Scottish Farmers Face Trade Fears

Fields of Doubt: How Global Trade Deals Threaten Scotland's Farms

A deep sense of unease is spreading through Scotland’s agricultural heartlands. While new global trade agreements promise access to distant markets, many farmers fear a rising tide of cheaper imports that could swamp their livelihoods. This apprehension was palpable at the recent Royal Highland Show, an Edinburgh-based cornerstone event for the rural community. Industry bodies like Quality Meat Scotland (QMS) are sounding the alarm, highlighting a fundamental conflict. The drive for a 'Global Britain' clashes with the urgent need to protect the nation's high-quality food production from being fatally undercut by a wave of foreign produce.

A Gathering Storm of Imports

Scotland's meat industry voices growing concern over the creeping influence of products originating from nations with new UK trade pacts. QMS has been particularly vocal, warning that items from agricultural powerhouses such as Brazil, Australia, and New Zealand could threaten the equilibrium of Scotland's food production system. The organisation is pressing government officials to evaluate the combined effect of all the agreements together, instead of analysing them as separate pacts. Sarah Millar, chief executive of QMS, stated that while the industry welcomes two-way trade, it must operate on a just and balanced foundation. She conveyed apprehension that the combination of all these separate trade pacts could ultimately create an unstable situation for the sector.

The Australian Precedent

Following the UK's departure from the European Union, Australia became the initial nation to formalise a commercial treaty in 2021. This arrangement became active in May of 2023. The deal involves a gradual phasing out of tariffs and quotas on agricultural goods over 15 years. This arrangement immediately prompted accusations from agriculturalists that the Conservative administration at the time had undervalued domestic markets during negotiations. The National Farmers Union (NFU) of Scotland criticised the deal for its lack of safeguards for domestic food security and for using agriculture as a bargaining chip to secure benefits for other sectors. The concern remains that this deal sets a dangerous precedent for all future negotiations.

A Mirror Image from New Zealand

The subsequent commercial treaty with New Zealand mirrored the Australian agreement, intensifying fears among Scottish producers. With tariffs on meat set to be eliminated, the deal poses a direct threat to Scotland's iconic lamb and beef sectors. NFU Scotland President Martin Kennedy described the government's handling of both the Australian and New Zealand deals as a failure, negotiated with political haste and without proper consideration for farmers. Analysis by QMS has previously shown that New Zealand's farmgate prices for beef and sheepmeat are significantly lower than in Scotland, highlighting the competitive disadvantage faced by domestic producers.

The Pacific Puzzle: CPTPP Accession

Adding another layer of complexity, the UK has formally joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This bloc includes major agricultural exporters like Canada and Mexico, alongside Australia and New Zealand. While the government promotes it as a gateway to fast-growing markets, farming bodies remain wary. There are significant concerns that joining the CPTPP could force the UK to accept food produced to lower standards, including items like hormone-treated beef, which is currently banned. The aggregate effect of this, on top of bilateral deals, raises profound questions about the long-term viability of Scottish farming.

The Numbers Game: A Deficit at Home

The challenge of competing with imports is compounded by a domestic production shortfall. Projections from QMS indicate that an additional 79,000 cows will be required by the year 2030 to substitute foreign beef with domestically raised alternatives. This figure translates to an increase of two cattle for every herd annually, with an even greater number necessary to support any growth in export activities. This highlights a troubling paradox: a clear need to boost domestic capacity at the very moment the market is being opened to vast, low-cost international producers. This situation puts immense pressure on a sector already grappling with its own challenges.

An American Opportunity?

Amid the concerns, some see potential bright spots. Farming unions suggest that a beef scarcity in the United States, a result of successive droughts shrinking their national herd, could open up a lucrative market for premium Scottish exports. Jonnie Hall, the policy director for NFU Scotland, has pointed to this as a potential trade opportunity that could benefit farmers. Successfully tapping into this high-value market could provide a welcome boost. However, accessing it depends on navigating a complex web of standards and regulations, a challenge that is far from straightforward for Scottish producers looking to expand their global reach.

The Unmovable Red Line: US Beef Standards

The prospect of increased trade with the US immediately runs into a major obstacle: production standards. A significant point of contention is the American use of hormone growth promoters in cattle, a practice banned in the United Kingdom. This has become a firm red line for British farmers and consumer groups, who insist that any food sold within Britain must comply with the identical high welfare and safety standards as domestically produced items. This principle stands as a critical test for the government's trade policy, with farmers watching closely to see if the prohibition against controversial American beef will be upheld in any future negotiations.

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A Question of Standards

The debate over hormone-treated beef is part of a much larger conversation about maintaining the UK's high animal welfare and environmental standards. The World Animal Protection Index gives the UK a higher grade for animal welfare legislation than Australia. Differences are stark in areas like livestock transport times, the use of CCTV in slaughterhouses, and painful procedures like mulesing of sheep, which is illegal in Britain but permitted in Australia. Farmers argue that allowing imports produced to lower standards creates an unlevel playing field, putting them at a severe competitive disadvantage.

The European Lifeline

Despite the global outreach of post-Brexit trade policy, the European Union continues to be their premier destination for exports. Recent data from QMS reveals that over 95% of Scotland's red meat export revenues, valued at a record £137 million between 2023 and 2024, came from EU markets. For Scotch Lamb, the figure climbs to 99%. Sarah Millar of QMS emphasizes that any new arrangements that simplify entry into European commerce would be viewed favorably by the industry, reinforcing its critical importance to the sector's financial health.

