Sevington gives cause for concern

Importers face unpredictable bills from HMRC

There are no redeeming features of the purpose-built customs inspection facility close to the Eurotunnel terminal. Sevington will be remembered for its brutally sparse amenities, more an abandoned building site rather than a conduit of international trade. Even though the British taxpayer poured at least 120 million pounds into the place, there is no way that any of it went into amenities for lorry drivers, such as a food outlet for those kept on site for a day or more. An Italian driver was given directions for a MacDonalds takeaway more than a mile away, when he asked about catering arrangements during a 55-hour wait. Water is available for lorry drivers, but neither tea nor the continental working beverage of choice, coffee, is anywhere to be seen. 

The purpose of the visit is food inspection, but Sevingdon has a growing catalogue of problems.  There are no guarantees that having waited four hours or more to have goods inspected the goods will still be saleable at the end of the process. There is no way that HMRC will take any form of liability for breakages and rough handling of fragile goods, particularly plants. Retailers are refusing damaged consignments, in one case estimated at EUR 40,000 (GBP 37,700). 

Over the past six weeks since the second phase of BTOM, 2,500 Dutch lorries have travelled to the UK, with 125 being “turned out” in HMRC slang. The Dutch haulage industry body Transport en Logistiek Nederland (TLN), remains supportive of Britain’s BTOM plan, with a polite but firm report outlining the Dutch hauliers’ reservations  with the status quo, making tactful suggestions for improvements. At this point it should be made clear that while most people would assume that the Border Transfer Operating Model is an administrative framework to manage the flow of goods efficiently. There is a more sinister, or cynical view that runs through the British establishment from its very origin. Had the government spent £120 million or more on a state of the art logistical platform, eyebrows might have been raised. But spending on that scale to create an environment that brutalises all those who come into contact with it and pitilessly crushes any possible interest in wanting to move to Britain was fine. Publishing under his pen name George Orwell, journalist Eric Blair captured this elusive maverick mindset writing under the setting sun of a crumbling empire. Orwell’s accounts of such incidents as the shooting of a working elephant juxtaposes the credentials of the imperialist administrators and the lives of those they exploited. Only we wouldn’t say exploited if we could get out of it: Orwell saw to it that we can’t.

What today’s generation of administrators is doing would make sense to a commentator like Orwell. He would understand the previous government’s obsession with small boats: the symbolism of inbound asylum seekers; the fear and loathing of exotic languages; the lingering smell of spices that grow in crowded corners which are ill-suited to mechanised agriculture. These are the roots of racism and prejudice, tinged with guilt for the massacres that were carried out in the name of civilisation. We must first slay the ghosts of oppression that our ancestors pretended to ignore, hardening their hearts and blocking their ears the while.

It is against this backdrop that we need to look at the operational shortcomings of BTOM. Start with the inspection processes and the sketchy way they operate. EU sampling rates, for instance, would normally start at 100% for new third country businesses (Brexit assumes tabla rasa.) easing off  over a period of time to, say, 35% after a year so of solid compliance. Sevington is sampling 5% at most, and struggling with it. There is no way a long term target of 100% could be achieved, nor would it serve any useful purpose once compliance levels have been established. TNL is concerned by wide variations in prices for testing at privately-owned facilities, citing fees ranging from £300 to £750, with additional surcharges for weekends and bank holidays. This leads to uncertainty for costings, resulting in financial losses and operational constraints. What is more, any non-food consignments that are travelling on the same trailer as food products selected for testing face an average surcharge of £13. Go figure.There are also issues with the flow and quality of information coming back from BCP. The Dutch hauliers urged the British authorities to communicate in real time, since saving messages sent as an overnight email is not a lot of help in the real world. Likewise, linking the Common Health Entry Document for Plants and Plant Products (CHED-PP) with the Goods Movement Reference number (GMR) would make it easier to identify consignments that will undergo  testing later on. As for handling standards, TNL was scathing. Not least because HMRC does not take any liability for damage caused during product checks. The Dutch hauliers would like to see staff trained to a higher standard and suggest that drivers would be well-qualified to advise on reloading fragile plants after inspection. While on the subject of drivers, none of them took on the job to spend hours in a sensory deprivation decor, often for hours on end. They are routinely barred from leaving the site or are required to surrender the keys to their vehicles as a condition of going outside for a breath of fresh air. TNL is receiving calls from members who have lost money due to rough handling of fragile goods. There have also been cases of inspectors not turning up or being taken off one inspection to attend another. The lack of any form of product liability on the HMRC inspectors is a recurring theme, but the tone of the TNL assessment is constructive and polite, as the industry body offers to help to resolve some of the issues the HMRC faces. It has published a four-page report on the subject. Expect the temperature to rise in July, when the first batch of invoices go out for Common User Charge payments from April 30 onwards. There are suggestions that it will be tricky to match up consignments, locations and testing in a coherent narrative adding up to some serious money. Watch this space.

