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Grimsby Fish Market (photo: Roger Damm via Wikimedia Commons)
'GRIMSBY CAN ADAPT TO WHATEVER COMES UP. WE WILL JUST DEAL WITH IT.' |
WHAT future Grimsby's fish-processing industry? This was one of the subjects of a fascinating and informative UK fisheries debate at Westminster Hall in London on December 13, 2017. Those giving evidence to a select committee of MPs were: Andrew Kuyk CBE, Director General, UK Seafood Industry Alliance; Mark Simmonds, Policy Manager, British Ports Association and Martyn Boyers, Chief Executive, Grimsby Fish Dock Enterprises. MPs present were Neil Parish (Chair); Alan Brown; Paul Flynn; Mrs Sheryll Murray; David Simpson; Angela Smith; Julian Sturdy. Here, courtesy of Handard, is the debate in full.
Chair: Just before I welcome you l, gentlemen, Angela just wanted to make a point.
Angela Smith MP:
I just want to make a declaration of interest. My uncle is a freeman
of the Borough of Grimsby. It is a historic role, but it does involve a
very small financial interest, as Mr Boyers will know, in some of the land of Grimsby docks, on Freeman Street.
Martyn Boyers: It is very small.
Angela Smith: It is very small, but I still need to put it on the table.
Chair: Angela, we respect that. It will be noted. Thank you very much.
Can
I start with you, Martyn? That will give Andrew the chance to catch
his breath. Introduce yourselves and we will fire away.
Martyn Boyers: Good morning. I am Martyn Boyers; I am Chief Executive of Grimsby Fish Dock Enterprises Ltd. It is a private company that runs Grimsby Fish Market.
I have always worked and lived in Grimsby, and I have been in the fish
business for some time. My father and grandfather were both fish
processors.
I am involved in Seafish in various committees they are involved in. I am also involved in the Programme
Monitoring Committee of the European Maritime and Fisheries Fund, which
looks at funding for fisheries. I was also invited to attend as a
stakeholder something that was put together by Defra through Mr Eustice, the Seafood 2040 vision, which was launched about three weeks ago in this place.
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| Martyn Boyers |
Mark Simmonds: Good morning. My name is Mark Simmonds. I am the Policy Manager
at the British Ports Association. We represent over 100 port members
across the whole of the UK, including 47 of the top 50 fishing ports by
landings.
Andrew Kuyk: Good morning, Chair. I am Andrew Kuyk; I am here representing the UK Seafood Industry Alliance, which is a body bringing
together members of two different trade associations, the one that is
my day job, the Provision Trade Federation, and the Food and Drink
Federation. The alliance has the fish processing and trading members of
both organisations come together in this umbrella alliance, and I am
representing the alliance here today. We are the processors and traders
in fish and seafood products.
Chair: That is right. Andrew, you have had quite a lot to do with the Food and Drink Federation over the years, haven’t you? That is how I have known you before in another place.
Andrew Kuyk: Yes, I have had a varied career. The main part of my career was in the UK Civil Service: the former MAFF, Defra and also postings in UKRep in
Brussels and Paris. Then I had five years with the Food and Drink
Federation, and I am now running the Provision Trade Federation. My
roots in fish go back many years to the very earliest days in my career.
Chair:
Thank you very much. The first question is quite a big question, but
it is relatively straightforward. Will Brexit be a good or bad thing
for trade in UK fish? Who wants to start? Mark, go on. You blinked.
It is always dangerous to blink.
Mark Simmonds: It
entirely depends on the deal that is negotiated with the EU, frankly.
We certainly hope so. There are certain challenges that we need to
overcome, but there is certainly potential.
Chair: Indeed, where do you see the pitfalls and opportunities?
Mark Simmonds: Some of the potential pitfalls are with the potential barriers that could be put up, particularly the non‑tariff barriers at ports. A lot of fish leaves the UK
on a lorry going through ferry ports. If those are now going into an
EU port once we have left, they will be subjected to documentary checks
at least and potentially also physical checks.
Chair: Yes—if we are not part of the customs union or we do not have anything in place to replace it properly, that could be an issue.
Mark Simmonds: Yes—some agreement.
Chair: It would be an issue especially for fish.
Mark Simmonds: Anything
that holds up consignments at ports will cause problems, particularly
at ferry ports, which are predicated on traffic flowing as quickly as
possible. Our ferry ports are all exclusively EU‑facing,
so they are not really set up to deal with customs or port health
checks or any other manner of checks that could be imposed.
Chair: Martyn, do you have a view?
Martyn Boyers: At Grimsby Fish Market,
in the last 12 months, we have handled over 12,000 tonnes of fresh fish
at auction. About 75% of that fish has come from Iceland, so we have a
great association and relationship with Iceland. We are hoping that
continues. From a Brexit point of view, we would like to think the
trade rules allow Iceland to export fish in the manner they do at the
moment. We also have a lot of landings of fresh fish and particularly
shellfish. We have a lot of crabs and scallops from Macduff Shellfish, as it happens, landing through the port this year. We have got quite a diverse operation.
