Simmers debt trap
Simmers debt trap
CREDITORS of collapsed Scottish pig giant Arthur Simmers have been warned that they may not get all their money back.
"Land values and the general state of agriculture are not as good as they have been, which may raise some question marks," says David Turner, of receivers Price-WaterhouseCoopers.
Valuers have spent this week totting up the Aberdeenshire outfits assets. But it is not yet known whether these will cover debts of about £10m, says Mr Turner.
Creditors – among them Lloyds TSB, feed firms and farmers – can do nothing but wait and see. One said that expecting to see all their money again was "unrealistic".
The business extended to 16,000 sows, 120,000 progeny, 350 dairy cows, and grass and arable farms of 4000 acres. Selling it as a going concern is unlikely, say the receivers, although the number of enquiries for part-purchases has been "encouraging".
Scottish NFU has called a meeting in Aberdeen to assess the effect of the collapse.
"Arthur Simmers ran one of the biggest rural businesses in Aberdeenshire and the effects of its closure will be felt throughout the industry," said Scottish NFU president George Lyon.
"We have repeatedly told the government that the effects of a farm failure are felt throughout the community and this case will surely demonstrate just how much upstream and downstream activity is dependent on agriculture."
While the supply of pigs on to the market will rise in the short-term, long-term production is likely to fall, with the Simmers operation accounting for about one-quarter of the Scottish breeding herd, says Pam Marr of the Scottish Agricultural College. "But there is still chronic oversupply through Europe."
Arable farmers could also suffer. The businesses used 50,000t of grain a year – nearly half of which was bought-in. Scottish NFU cereal convenor Peter Loggie now fears a "big hole" in the feed market.
"If the grain has to be shifted somewhere else, there will be an additional transport cost if nothing else. Farmers will lose one way or the other – they always end up paying." *