Dover puts food safety first

 Dover port health staff carrying out food safety checks are being sidelined by DEFRA, which is telling importers that their goods should be routed through Sevington. Before shipping certain goods, importers must pre-register the shipment using a system called IPAFFS which is short for Import of Products, Animals, Food and Feed System. DEFRA is telling everyone to delete the Dover port code from the documentation and  to change their IPAFFS point of entry to  Sevington.

Staff at Dover have been carrying out SPS food safety checks for a decade, but they have never found themselves at loggerheads with DEFRA before. The root of the problem is the Border Operating Model (BTOM), which is not set up to manage product assessments requiring detailed knowledge and experience. 

Assigning three levels of risk to food imports does not cover real life situations. Take High Risk Food Not Of Animal Origin HRFNAO, which is a detailed listing of food products that need to be checked for specific  hazards. These can include central European blueberries, which are checked for radioactive Caesium 137 from Chernobyl; peanut products from north and south America, which are checked for aflatoxins; or US fishery products, for which processing hygiene standards vary widely.

There is a statutory compliance angle to these product checks, which are regulated by assimilated European laws. At this point they are beyond the remit of BTOM and DEFRA is not authorised to change their enforcement. So instead, the ministry has been advising importers to amend the IPAFFS entry from Dover to Sevington.

In the meantime, Dover port health staff continue to carry out the food safety checks that keep the nation’s food safe.

Week 23 datacrumbs

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A world first: on-farm biogas liquefaction was demonstrated by Sublime Energie in the comfort of the sixth arrondissement of Paris this week. It may be good enough to put in a bottle, but, like the genie, you wouldn’t want it to get out…

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After a year and a half of reflection and planning, the US FDA (Food and Drug Administration) has announced that it will implement a new operational structure on October 10. Details here.

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With no more than a month to go before the election, War on Want is writing to party leaders to remind them of the sort of changes that ordinary people want to see. Find out more here.

Week 24 datacrumbs

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Global warming is primarily the result of damaging policies and economic choices made by rich countries, while the impact is felt most acutely by poor countries and economies in the south. Tuesday June 11 is a Global Day of Action for Climate Finance, during which campaigners around the world seek justice for the victims of this imbalance. In the UK, War on Want is supporting a march from Trafalgar Square to Downing Street at 12 noon. Marchers will deliver a demand for positive action by prime minister Rishi Sunak at a summit of G7 member states in Turin next week. Link to the campaign here.

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LEAF (Linking Environment and Farming) is celebrating 30 years of sustainable farming on the weekend of June 26/27 with the return of the Groundswell festival event. More details here

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AHDB UK clean pig slaughter numbers for week 24 recorded a week on week rise to 11,000 head, bringing year to date slaughterings up to 151,000 head as of June 1 this year. (estimated figures) The year to date figure is up by 1,000 during this time, while carcase weights have hardly moved over the past week at 90.58kg with just over 11mm back fat. AHDB pig market data is here.

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Oil giants BP and Exxon are sufficiently frightened by grassroots campaigners to be planning to send 200 lobbyists to Canada this November in an attempt to delay a major international treaty that will reduce plastic packaging waste. International campaigns group Eko has a cunning plan to thwart their plans. More information here.

Dover’s double whammy

The UK has depended on imported foods and ingredients for centuries. The market mechanisms which make this possible are under attack – from the British government. 

At the end of April, it started charging a levy on certain food imports. Called the Common User Charge (CUC), it is currently applied to a number of plant and animal products which are subject to Sanitary and Phytosanitary (SPS) checks. The supposed aim of the levy is to pay for wear and tear to the UK’s port facilities arising from HGV traffic. It is not being collected to pay off capital expenditure. Whether intentionally or not, the Common User Charge could destroy key sectors of the British economy. 

