Jeremy's Blog - 4th June 2020
Looking beyond the virus restrictions, virtually every lobby group argues that its cause is further validated by the experience of the pandemic and the measures taken to tackle it. Those competing perceptions will frame the arguments we will see later this year.
The largest arguments may be over the shape of future economic policy. Will there be a simple imperative to achieve recovery or will that be consciously built around climate change, environmental and other green objectives? What might change in supply chains?
Obscured by the restrictions, the increasing impact of climate change continues, witnessed by the winter’s flooding. Deferring mitigation and adaptation will make that work more demanding. People have seen clearer and less cloudy skies enabling solar energy to reach a record output on April 20th, 30 per cent of the reduced UK’s electricity demand. Renewables reached 60.5 per cent of demand on one day in April – testing the ability of the grid and leading to wind farm shutdowns.
Farming will seek its place in the re-making of global supply chains, pointing to the UK’s exposure with a 60 per cent self-sufficiency ratio reflecting static production and a growing population. Many will argue for strengthening home production (and implicitly exports); others that the current supply chains have substantially worked, aided in part by the “No Deal” Brexit planning for disrupted supply lines.
Improving output requires tackling productivity, improving efficiency and output at prices that compete with foreign production in home and export markets. Building buffer stocks, like Switzerland, would not be a permanent increase in demand. Instead, it requires substantial business improvement and change while delivering on climate change and environmental goals; rolling current support forward will not do that.
In one trend, it might now be that over a third of agricultural output by value comes from protected, covered or indoor farming, perhaps twice the value of the cereals sector. Crops under plastic and in poly-tunnels, indoor dairying, pigs and poultry are now joined by the early growth of controlled environment farming, whether large areas of glass houses heated from sewage plants or “vertical farming”. Such use of technology and investment may be one way to answer the need for a more competitive, more profitable farming sector.
Another is to achieve access to farmland for the best people to face the coming challenges, helping some to find value and virtue in seeing their land farmed well by others.