So what’s it got to do with farming?

On the 23 March 2021, the Ever Given, one of the largest container ships in the world, got stuck in the Suez Canal. It took six days to refloat it. This made the media everywhere. What wasn’t reported in quite as many newspapers was that the ship was then impounded by the Egyptian government on 13 April 2021. This is because the company refused to pay a reported $916 million in fees demanded by the government. This compensation is claimed to have included $300 million in “loss of reputation.” Personally I suspect that at that point the temptation of the owners would be to walk away, telling the Egyptians to just keep the boat. But apparently the Egyptians reduced their claim to $600. Finally, in early July 2021 the ship was allowed to sale, an agreement having been reached.

Obviously it caused chaos, there was a traffic jam of over two hundred vessels, and some boats decided to come home the long way, taking the 15,000 mile detour round the Cape, rather than wait until the canal was unblocked. Apparently “Suez to Amsterdam at 12 knots is just over 13 days via the canal, or 41 days via the Cape.” Not only have you the costs of the extra time, you’ve got extra fuel, and also the worry about how your customers will react to the fact that the stuff you’ve promised to deliver is still at sea.

But there was an interesting article in the paper this morning. The Ever Given has docked in Felixstowe, about four months late. Initially it had 18,300 containers on it, many were offloaded in Rotterdam, but two thousand will be unloaded in Felixstowe. The cargo includes two giant dinosaurs for a Cambridgeshire golf centre, and an awful lot of fruit and vegetables that have gone rotten.  

One problem is that shipping is cyclical, there’s a shortage. So people build more ships and scrap fewer, and then suddenly, ten or so years later, there’s a surplus.

And at the moment, we’re in shortage. There’s a demand for scrap, so you can cash your ship in for $500 a ton (a high price when banks were recommending people budget of $50.) Covid played a part, replacement crews were in the wrong place. Companies had to charter planes to fly them out and fly the others back, but the replacement crew might still have to quarantine for a fortnight. Schedules weren’t as much pushed back as scrapped.

But spot container rates for goods leaving Asia (which is the big exporter) rarely ran more than $2000 for a standard 40ft container. This jumped during the course of this year to $7000 and last week prices for the China to USA route broke the $20,000 barrier. Some of this is prices getting back to where they should be. At the start of 2020 it was notoriously cheaper in some places to stick the cargo on a freighter and send it round the world than it was to pay for warehousing.

So what does it mean for farming? Well we’re lucky in that most of the stuff we purchase, feedstuffs and fertiliser, come into the UK as bulk cargos. These haven’t seen the same cost hike as containers. But there again, some major shipping lines are now convincing their clients to abandon containers and just to ship things in bulk for the saving. So we’ll probably see prices rise. But for once there are advantages to being part of the obsolete and unfashionable end of the market.

But then there’s our competitors. It’s highly likely that some of the gaps in supermarket shelves are due to produce rotting on ships that were delayed, one way or another. Also a forty foot container can carry about 22 tons of fruit. The increase in cost from $2000 to $7000 would mean an increase of $250 per ton or about 18p per kilo. I cannot see the supermarkets deciding to just absorb that cost.

The exporters who’ll suffer most are those who sell cheap, bulk, commodities, such as food. A lot of African exporters are being badly hit, first by the lack of flights that would provide hold space for some cargo, but also by the fact that pretty much any cargo you want to ship is probably worth more per ton than food means that they’re going to be at the back of the queue when it comes to hiring shipping.

It’s going to be interesting to see what does either disappear from the shops and shoots up in price.

♥♥♥♥

There again what do I know? Speak to the experts

Available from Amazon in paperback or on kindle

 

and from everybody else as an ebook at

https://books2read.com/u/mggzxz

As one reviewer commented, “

This is a delightful collection of gentle rants and witty reminiscences about life in a quiet corner of South Cumbria. Lots of sheep, cattle and collie dogs, but also wisdom, poetic insight, and humour. It was James Herriot who told us that ‘It Shouldn’t Happen to a Vet’ but Jim Webster beautifully demonstrates that it usually happened to the farmer too, but far less money changed hands.