Projections of its likely cost to importers have risen steadily as civil servants have got a better understanding of how consignments are documented. The Common User Charge was first calculated as a one-off levy, taking the top five consignment lines from a single Common Health Entry Document (CHED). There can be more than one CHED for a consignment: they list commodity codes and the risk status of the goods in the consignment. Low risk products and goods in transit (to Ireland) are charged at £10 per consignment line, which rises to £29 for medium and high risk products.

When it became clear that a consignment can have more than one CHED those drafting the rules worked out that they were missing a trick. From an initial assurance that a common user charge would be capped at £145 and based on a single CHED, they became complex calculations across multiple CHEDs, totalling several hundreds to a thousand or two thousand pounds.

Importers of food to the UK using Dover could end up paying twice. Until recently, food safety testing was routinely carried out on products arriving in Dover. Now, drivers with consignments of animal or plant products that require SPS testing will be instructed to take their lorries to an Inland Border Facility at Sevington, 22 miles away, where a further Common User Charge will be due. The site also serves the nearby Eurotunnel terminal at Ashford.

Compare this to a basic ferry ticket for a lorry, like the DFDS cross-channel Spot ticket, which sells online for less than £300, of which six pounds go to the ports at either end of the trip, covering wear and tear on the roadways as well as port maintenance. The Common User Charge is 48 times more than the modest sum charged by a commercial shipping line. Dover port is owned by the town, thanks to a royal warrant issued by James I in 1604, meaning that the state has no stake in the country’s largest port. Not that this has stopped it from milking Dover like a cash cow. For a number of reasons, Sevington has been pushed for SPS testing by the Department for Transport, which has been responsible for the site since it opened.

When the question of double charging was raised, the response was unequivocal. “You will be charged the CUC regardless of whether the lorry is called for inspection or not, along with the Ashford Port Health Authority relevant charges,” (sic) a spokesperson for Dover port declared. The idea that treating the world with contempt might be inappropriate seemed to be irrelevant. Not sure that the two halves of the answer were in response to the same question, either.

Urban Food Chains understands that importers are unable to access any billing or account information relating to the first Common User Charge bills. On April 16 and 25, HMRC updated its guidance, explaining that the first CUC invoices would not be sent until 12 weeks after April 30, the date the CUC came into effect. After July 30, invoices will be monthly in arrears. There are no plans to include any consignment detail that would help businesses to identify the shipments.

The new system risks creating a hostile environment (see this post) for hauliers and importers alike. This would reduce both the availability of goods and drivers to move them, as well as pushing up prices.

Week 21 datacrumbs

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Commodities news service ZMP is running an item from Morocco, where a 43% drop in harvest has been preceded by a 33% decline in planted area.

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After three years of low stocks and poor crops, Brazil’s orange juice industry is starting to look around for alternative citrus fruits that do not succumb to citrus greening. This condition first appeared in Florida 20 years ago, wrecking the state’s headline crop. Today, Brazilian producers face a devastating combination of bad weather …and citrus greening. There is a big article in the Financial Times that brings readers up to date with an ongoing crisis.

Not for the faint-hearted

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Back in 2019, the British government estimated the probable cost of Brexit to British business would be around £7.5 billion. If this figure has since been revised, it has not been released. During 2023, the UK handled a total of 39 million customs declarations.

Between January 2021 and December 2023, food importers paid £54 million pounds for food safety checks (SPS) on inbound consignments. Over the coming months, traders are expected to pay a further £469 million to set up SPS and Safety and Security (SSD) systems.

These are some of the figures published today by the National Audit Office (NAO) along with its findings on the government’s management of the Brexit process so far. It is still too early to talk of Brexit as if it was a completed process. Download the NAO’s findings here, or watch this space for further posts…

Huffin’ and puffin

Fish for lunch…

From the soaring concrete cliffs of Brussels there is an impending explosion of anger. The reason? Look at Charles Sharp’s impressive picture of a puffin, just about to enter the home burrow with a beak full of sand eels. It is the fish, not the bird,  that is fanning the flames, by the way.

For all its comical looks, the puffin is an important indicator in the monitoring of the marine environment around the British Isles. Researchers are particularly interested in the fish stocks that support this distinctive seabird. The  term sand eel is a generic label for a group of about 200 fish species that resemble eels but are not related. They burrow into sandy seabeds and hide from predators while keeping an eye out for their own lunch. Hard to catch in open water, they are easy to scoop up in a dredge, as Danish fishermen have done for centuries.