Grimsby Fish Market
is also central to a very large processing capacity around the Humber,
and there are about 4,500 jobs connected to fish processing. Grimsby Fish Market, and Grimsby itself, is just a hub for processing and fish activity.
I
see Brexit, whatever the turnout, as an opportunity. There will be
chances to do things. I also look at this from the point of view—this
was mentioned before—of Iceland and the cod wars. Whether we won or
lost, I am not too sure, but I do not see how whatever happens could be anything worse than what happened to Grimsby and Hull then—fleets were decimated.
Grimsby, the people, can adapt to whatever comes up. We will just deal with it.
Chair: There could be greater access to fish, all being well.
Martyn Boyers: All being well, yes.
Chair: Yes, all being well. Andrew, what is your view?
Andrew Kuyk: If
we are talking specifically about trade, I would echo the point that it
depends what you mean by Brexit. It will really depend critically on
the nature of our future relationship with the EU. If we succeed in the
Government’s aim, which we would fully endorse, of a free and
frictionless deal with the EU, certainly on the trade side there may not
be much impact.
It is quite important to understand, though, that we are very much a deficit market for fish. It may sound odd: we are an island, we are surrounded by sea and fish are abundant in that sea, but we still import two-thirds of what we eat.
Chair: We export a lot of what we catch.
Andrew Kuyk: We
have what I call the supply paradox: most of what we eat is imported;
most of what we catch is exported. About 80% of our catch is exported.
There is another asymmetry in this, which is that most of what we
import comes from outside the EU, whereas most of what we export goes to
the EU.
Again,
there will be a differential effect. At the moment, in terms of what
we get from outside the EU, some of that is governed by the EU’s
external tariff arrangements. Fish from Norway, for example, comes into
the EU single market under the umbrella of Norway’s EEA agreement.
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| Andrew Kuyk |
Chair: Regarding Norway and EEA agreement with Europe, how much of that fish would come into the UK? Is it quite a lot?
Andrew Kuyk: Quite a lot of it, yes.
Chair: Is it 50% or not as much as that?
Andrew Kuyk: Do you mean of total Norwegian exports?
Chair: Yes.
Andrew Kuyk: It will not be as much as 50%, but it will be a significant proportion.
Chair: It will be 30% or something like that.
Mrs Murray: We could negotiate our own deal with Norway once we leave.
Andrew Kuyk: It
very much depends on what the framework is. If we are in a close
relationship with the EU, where we are more or less replicating the
terms we have at the moment, we might either a) be constrained from
doing that—because it might be a condition of that new regime that we
were limited in some way in what we could do with third countries—or b)
it might not be necessary, because we get good access to Norwegian fish
at the moment. If that were to continue, there would not be a burning
need to have our own free‑standing deal.
There are different layers in all of this. There is another thing that is important to know about these basic relativities. Two-thirds of what we eat is imported and 80% of what we catch is exported, but it is also a question of the species. The so‑called big five in terms of the UK market are cod, salmon, haddock, tuna and shrimps and prawns.
Clearly, the tuna, shrimps and prawns are things that cannot be caught in our waters. Nephrops is a subset of that, but here we are talking about warm‑water prawns and some cold‑water
prawns from Canada and so on. That is different. Any increased
opportunities for the UK fleet cannot apply to those, because they are
not fish that are in EU waters at the moment.
In
some of those other areas, the supplies of fish that are available in
EU waters, let alone UK waters, are very short of the market demand. In
whitefish, the total availability in EU waters is something like
500,000 tonnes. The market demand in the EU is 3 million tonnes. Total EU cod TAC for everybody is only about 50% of UK consumption. Even
if we somehow magically had control of absolutely everything, it would
still fall far short of current market demand. It is important to
understand those relativities.
Chair: Yes—we need to
understand what we actually eat and how the fish market works. That is
basically what you are saying. There is a big export market and a big
import market.
Andrew Kuyk: Yes.
The reason we export so much fish is because it is by and large species
for which there is no ready market at the moment in the UK. These are
pelagics such as herring and mackerel and some crabs and shellfish,
which are eaten in the UK but are much more highly prized in some other
European markets. Quite a lot of that is landed directly into those
markets or exported live, and it also commands a higher price than people are prepared to pay in the UK. Lots of efforts have been made over the years to try to develop and broaden consumer tastes not just in terms of the market dynamic but in terms of relieving pressure on some of those other key stocks.
Chair: We will go on to talk a bit about that in a minute. That is a good start.
Angela Smith: It is the same question I asked the previous panel, but I will use a different word: “model”. Have you thought through the potential impact of a no-deal, “falling off the cliff edge” scenario? What would that do to the seafood‑processing sector?
