Fallout over foot and mouth in Europe

by Emily Wilson
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The foot and mouth epidemic in Britain has been another cruel blow for an industry just beginning to recover from the 10-year battle against the cattle brain disease BSE. As World Grain went to press at the end of April, over 2.2 million cattle, sheep, pigs and goats had been slaughtered under the British government's strategy to control FMD since the outbreak began in the third week in February in a herd of swill-fed pigs.

The epidemic has had a dramatic effect far beyond those farmers directly affected by the disease. The tourist trade — an important source of income for many small farms and rural businesses — has slumped, several major international sporting events have been cancelled and a large number of agricultural shows and events have been postponed or cancelled.

By the end of April, the epidemic was showing signs of coming to an end. The number of new outbreaks had fallen to around 10 per day compared with a peak of 47 per day at the end of March, and restrictions on movement of livestock and transport in the countryside were beginning to ease. Shocking as the slaughter of an estimated 2.5 million animals by the end of the outbreak has been, they represent a very small percentage of the U.K.'s 44 million sheep, 12 million cattle and eight million pigs.

But while the livestock industry is starting to see an end to its nightmare, the grain and feed industry in Northern Europe is facing serious problems of its own. Not only has it been affected by the disruption to trade, almost continuous rain since last autumn means it is also facing one of the lowest harvests for many years. Drastic cuts in sales of fertilizers, seeds, chemicals and equipment, plus a decline in the volume of grain traded is expected to squeeze even more companies out of business.

The immediate effect on grain trade after the foot and mouth epidemic began was to disrupt export trade. Denmark, Hungary and several North African countries announced bans on grain shipments from all countries affected by the disease, which at that time, apart from the U.K., included the Netherlands and France, where isolated outbreaks had occurred. However, the bans were lifted within a few weeks following swift action by the European Commission's Standing Veterinary Committee after consultations with the U.K.'s Grain and Feed Trade Association (on whose contracts most international trade is based), the United Kingdom Agricultural Supply Trade Association and the Home Grown Cereals Authority.

The U.K. organizations pointed out that grain was harvested and in store long before the foot-and-mouth outbreak began while 90% of the infected areas were many miles away from the main grain producing regions. At the same time, strict new codes of practice recently brought into operation under new food safety initiatives (World Grain, March 2001, page 26) meant there was no risk of contamination during transport and handling. The E.U. Veterinary Committee said the risk of contamination from grain shipments was negligible.

A much bigger problem for the U.K. grain trade proved to be general transport movements in affected areas. Despite strict precautions some farmers were still reluctant to allow any outside transport on their land, which made it difficult in some areas to collect grain already contracted for. The general uncertainty in home and export markets resulted in a substantial drop in the level of grain trading for some weeks while extra paperwork added to the problems of the trade.

One bright spot was the increased demand for manufactured feeds. By far the largest number of animals affected by the disease were sheep that eat very little compound feed. Fears of infection and bad weather kept cattle inside far longer than usual, increasing consumption of compound feeds, while pigs, the other big consumers of manufactured feeds, luckily had very few outbreaks.

At the same time, the number of animals going for slaughter for moving into the food chain fell dramatically because of movement restrictions. For the first two months of the epidemic, the total number of animals slaughtered, including those going into the food chain and those for disposal under the foot-and-mouth cull, was running well below the average under normal conditions — all of which led to increased feed sales.

Welcome as this boost has been, however, the animal feed, milling and baking industries all face a number of problems in the future as a result of foot-and-mouth disease and tight grain supplies. With swill-feeding in pigs pinpointed as the likely source of Britain's devastating foot-and-mouth outbreak, there has been an international call for its ban worldwide. But this could have a serious effect on grain-based industries.

In Britain, the Ministry of Agriculture, Fisheries and Food has put forward proposals that would ban not only the use of waste food from schools, restaurants and canteens but of all food industry by-products, including brewers' grains, confectionery waste (mainly biscuit meals), sugar beet pulp, bread and unsold vegetables. This would not only create further waste disposal problems but also cut out a source of safe and nutritious feed ingredients. Grain processors also would lose outlets for their manufacturing by-products.

While the foot-and-mouth outbreak has caused many problems, the grain trade is now even more concerned about prospects for this year's harvest in the E.U. Continuous rain since last autumn has left many fields across Northern Europe hopelessly waterlogged. Worst affected areas are in northern France and many parts of the U.K., which has suffered the wettest 12-month period since records began in 1766.

Winter wheat plantings in the U.K. are estimated to be down by as much as 30%. In many areas it was expected to be too wet for spring sown crops. Industry forecasts expect the U.K. wheat crop to slump to around 12 million tonnes (compared with 15 million in a normal year) while the more pessimistic believe it could be as low as 10 million.

There are expected to be similar falls in northern France. In its mid-March forecasts, COCERAL, the European Grain and Feedstuffs Committee, said it expected the E.U.'s wheat harvest in 2001 to be down by 7%, with total grain production down by 3%, but said these forecasts were expected to be cut further in mid-May.