Puffins are far from being the only bird species to be tracked by scientists. It just happens to be the cutest one of the bunch. The puffins’ lunch, by the way,  is at constant risk of damage from bottom trawling, that is to say beam trawls or dredgers and other devices. Scallops is one species to be caught in dredgers, while cod is a target species for many beam trawls.

Back in January this year, the UK government announced a ban on dredging for sand eels in UK-controlled Marine Protected Areas (MPAs). For the record, bottom trawling is allowed across 98% of the MPAs concerned, suggesting that the state of the seabed has not been a political priority for years. In the North Sea, with its sandy sea floors, there are still  beam trawlers fishing demersal species and small number of Danish dredgers who, between them, hold about 90% of the 160,000 tonne sand eel fishing quota. (UK and EU total) 

The origins of the Danish sand eel fishery go back to the soaring livestock holdings of the late nineteenth century, which set the Danes looking for cheap ways of feeding animals. Initially, small dredges were fitted to inshore boats, scaling up in the early twentieth century to purpose-built diesel powered vessels with an ever greater range. For some reason, as with a number of other fisheries, nobody imagined that the fish stocks would ever decline: until, that is, the catches started to drop. With growing numbers of animals on livestock holdings, the potential earnings from sand eels rose, as did the pressure on the fish stocks. Sand eels, along with other oily fish and suitable bycatch, are the ingredients of fishmeal, an industrial end product turned out in large quantities by refineries that earned a living clearing up after the high value fish processors in fishing ports. 

In the early days of indoor livestock, fishmeal was added at two thirds to one third cereals. As researchers extended their knowledge of livestock nutrition,  the proportion of fishmeal was reduced, making animal feed more profitable or cheaper, depending on your involvement in the process. To ensure an illusion of sustainability for food production in the late twentieth century, the European Commission devised the Common Fisheries Policy, which used its budget to subsidise a rise in the European fishing industry’s tonnage and horsepower, ensuring an ever more unstable fishing industry. 

Fast forward to 2024, and the European Commission is threatening to trigger a dispute procedure under the EU-UK Trade and Co-operation Agreement (TCA). The Commission is acting on behalf of Danish sand eel fishers with fishing vessels to maintain. If agreement is not reached by mid-June, the Commission  can request a judgement on the UK’s  action. While any hearings may be carried over into September, the European Commission is calling for an “evidence-based, proportionate and non-discriminatory” approach to protecting marine environments.  

“The UK’s permanent closure of the sand eel fishery deprives EU vessels from fishing opportunities, but also impinges on basic commitments under the EU-UK Trade and Cooperation Agreement,” warned commissioner  Virginijus Sinkevičius. “Measures are already in place to protect this important species, including by setting catches below the scientific advised levels and closed areas for protecting seabirds,” he added. London responded, saying that DEFRA had not authorised any sand eel quota for British vessels for the past three years. Marine protection NGOs across Europe have launched a campaign to end bottom trawling, which is still allowed in 90% of the EU’s marine protected areas (MPAs). Last year Europe agreed to an EU Marine Action Plan that phases out bottom trawling by 2030. This has some way yet to go.

According to the European Market Observatory for Fisheries and Aquaculture Products (EUMOFA) the EU produces between 10% to 15% of the world’s fishmeal and fish oil output. Tonnages of EU fishmeal range from 370,000 tonnes and 520,000 tonnes, while fish oil ranges between 120,000 and 190,000 tonnes. Denmark accounts for nearly half the EU’s total output. In addition to sand eels, EU processors use small pelagics, such as sprats, whiting or herring, all regulated with quotas and topped up with trimmings from fish processors. EU demand for fishmeal has dropped in recent years and is currently hovering around 450,000 tonnes/year. 

Every one of them is different

Sky News is currently streaming an overview of British farming (https://news.sky.com/story/it-keeps-me-awake-at-night-can-british-farming-survive-13132220) which raises a number of questions that have been dodged for years and are coming home to roost with a certain inevitability. They are as predictable as ever, as intractable as ever and demand answers as urgently as ever. The only certainty is that the farming sector faces a crisis which has been ignored for years and will no longer wait in an orderly queue.

The first thing that needs to be made clear at the outset is that there is no such creature as an average farmer. The Sky presentation is very careful to choose visually tame representatives of a sector that  is universally misunderstood. Sky’s lead journalist on this reporting, the west of England and Wales correspondent Dan Whitehead, would doubtless agree that despite the rapidly falling numbers of farmers in Britain, there is no such creature as an “average” farmer anywhere in the world.