I, for one, am hoping that this short collection of blogs finds a wide and generous audience – not least because I’m sure there’s more where this came from. And at 99p you can’t go wrong”

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31 thoughts on “So what’s it got to do with farming?

  1. rootsandroutes2012 August 11, 2021 at 4:48 am Reply

    The local foodbank leadership aren’t going to be happy about that!

    • jwebster2 August 11, 2021 at 5:39 am Reply

      It’s going to be above our pay grade. Remembering the fact that over the next few years people are going to have to spend a higher proportion of their income heating their homes as gas dies and then the cost of travel going up through electric cars, if the population at large goes from spending 10% of their income on food to spending 15% of their income on food, an awful lot of things are going to be unaffordable and the industries supplying them could just fail

  2. Eddy Winko August 11, 2021 at 5:01 am Reply

    ‘Buy Local’ is going to do a roaring trade, not to mention UK based dinosaur model manufacturers.

    • jwebster2 August 11, 2021 at 5:39 am Reply

      It is going to be interesting to watch and see what happens

  3. Books & Bonsai August 11, 2021 at 7:37 am Reply

    There is a lot to be said for growing our own food…

    • jwebster2 August 11, 2021 at 8:29 am Reply

      There is indeed, but people are going to have to forget about it being ‘cheap’

      • Books & Bonsai August 11, 2021 at 6:11 pm

        This I have never understood. How can it be dearer to grow our own food, than shipping it in from half way around the world? It’s crazy!

      • jwebster2 August 14, 2021 at 5:41 pm

        It’s simple. If you have to have your food picked by somebody in the UK who wants a living way, as opposed to somebody in the third world whose children will pick for a dollar a day, it’s cheaper

        In some cases you’ll also save on energy growing somethings, or land could be cheaper because there isn’t the ridiculous demand for housing etc

      • Books & Bonsai August 14, 2021 at 5:55 pm

        There is still something wrong with this…

      • jwebster2 August 14, 2021 at 6:33 pm

        There is
        Priorities 😦

      • Books & Bonsai August 15, 2021 at 7:24 am

        But do they still matter, these days?

      • jwebster2 August 15, 2021 at 8:23 am

        Priorities always matter, but what they are changes. Now priorities are more ‘me me me’ and if some other poor sap has to work in a sweat shop for no money so people can have cheap shoes and clothes, they obviously don’t care about the workers in the sweat shops 😦

  4. Stevie Turner August 11, 2021 at 2:17 pm Reply

    We have quite a few farm shops around here to use if things get desperate. I’ve already noticed some empty shelves in the supermarket.

    • jwebster2 August 14, 2021 at 5:34 pm Reply

      There have been all sorts of little things over the last year, for example frozen stir fry vegetables disappeared from pretty much all the supermarkets at once and came back ‘reformulated’ which seemed to mean ‘more carrot’ 🙂

  5. Alicia Butcher Ehrhardt August 11, 2021 at 4:51 pm Reply

    The ship getting stuck in Suez isn’t even a Black Swan event – it was just something that could happen some day, with that many ships moving through the canal.

    We have strawberries EVERY DAY in California. The husband has been buying them because they are quite affordable, and gorgeous, and actually keep in the refrigerator (I put a paper towel in the bottom of the packages, and that keeps them from rotting due to excess moisture), and we’ve been doing this for almost three years.

    When I grew up in Mexico City, we bought strawberries – when they were in season – and that was it for the year.

    We can do without strawberries just fine – Europe got through harsh winters on stored cabbages, after all – but it’s made me hyperaware of the fact that every country on the planet wants to send us its best produce, and single source mono-crops are literally dangerous – to the senders and the spoiled buyers. Rotten buyers? Food metaphors creep in. ENTITLED buyers will work. And yet I have no more control over any of this than the growers: we buy what’s available.