Navigating the Post-Brexit Channel

Recent agreements aimed at resetting the UK's relationship with the EU have been met with cautious optimism. The new Sanitary and Phytosanitary (SPS) agreement, for instance, is designed to reduce checks and paperwork, which have been particularly burdensome for exporters of perishable goods. While bodies like NFU Scotland appreciate the improved relationship, it remains anxious about the United Kingdom adopting EU regulations without having any influence on how those rules are created, a situation often described as being a "rule-taker" rather than a "rule-maker," which could create challenges down the line.

The Seed Potato Stalemate

No sector illustrates the challenges of post-Brexit trade more vividly than Scotland's seed potato industry. Prized for their high health status, Scottish growers historically exported around 20,000 tonnes to the EU annually. This trade effectively ceased in January 2021 when the EU prohibited imports from Great Britain. The seed potato sector estimates that the foreclosure of the EU market has resulted in a seventy-five million pound loss in potential earnings over the preceding half-decade. Farmers have been forced to find new, often more distant, markets to survive.

A Glimmer of Hope for Growers

Recently, there have been positive signs that the deadlock over seed potato exports could be broken. In June 2024, Defra's farming minister, Daniel Zeichner, confirmed the government's desire to see exports to the EU resume as soon as possible, acknowledging the disproportionate impact the ban has had on Scotland. This renewed political will received a positive reception from industry representatives and politicians like SNP MP Seamus Logan. While the practical details still need to be resolved, this shift in tone has sparked hope among growers that they may soon be able to reconnect with their most valuable and long-standing European customers.

A Dram of Hope: The India Deal

In contrast to the anxieties surrounding agricultural imports, the recent commercial agreement with India is regarded as a major victory for another iconic Scottish industry: Scotch whisky. The deal will see India's steep 150% tariff on whisky imports immediately halved to 75%, with a further reduction to 40% planned over the next decade. The Scotch Whisky Association has called it a landmark agreement, believing this arrangement could elevate exports to India by one billion pounds within the next five-year period, leading to the creation of approximately 1,200 employment opportunities throughout the United Kingdom.

From Whisky to Wheatfields

The benefits of the India commercial treaty ripple out from the distilleries and into the fields. Increased production of Scotch whisky will directly fuel demand for high-quality Scottish barley. This creates a significant opportunity for the nation's arable farmers. Near the Duns town in the Scottish Borders, an arable farmer named Neil White stated that with the right premium, he has the capacity to nearly multiply his current barley cultivation by two. He elaborated on his position at the very start of the production chain, highlighting the advantages of supplying a local, prestigious market.

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The Farmer's Perspective

Caught between complex global forces, the average Scottish farmer faces a period of profound uncertainty. While opportunities in new markets like the US or through the whisky supply chain exist, they are set against the immediate threat of low-cost imports from powerful agricultural nations. The consensus is one of apprehension and a need for clarity. As Jonnie Hall of NFU Scotland remarked, many in the industry feel they are currently attempting to forecast future outcomes. A thorough comprehension of the consequences will only come from examining the specific details of the agreements.

A Tale of Two Governments

The current trade landscape highlights a potential divergence in priorities. The UK government in Westminster has pursued these deals as part of a broader "Global Britain" strategy, aiming for wide-ranging economic benefits across many sectors. However, this national strategy often clashes with the specific interests of devolved administrations and key regional industries, such as Scotland's agricultural sector. The Scottish government and farming bodies have repeatedly called for their unique circumstances to be given greater weight in negotiations, arguing that a one-size-fits-all approach to trade risks sacrificing vital local industries.

The Question of Food Security

The debate over trade deals is increasingly being framed within the context of national food security. A recent analysis highlighted that post-Brexit trade agreements risk creating a "two-tier" food system, where high-quality UK produce is exported while cheaper, lower-standard foods are imported for domestic consumption. The UK currently produces only about 61% of the food it consumes. Critics argue that increasing reliance on long-distance supply chains makes the nation more vulnerable to global shocks, from geopolitical conflicts to climate events, raising questions about the resilience of the UK's food supply in an unstable world.

Counting the Carbon Cost

Beyond economics, the environmental impact of the UK's new trade strategy is also under scrutiny. Importing vast quantities of meat from Australia or South America carries a significantly higher carbon footprint compared to consuming food produced locally. This appears to contradict the UK's own legally binding net-zero emissions targets. Environmental groups and concerned consumers point out this policy incoherence, arguing that trade policy should align with, not undermine, climate goals. The "food miles" associated with these deals present a clear challenge to the vision of a sustainable and green future for the UK's food system.

The Choice at the Checkout

Ultimately, consumers at the supermarket will feel the repercussions of these commercial agreements. While the promise of cheaper food is often used to justify the arrangements, the reality may be more complex. Shoppers face questions about the origin, welfare standards, and environmental impact of the products on offer. Effective and transparent labelling will be crucial to allow consumers to make informed choices. However, there are fears that without robust regulation, the market could be flooded with products that, while cheaper, fall short of the high standards the British public has come to expect from its own farmers.

A Crossroads for Scottish Agriculture

Scotland's farmers are standing at a critical juncture. They are not resistant to change or afraid of competition, but they are adamant in their call for a level playing field. The core of their argument is that trade must be fair. All food sold inside the United Kingdom, regardless of origin, should comply with the identical rigorous standards of safety, animal welfare, and environmental protection that are legally required of them. The future of Scotland's cherished agricultural heritage now depends on whether the pursuit of global trade can be balanced with the preservation of its foundational domestic industries.