The industrial world develops and markets a range of specialist vehicles and technology for a sector that has as many solutions for its many technical challenges as it has practitioners. The general public, in Britain and further afield, has no problem synthesising a stereotype notion of a nonexistent rural world. In the process, any suggestion of  a viable business model  runs counter current to the town dweller’s vision of a rural idyll.

It would not be productive to imagine that rural businesses are complementary to industrial or urban economic structures. Nor can the transport and distribution networks that link urban consumers to an imagined rural hinterland ever ensure that each business gets what it needs in a timely manner.

A frequent town dweller’s  notion of a farm is more like a zoo than a production unit. Go back a century or so to George Orwell’s Animal Farm and you encounter a group of anthropocentric livestock: hens, pigs, cattle and heavy horses. Truth to tell, if it ever existed, this diverse community of livestock was a casualty of the first world war. The two million British equine casualties had a greater impact on warfare and industry than the loss of several millions of military personnel or civilians killed in air raids elsewhere. British army officers were required to supply a horse’s  front hoof when reporting an equine casualty, whereas they did not need to furnish any such grisly evidence for human casualties among their ranks.

The wartime massacre of draft horses was beyond the breeding capacity of the northern hemisphere and cleared the way for mechanisation in both rural hinterlands and metropolitan centres alike. The British army bought in horses from as far away as North America, but they were ill-suited to military requirements.

Both agriculture and industry have exhibited huge appetites for energy during the past two centuries. The combined effects of converting the plains of North America into a grain exporter on a continental scale. This was accompanied by the relentless westward advance of the railroads through the 1850s and 1860s, hauling wheat back to the east coast and shipping it on to Europe. 

The age of steam put bread on the tables of starving cities. It may even have given urban populations a passing curiosity as to where food comes from and what sort of people might produce it. But the only people that ever had contact with producers and consumers were traders with a limited interest beyond crop forecasts and spot prices. It is hardly surprising that during the intervening decades, a parallel web of dreams fed on pictures in books and magazines should inhabit part of the cultural vacuum between town and country. 

Dan Whitehead’s rural narrative assembles facets of the  agricultural world as a kaleidoscope might do. He starts by talking to Welsh sheep producer Rhodri, who has seen a 40% cut in his income, now shorn of subsidy. He is worried that his school age son will not inherit the family farm.

Outdoor pork producer Jeff laments the supposed passing of the British pig industry. Like many British pig producers, he believes his European counterparts are subsidised as generously as they have ever been. He can’t go into a supermarket without spotting foreign meat: pork chops from Spain, chicken from Poland and Brazil. He can sum up Brexit in one word: “atrocious”. From his farm in Kent,  Jeff drove a tractor up London for a city centre protest. Like many in the pig sector, he is adamant that breeders have been thrown under a bus by a government that doesn’t care. “There’s an  unfairness in British agriculture,” he argues. Looking at the deals the UK government signed with Australia and  New Zealand, he might have a point.

Nearby, fruit grower Tim has built up a strawberry business valued in tens of millions of pounds. He needs a workforce of 2000 to pick thousands of tonnes of strawberries. Most of his recruits are from EU member states. When the UK was in the single market, workers could move  freely with no time limits. Now they are limited to six months and have to move on regardless of whether or not they are a net gain or a net drain on their employer. Tim is frustrated because he cannot negotiate prices for his crop from a solid position. 

There are plenty of British pig producers who will argue that foreign pigmeat is hindering domestic producers, but the story is a little bit more subtle than that. If British producers could earn a living off the sales of pork loins, they would cheerfully do so. Since loins are used for roasting joints or bacon, there will always be buyers for this cut. This often leads to a situation whereby British loin are sold through for roasting joints. Meeting demand for bacon packers, there is a steady trade in pigs from Dutch and Danish units. These have been raised to British standards for decades and are effectively competing on a level field, even if their British counterparts see it differently. The key to staying in business is referred to as balancing the carcase, ensuring that every saleable part of the carcase is sold. Hams or gammons are straightforward to prepare for the retail market and represent a good return. What British pig breeders often overlook, however, is that they will routinely export forequarters to cutting halls in northern Europe, which have skilled workforces that make short work of the technically challenging forequarters. These are home to the animal’s powerful jaw muscles. If a pig bites your hand, count your fingers as soon as you’ve stemmed the bleeding.