Supply chain may lose 775m

By FWi staff

EARLY NFU estimates of the financial impact of foot-and-mouth disease show that the whole supply chain could lose up to 775 million over the next three months.

About a third of that, 288m, would be due to direct losses in the agricultural sector, and the rest from the remainder of the supply chain, says Siôn Roberts, chief economist at the NFU.

“However, these are very approximate figures, and include a huge number of assumptions. They are an initial stab to help people realise what might be involved.”

Export losses for lamb, pigs and dairy products are put at 152m over three months.

But much may end up on domestic markets, since it could take 40 days to reopen EU routes after the UK becomes foot-and-mouth free, and six months for non-EU destinations.

This could weigh heavily on domestic prices, says Mr Roberts.

Stock could also lose 13m-worth of quality, and 5m-worth of cattle could enter the over-30-month scheme in the next three months.

Slaughter costs associated with foot-and-mouth are put at 91m, though farmers will be compensated. Additional feed costs could amount to 26m over the same period.

Non-agricultural losses, including bed-and-breakfast and farm shops, could hit 93m, or three-quarters of usual income.

Costs through the rest of the supply chain are put at 488m.