser prices


Fertiliser prices have risen as high as £1,000/t in recent weeks, compared with £250/t a year ago.


Farmers are facing key purchasing decisions in the coming weeks and months. New season buying starts from June for arable growers, while livestock and dairy farmers often buy at first-cut silaging.


Ukraine also grows about 10% of the world’s wheat, and exports have slowed to a trickle since February. Next season’s grain crop is shrouded in uncertainty with men of working age fighting and millions fleeing the country.


How this will affect the harvest and what the knock-on for next year will be is hard to gauge.


But the dire situation facing food in the UK cannot be blamed on the Ukraine conflict alone, says Mr Watts. Input prices and post-Brexit policies were already causing pain long before the Ukraine conflict.


The war has only worsened an already serious situation and shone a light on how much our food supply is increasingly in the hands of other nations, Mr Watts says.


Labour crisis


Labour recruitment now the UK is outside the EU is a major problem. Tougher post-Brexit immigration laws have imposed limits on overseas workers, threatening harvest and processing to the point where farmers are being forced to cut production.


The environmental policy is another major issue. The UK government wants farmers to farm hand-in-hand with the environment, but this carries a risk of overshooting on rewilding and big carbon offsetting for corporate gain.


The losses of productive land to trees and solar panels will inevitably cut outputs, further increasing long-term dependence on imports, Mr Watts says.


Neil Parish, Conservative MP for Tiverton and Honiton, and Environment, Food and Rural Affairs (Efra) select committee chairman, says the Ukraine conflict should have woken us up to the fact that the future does not lie in importing food.


The government, Home Office and Defra must do more to support food production, he insists.


A recent report by the influential cross-party committee warned that government had to address the post-Brexit labour shortage to avoid permanent shrinkage of the food sector.


Last year, 67% of seasonal farmworkers in Britain were from Ukraine, and a further 7% were Russian, Mr Parish points out.


That is almost three-quarters of the potential workforce that will not be heading to the UK this summer. Without workers, fruit and veg won’t get picked and cows won’t be milked, he warns.


Mr Parish says the Home Office had pinned its post-Brexit hopes on a flow of UK labour to farms.


Lack of understanding


But he believes this shows a lack of understanding of the situation. People who already live in the UK live in fixed locations and cannot, or will not, move to the seasonal work when and wherever it arises.


When Britain was still in the EU, the overseas workers were mobile and with few ties, suiting the jobs available. When the work ended, they went home.


“We need, and very quickly, to have a seasonal workers scheme that mimics this and is attuned to allow the right number of workers in to do the jobs,” Mr Parish says.


He also criticises the lack of a cohesive strategy for farming, farmland and the environment.

The land area is oversubscribed and the country is expecting too much from it.


“We are asking land to produce food, offset carbon, harbour wildlife, produce energy and act as recreation,” he says.


A first step to a food strategy should be a land audit that asks what farmland can produce, where it is and what it is being used for. Then, the government could set priorities for food production.


Source: Farmers Weekly