Countdown
to 2011
Extracts from an article that first appeared in Money Media.
On January 1st 2011 Manx agriculture faces it’s own Island equivalent of the millennium bug. The red meat derogation will be, we’re told, lost for ever, and increasing numbers of column inches are predicting death and damnation for the industry.
But will the introduction of the free market come like a plague of locusts across Manx farms, or is this an opportunity, which if seized, could leave Manx farming, and Manx citizens better off as a result?
The red meat derogation, which has been in place since 1982, allows the Isle of Man to limit the amount of red meat it imports. (Prior to this the 1934 Marketing Act achieved a similar end). Under this agreement with the European Union, of which the Isle of Man is an Associate Member, the Island is allowed to limit meat imports to just 20%. That means 80% of the red meat available on the Island is home produced. This derogation has been a major driver in the farming industry and the majority of Manx agriculture is focused on either rearing animals, or growing food to feed to animals.
Production costs are higher on the Island than in the UK, therefore the derogation has been essential to maintaining a market advantage for Manx farmers who would otherwise find it very hard to compete on price.
Is the loss of derogation therefore good or bad?
The bad side
What really counts is the way in which we all, as an Island community, respond to the challenge. There are those in the industry who fervently believe that the derogation will be extended. My own (personal) belief is that with current and historical free trade trends both in Europe and the World Trade Organisation it is astonishing that we have retained the derogation for so long. These days trade distorting barriers to the free market are anathema to governments, and other decision makers.
But while some in agriculture hold fast to the hope that January 1st 2011 may never come, the rest of us must prepare and adapt in order to survive. We must adapt our product by listening to customers and responding to their demands; we must adapt our thinking so that we reach out to the community to win their support; we must adapt our industry so that it meets the needs of both farmers and the consumer; and we must develop legislation to free up farm businesses to ensure they can thrive in a free market environment.
Loss of derogation is driving change with a big stick, but with careful planning and open strategy making I believe we could turn the stick into a pole vault pole.
We have four and a half years.
If we prepare now; if farmers, entrepreneurs, shoppers, and government invest in a modern customer driven agriculture, then perhaps, as with the millennium bug, when January 1st 2011 comes we’ll never really know whether we needed to change or not.
Instead we’ll just thank our lucky stars that our farming industry is still alive.
ENDExtracts from an article that first appeared in Money Media.
On January 1st 2011 Manx agriculture faces it’s own Island equivalent of the millennium bug. The red meat derogation will be, we’re told, lost for ever, and increasing numbers of column inches are predicting death and damnation for the industry.
But will the introduction of the free market come like a plague of locusts across Manx farms, or is this an opportunity, which if seized, could leave Manx farming, and Manx citizens better off as a result?
The red meat derogation, which has been in place since 1982, allows the Isle of Man to limit the amount of red meat it imports. (Prior to this the 1934 Marketing Act achieved a similar end). Under this agreement with the European Union, of which the Isle of Man is an Associate Member, the Island is allowed to limit meat imports to just 20%. That means 80% of the red meat available on the Island is home produced. This derogation has been a major driver in the farming industry and the majority of Manx agriculture is focused on either rearing animals, or growing food to feed to animals.
Production costs are higher on the Island than in the UK, therefore the derogation has been essential to maintaining a market advantage for Manx farmers who would otherwise find it very hard to compete on price.
Is the loss of derogation therefore good or bad?
The bad side
- Loss of derogation could mean the Island is flooded with cheaper meat products. This would mean that Manx farmers, who could not compete on price, could be run out of business
- If Manx farmers went out of business our managed landscape would change because 80% of the Island is maintained by farmers
- Without managed landscapes many of our precious wildlife habitats may disappear
- Without farming the potential cost to government of managing the landscape for local people and tourists could be astronomical
- Loss of derogation gives Manx farmers the opportunity to recreate a more diverse agricultural industry, based around a larger variety of market needs
- There is an opportunity for entrepreneurs to open businesses celebrating quality Manx produce and uniquely processed foods – from chutney and honey to branded bangers and healthy fast food
- It gives us a nudge to develop the quality Manx brand in the export market to earn higher returns for what we sell abroad
- There is also the chance to create sustainable farming businesses that are ultimately less dependent on government support
What really counts is the way in which we all, as an Island community, respond to the challenge. There are those in the industry who fervently believe that the derogation will be extended. My own (personal) belief is that with current and historical free trade trends both in Europe and the World Trade Organisation it is astonishing that we have retained the derogation for so long. These days trade distorting barriers to the free market are anathema to governments, and other decision makers.
But while some in agriculture hold fast to the hope that January 1st 2011 may never come, the rest of us must prepare and adapt in order to survive. We must adapt our product by listening to customers and responding to their demands; we must adapt our thinking so that we reach out to the community to win their support; we must adapt our industry so that it meets the needs of both farmers and the consumer; and we must develop legislation to free up farm businesses to ensure they can thrive in a free market environment.
Loss of derogation is driving change with a big stick, but with careful planning and open strategy making I believe we could turn the stick into a pole vault pole.
We have four and a half years.
If we prepare now; if farmers, entrepreneurs, shoppers, and government invest in a modern customer driven agriculture, then perhaps, as with the millennium bug, when January 1st 2011 comes we’ll never really know whether we needed to change or not.
Instead we’ll just thank our lucky stars that our farming industry is still alive.
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