Cereals industry urged to get fit for the future as potential realities of Brexit emerge
AHDB’s annual Grain Market Outlook conference underlined the pervasive influence of Brexit on the future of the UK cereals and oilseeds industry.
Opening yesterday’s (11 October) conference, themed around getting ready for a post-Brexit marketplace, AHDB Cereals & Oilseeds chairman Paul Temple acknowledged the tough reality of the challenges faced by the industry.
But he expressed confidence the industry could ride the wave of change by resisting the temptation to wait and see, instead urging farmers to understand the potential challenges and adapt accordingly.
Mr Temple said: “We are in an exciting period of history. It’s really easy to feel lost and inclined to sit back and see what happens but Brexit success will be about facing and managing change and, most definitely, about being competitive.”
The event, held at the Grand Connaught Rooms in London, saw the launch of AHDB’s most recent Horizon analysis – Brexit scenarios: an impact assessment – which paints a challenging picture for UK cereals producers in a range of possible trade and policy scenarios, particularly if they fail to address productivity issues.
For cereals, the scenarios used by AHDB to model effects on Farm Business Income saw a fall of between nine and 103 per cent – putting businesses into a potential loss-making situation.
But the report also shows that farms the top 25 per cent of performers are best able to weather the effect of any of the scenarios.
AHDB Senior Analyst Sarah Baker, who co-authored the report, said: “There is a lot out of growers’ control but if they focus on the things they can control in their businesses, this should be a good strategy to get ready for Brexit and not only survive but thrive.”
After presenting the findings, Ms Baker was joined on a panel by Market Intelligence director Phil Bicknell, head of Strategic Insight David Swales and Barclays’ Mark Suthern.
Topics from the floor delved into the detail of the results, as well as the various factors affecting on-farm profitability and began to look at some of the solutions presented to the industry at Cereals in June.
These, detailed in Post-Brexit prospects for UK grains, include a whole chain approach to driving competitiveness, getting to grips with product niches and driving improvements in performance through benchmarking.
Closing the conference, AHDB Strategy director for Cereals & Oilseeds Dr Martin Grantley-Smith said: “The results of our analysis don’t make comfortable listening for cereals and oilseeds specialists. While it concentrates on the impact on farm businesses, it is relevant to all businesses in the supply chain as it affects the UK supply base.
“There are solutions, particularly within supply chains, to manage market volatility. But we are concerned the industry is slow to accept the change around Brexit and equally to grasp the opportunities it presents.”
Videos will be available on AHDB Cereal & Oilseeds’ YouTube channel in a couple of weeks. All AHDB’s Horizon reprots are available to download at www.ahdb.org.uk/brexit