Food security – our increasing dependency on imports

Green and pleasant land

Sir James Dyson, the inventor, designer and entrepreneur, and one of Britain’s richest men, has invested a substantial part of his fortune in England’s green and pleasant land. Dyson Farming (private), an enterprise which apparently takes up most of Sir James’s time these days, owns about 36,000 acres of prime land in Lincolnshire, Gloucestershire, Oxfordshire and Somerset. The 29,000 acres in Lincolnshire are all arable – mainly wheat, barley, peas and fruit. The rest is pastoral – mostly grass-fed beef and sheep. Sir James clearly regards farming as a business, even if it is also his passion: “Farming is a form of manufacturing” he told the commentator Charles (Lord) Moore.

Dyson Farming ‘manufactures’ 750 tonnes of strawberries a year (most of which are sold to Marks & Spencer), in 72 kilometres of greenhouses which are heated by their own power supply. In the future, these strawberries will be picked by robots but thus far the company has not quite cracked this technology. Apparently, the robots’ colour recognition is upset by the LED lighting. Eventually though, it is hoped they will be able to work round the clock. The business also uses drones and computer mapping.

Much of the energy for the Lincolnshire operation is generated by two large anaerobic digesters (ADs) which could power 10,000 homes by using dung. Any power not used on the farms is sold into the National Grid. The waste product from the ADs (known as digestate) is used as fertiliser. This is called ‘circular’ farming.

Dyson wants, as far as possible, to cut out the middlemen, and is selling organic-meat boxes directly to consumers online. Currently, the Lamb Winter Box, consisting of two lamb chops, diced lamb, lamb mince and two lamb shanks costs £63.50 including delivery.

Sir James is not the only British A-lister to be captivated by farming. Jeremy Clarkson has turned his 1,000 acres in the Cotswolds into a TV phenomenon with Clarkson’s Farm, on Amazon Prime. It has been hugely popular, not least with farmers. The BBC also has a series about the former Emmerdale actor and Strictly Come Dancing winner, Kevin Fletcher, taking on 120 acres in the Peaks. Soon, celebrity chef Marcus Wareing will be broadcasting from his 65-acre smallholding in East Sussex. Oh, and Martin Clunes has a farm in Dorset, Paul O’Grady still has his smallholding in Kent and Sting has a vineyard in Tuscany…

James Rebanks, one of Britain’s most famous farmers, has made a supplementary income from his best-selling books about life on his hill farm in Cumbria, which relate just how hard farmers’ lives can be. Farmers may be up against the wall right now, but their work has never been so much in the public eye as it is now.

The total number of UK farm holdings declined by 35 percent to just over 185,000 between 2005 and 2016, according to Eurostat. The average age of a British farmer is around 60. A study last year by the Farm Safety Foundation found that 88 percent of farmers under 40 admitted to poor mental health.

Pig farmers have been in the anguished position recently of having to cull their animals without putting their meat into the food chain because of a lack of abattoir workers. Labour shortages are widely blamed on Brexit but have undoubtedly been exacerbated by the pandemic. Another cause is that a Chinese ban on pork produced by Norfolk producer Cranswick has resulted in a glut. But this looks to me – as my friend Evil pointed out here on Wednesday – like monumentally bad planning.

Meanwhile, back in Westminster…

Under the new ELMS programme that will apply in England, farmers will receive “public money for public goods”. English farmers will be encouraged to act as custodians of their land. That is all very well, but will they be incentivised to produce more food for a densely populated nation? Food, and of course water, are primal “public goods”.

It seems that, once again, the devolved governments are diverging from Westminster. While the English system effectively junks the EU Common Agricultural Policy (CAP), Scotland, Wales and Northern Ireland are set to retain something substantially like the old dispensation. Under the CAP, British farmers received £3bn a year from Brussels. The new system of Environmental Land Management Schemes seems less inclined to subsidise food production and more likely to subsidise land management.

Minette Batters, president of the National Farmers’ Union (NFU), has expressed alarm over the government’s failure to spell out exactly how ELMS, due to go live in 2024, will work. ELMS has three main strands: the sustainable farming initiative; a local nature-recovery strategy; and landscape recovery. But what about food production?

Batters fears that subsidies available for rewilding will encourage some landowners to take back control of tenanted farms, which make up about one half of the total, and get paid a proposed £2,335 per hectare just for letting nature take over. Happily, there are still some stolid English farmers who are turning their backs on subsidies and relying on getting decent prices for excellent products in the open market.

The other concern that British farmers harbour at present is the outcome of the various trade deals signed thus far or under negotiation since Brexit. Batters thinks that the government has given Australia “the best deal they have ever had” – at the expense of British farmers who will have to comply with more onerous rules (for example, concerning animal welfare and pesticides) than their overseas tariff-free competition.

Beef is a case in point – but the UK is not self-sufficient in beef, so if we don’t import from Europe we shall have to import from somewhere else, as indeed we do. The prospective trade deal with Canada may prove even more controversial. And the UK cannot risk falling out with a close Commonwealth country that could smooth the path to joining the Trans-Pacific Partnership.