    • jwebster2 August 14, 2021 at 5:39 pm Reply

      The thing is, what are seasonal vegetables in, for example, California and not seasonal vegetables in the North of England, Italy, Turkey or South Africa
      One big problem is cash cropping out of season vegetables in some third world countries by large companies and it pushes local people off the land and often into unemployment

      • Alicia Butcher Ehrhardt August 14, 2021 at 5:41 pm

        Or may provide jobs, but with a twist. For example, I remember hearing about flower farms in Mexico – and the employers somehow got away with employing only women to process the mature blooms – because they were assumed to be gentler. These jobs gave them economic freedom from the men.

      • jwebster2 August 14, 2021 at 5:43 pm

        And can be hired so much cheaper as well 😦

      • Alicia Butcher Ehrhardt August 14, 2021 at 7:26 pm

        Not necessarily. But better-paying jobs are scarce in these areas, and the men would jump on the flower jobs if they were allowed.

        Mind you, this was a while back, and I don’t have a source.

  6. Jack Eason August 14, 2021 at 7:21 am Reply

    Reblogged this on Have We Had Help? and commented:
    More from our farming correspondent…

  7. robertawrites235681907 August 14, 2021 at 8:06 am Reply

    Very interesting, Jim. We have been getting better quality fruit and veg here and I though it might be because less is being exported. I have finished this book and will write my review this weekend.

    • jwebster2 August 14, 2021 at 5:45 pm Reply

      You could well be right. The major retailers set high standards.
      I’ve seen produce described as McDonald’s Standard
      Hope you enjoyed the book.

      • rootsandroutes2012 August 15, 2021 at 1:43 pm

        McDonald’s Standard, Jim? Don’t make me laugh. Rita and I had our first McDonald’s meal in years last night, because – being in Carlisle – we were too far away to walk down to Roa Island Boat Club, What we were served was priced at well over half what we’d have paid at RIBC, and by any sane standards, it wasn’t worth a quarter.

      • jwebster2 August 15, 2021 at 2:30 pm

        You’re confusing environmental health standards with cooking and portion control. When was the last time you heard of a McDonalds being busted by local environmental health.
        If chicken is produced to ‘McDonald’s Standard’ it means it is fit to be imported into the EU, UK, USA and probably Canada, Australia and New Zealand. It means it’s produced by the elite of chicken producers who are big enough to fill a container and can guarantee it will not fail checks at the frontiers because it hasn’t got the proper health certificates and contains no illegal contaminants.
        What McDonalds (or other purchasers who work to the same standard, who might be the wholesaler to whole heap of people like the RIBC) do with the product is not the fault of the producers or shippers 😦

      • robertawrites235681907 August 16, 2021 at 4:38 am

        It was great, you never fail to make me laugh.

      • jwebster2 August 16, 2021 at 4:38 am

        glad you enjoyed it 🙂

  8. rootsandroutes2012 August 15, 2021 at 3:14 pm Reply

    Maybe not, but I’m still left wondering why I need a McDonald’s meal every few years. Is it REALLY that I forget how bad they are? Might I be losing my grip?

    • jwebster2 August 15, 2021 at 3:56 pm Reply

      The last time I had one was about ten years ago. Trains were in chaos, I arrived in London at about 10:30pm on Sunday night and the only place open was McDonalds.
      I think the time before that was when they opened in Barrow and we took the girls to discover what the fuss was about 🙂

      • rootsandroutes2012 August 15, 2021 at 6:11 pm

        The common factor is “the only place open was McDonalds.” We’d even tried ASDA who had a member of staff on duty in their cafe to advise would-be customers that hot drinks were available, and he could even run to a cake… With the benefit of hindsight, perhaps we should have stayed at ASDA.

      • jwebster2 August 15, 2021 at 6:20 pm

        Somebody told me the other day that the Morrison’s All Day breakfast was OK, Cannot vouch for ASDA 🙂

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