Most British shoppers want to buy British food, especially British meat – and supermarkets like ALDI, Lidl, Marks & Spencer and Waitrose have distinguished themselves in this regard with clear labelling. Many shoppers, however, do still go for price over provenance.

As if British livestock farmers haven’t got enough to worry about, a growing body of vegans think their products are unhealthy, bad for climate change and even immoral. Several councils, including Oxfordshire, which is run by a coalition of Liberal Democrats and Greens, have moved to become “meat-free zones” – even though beef and sheep farming is an important part of the county’s economy.

Squeezed like the rest of us by rising prices, especially fuel prices, British farmers are obliged to be entrepreneurial. They run farm shops – though not all attract celebrity shoppers, like Jeremy Clarkson’s Diddly Squat Farm Shop. They deliver ‘veg boxes’ and run holiday cottages and wedding venues. Some also provide glamping facilities. But farmers face a notorious array of red tape for running such businesses – even opposition. The decision by Oxfordshire Council to refuse to allow Jeremy Clarkson to build a café next to his farm shop has been widely cited as an example of what British farmers must put up with.

Solar power and biofuels compete for land

Thousands of acres of good agricultural land are likely to be used to build solar arrays in Britain’s push to get to net zero carbon by 2050. That could take up to an estimated 150,000 acres of land out of food production, thus reducing the nation’s capacity to feed itself. Net Zero Watch, a campaigning organisation that monitors the impact of poorly thought-out climate-change policies, thinks that this could increase Britain’s existing dependency on food imports. It proposes that planning laws be changed to remove the current presumption in favour of solar farms.

There is a growing row over a plan to build one of the UK’s biggest solar arrays on a stretch of prime agricultural land stretching from Lincolnshire to Rutland. The Mallards Pass Solar Farm will supposedly generate enough electricity to power 92,000 homes. Another solar project is the proposed 2,400-acre Cottam Solar Project on the Nottinghamshire-Lincolnshire border; and then there is the 2,792-acre Sunnica Energy Farm on the Suffolk-Cambridgeshire border, which I wrote about recently. There are others in the pipeline such as a 1,400-acre development near Chelmsford, Essex. All these sites will encroach on some of the most fertile agricultural land in Europe.

Another form of supposedly renewable energy which is taking land out of food production is biofuel (biomass). A study by Rothamsted Research concluded that, in the EU, incentives to farmers to produce biomass such as oilseed rape (rapeseed) gave rise to perverse consequences. The amount of farmland cultivating rapeseed rose by 78 percent between 2003 and 2015 – and pests thrived, especially given the (justified) ban on neonicotinoids. As a result, imports of tropical palm oil soared – a product that is responsible for the destruction of rainforests. This is a classic example of something I have discussed before – that by being virtuous at home we encourage more CO2 and environmental desecration abroad.

Forests and peat bogs

The Westminster government has cooked up another target, to protect 30 percent of the UK countryside by 2030 – dubbed (inevitably) “30 by 30”. To achieve this, local agencies will have to restore peatlands and plant trees, so the new Landscape Review, authored by environmentalist Julian Glover, entails (you’ve guessed it) a “Trees Action Plan” and a “Peat Action Plan”. The latter aims to restore 35,000 acres of peatlands by 2025.

Unfortunately, however, the Forestry Commission has spent recent decades carpeting former peat bogs with Sitka spruce, a non-indigenous, fast-growing pine tree. This unwelcome incomer does little to encourage local flora and fauna which is what “creating diverse landscapes” should be about. About 20 percent of the Northumberland National Park is covered in Sitka, and the tree-planting targets could entail the Commission planting even more. Incredibly, England’s national parks currently do not have planning powers over forestry – and the recent Landscape Review does not address this.

For its part, the Forestry Commission claims to be committed to the establishment of widescale, broad-leafed woodlands. It now forbids new plantings on deep-peat or single- species plantations. It argues that there must be a role for sustainable conifer plantations if we are to reduce our 80-percent dependence on imported timber. The Commission, which is the largest landowner in England, manages 8,000 hectares of protected, upland bogland of which 75 percent is said to be in good condition.

Meanwhile, a study by ecologists at the University of Plymouth has found that livestock grazing can boost reforestation. The government wants to plant 30,000 hectares of new woodland by the end of this parliament (2024?) and has earmarked £500m for that purpose. But saplings planted on uplands have only a small chance of survival and those that do survive may be stunted and thus sequester little carbon. Livestock grazing on the edges of oak woodlands can thin out dense vegetation, allowing the forest to expand naturally.

Peatlands once thought to be economically useless are now becoming the focus of a new breed of environmentally conscious investor as rewilding becomes a means by which large corporations and investment funds can offset their carbon emissions. It turns out that carbon credits are worth more than grouse shooting and deer stalking. According to the land agency Goldcrest, the price of Scottish peat bogs per hectare has rocketed during the pandemic.

Standard Life Investments Property Income Trust bought nearly 4,000 acres in the Cairngorms National Park last September. It plans to plant 1.5m trees there. Aviva Investors has bought 15,000 acres of Aberdeenshire with Par Equity. BrewDog, the Scottish craft-beer brewer, bought the 10,000-acre Kinrara Estate near Aviemore in January 2021.

But some environmentalists question whether such entities really understand how to manage the land. Reportedly, the gamekeepers on the Kinrara Estate are not happy. As well as planting trees, BrewDog plans an eco-hotel, an outdoor centre and a new distillery. The Japanese brewer Suntory, which already owns the Laphroaig whisky distillery on Islay, has been involved in a number of conservation projects in Scotland. The company plans to restore 3,200 acres of Scottish peatland by 2030.

What if global warming were good news?

The science writer and polemicist Matt (Lord) Ridley thinks that we should think about global warming in a new way. It is fashionable to talk about a “climate crisis”, but some aspects of global warming could be beneficial for farmers. Given higher levels of CO2 in the atmosphere, and greater rainfall, trees, grasses and other vegetation grows more profusely and more rapidly. In a recent blog piece Ridley references the Danish climate sceptic Bjorn Lomborg who has studied NASA data. Lomborg argues that the area of the earth’s surface covered by vegetation is growing by over 600,000 square kilometres every year thanks to “global greening”.

Everybody agrees that in the last 40 years the amount of CO2 in the atmosphere has gone from 0.034 percent to 0.041 percent. With more CO2 in the air, plants don’t lose so much water through their stomata (pores) and can survive and even thrive in dry regions such as the Sahel in Africa. Moreover, winter night-time temperatures in the global north are rising much faster than summer daytime temperatures in the tropics. Therefore, crops that are vulnerable to frosts may be able to thrive at more northerly latitudes, and growing seasons will be longer. IPCC data suggests that periods of drought are becoming less frequent, and flooding is getting worse only where human-induced, land-use changes create problems (such as deforestation or building houses on flood plains).

Ridley points out that we are feeding over seven billion people today more easily than we fed a global population of three billion in the 1960s, and with a similar acreage of land under cultivation. Global cereal production is on course to come in at record levels this year, for the sixth time in the last 10 years. DEFRA Secretary George Eustice MP told the NFU Conference in Birmingham this week that the temperate regions of the world, which includes the UK, will experience growing demand for their produce as temperatures rise.

Perturbations in global food markets

The war in Ukraine, with Russian forces now inside the country’s territory, is causing extreme volatility in global food markets. These are especially severe in the Middle East and North Africa where people face severe food shortages. Russia is the largest exporter of wheat in the world and Ukraine itself is not far behind. Ukraine accounts for 12 percent of global wheat exports, 16 percent of corn exports and 19 percent of rapeseed. Fears that grain supplies will be restricted, not least by blockades in the Black Sea, have sent spot prices soaring.

In much of the Middle East and North Africa, food prices have reached the levels prevailing before the Arab Spring (2011). Lebanon was already in a state of near economic collapse, with frequent and sustained power outages, which in turn are affecting the water supply. Some observers fear that its people are facing extreme food insecurity if not famine. Egypt, with a population of over 100m people, is the world’s largest importer of grain. The price of bread there has sparked riots in the past. During the Arab Spring which brought down the regime of Hosni Mubarak, “bread and freedom” was a popular refrain.

Food shortages could soon be compounded in Egypt and elsewhere in the short term by the energy crisis. This in turn is likely to exacerbate the flow of migrants heading from the global south to western Europe and North America.

The example of agriculturally vulnerable nations like Egypt should remind us here in these islands that dependence on imported food should not be taken for granted. We have an energy crisis (as I discussed last week) because we have been insufficiently vigilant about energy security; we might soon have a food crisis because we have been lax about food security. It will no doubt be uplifting to watch beavers frolic in newly rewilded spaces, but it might not be so enjoyable if our stomachs are empty.

One lives in hope that the British political elite, which is increasingly blown about by the intellectual weather rather than by core values, gets the message. They allowed British manufacturing to go to the wall; the thought that they might let British agriculture go the same way is unbearable.

PS:

The thing that we had all feared has happened. Russia under Putin has made a full-scale invasion of its (almost) democratic neighbour, Ukraine. People are dying as I write. Europe, the US and the whole world has entered a very dangerous corridor of history in which the downside risks are, frankly, awful.

I don’t think this is the beginning of WWIII; but I think the chances of China seizing Taiwan while the US is distracted are significant. Unfortunately, it is very unlikely that there will be any kind of happy ending to this drama in the short term. On the other hand, I think that in the medium term, we’ll see that an increasingly unhinged Putin has fundamentally miscalculated.

I’ll explain why next week − and reflect on what investors do in times of war.

Listed companies cited in this article which merit further analysis

• Marks & Spencer (LON:MKS)
• Cranswick PLC (LON:CWK)
• Suntory (TYO:2587)