Martyn Boyers: We need to recognise there is a huge difference between the UK and the continent in the way fish is consumed,
in that everything in this country is processed. If you go for fish
and chips, it will be a piece that is filleted; there will be no bones
in it; and it might be skinless as well. There is a huge demand for processed fish in the UK, and I cannot see that changing.
I
also cannot see that the great British public are going to change their
habits. There will always be a demand for fish and chips, for
example. You could go into any of the—I do not know how many there
are—10,000 fish-and-chip shops in the UK,
and they will sell either cod or haddock. As Andrew alluded to, they
are the main species and they will continue to be so. The habits of fish consumption are not going to change. In terms of fish processing, the fish needs to be processed.
There
has been an expansion of fish processing in Iceland. You mentioned the
crash in Iceland in the previous session. What really happened was
that skill went to Iceland, but, after the financial crash in 2008, they
then looked at how they could increase the value of fish in Iceland—and
that was through processing. They increased it, and now it has reached
a peak and fallen back a little, so they are looking to export fish. Processing fish is adding value.
Peterhead, Aberdeen, Grimsby on the Humber and the south-west
around Brixham and Plymouth are significant areas of fish processing. I
do not see that changing, because it has to be led by consumer demand.
I believe the consumer demand is there, because fish is a good protein;
it is healthy; it is well regarded. I cannot see there being any
problem.
The
only issue about it is going to be price. We could price ourselves out
of the market. That is going to be the issue—but the demand will not
change.
Mark Simmonds: As I have said before, no deal would likely cause significant disruption at roll-on roll-off ferry ports, at the likes of Dover, where there are currently no or very few checks. Depending on how long they
had, they would suddenly have to change how they do things. A lot of
fish goes out through those ports. I understand the WTO tariffs are
around 10% on average for seafood, so that would have an impact. I am
sure Andrew has a view on that.
But for ports it is non‑tariff barriers, the checks at ro-ro
ports, that would be very disruptive. That is not just in terms of
seafood but in terms of trade in general, of which seafood is a part.
Andrew Kuyk: If
by no deal you mean a situation where we revert to the infamous WTO
rules, it is less dramatic for fish than it might be for some other
foodstuffs. For the EU’s common external tariff, for meat and dairy you are looking at tariffs of 40%, 50%, 60% or more. Ordinary industrial tariffs
are in the low single figures: 5%, 6%, 7% or 8%. Things like meat and
dairy are at the high end, and some can even go over 100%. Fish is
somewhere in the middle, between about 5% and 25%.
If we are talking about no deal, we are talking about the EU tariff schedule applying to trade between the EU and us,
because, in the short term, if we are lifting and shifting the EU’s
external tariff to become the UK’s external tariff from day one, on day
one you would then have those tariffs between us and the EU. For
example, fish from Norway or Iceland at the moment comes to us tariff‑free from the EU, but in the no‑deal scenario it would pay 10% or 20% on day one, so it would face a barrier coming through the EU to us.
You
then get a whole other set of issues that might arise. In that
scenario, the UK Government could decide unilaterally to cut tariffs on
those fish imports, either to the levels that they currently are or even
to zero. At the moment, the European Union operates a system of so‑called autonomous tariff quotas. It recognises that the EU as a whole is a deficit market. That two‑thirds
ratio applies to the European market as a whole, so in recognition of
the fact that the EU market cannot be supplied by EU‑caught
fish, even though those tariff barriers are there in the schedule,
autonomously—that is to say, it is a unilateral thing on the part of
Europe—it lets in certain quantities at reduced tariff.
Now, the UK could operate its own ATQ system. The EU one would not apply to us under a no‑deal scenario, but we could have a UK autonomous tariff quota system. In theory, we could also negotiate a UK‑Norway or a UK‑Iceland
deal. The issues are going to be ones of timing on that, because of
the nature of supply chains for fish, particularly for frozen fish.
I would certainly echo what Martin has said about the value added in processing. That
is the economic engine of the industry in the UK: it is that added
value from processing. The raw material is quite often a frozen block
or a fillet. It has been pre‑processed—i.e.
headed and gutted or whatever—either at sea on a factory vessel or it
has possibly gone to China or somewhere else, and it then comes in as a semi‑finished raw material that we then add value to.
Chair: There is a higher tariff on that, though, isn’t there?
Andrew Kuyk: There are different tariffs. That is why you cannot say there is a single tariff. You get what is called tariff escalation, in the jargon.
The
other thing is that, if you are dealing with a frozen product, the
supply chains are quite long. You would be ordering forward in January
what you would be processing in the following six, nine or 12 months.
If no deal is obvious some way out from when it happens, people would
start thinking about ordering; the Government would start thinking about
the tariff regime they might put in place unilaterally when that point was reached.
If, however, there was an expectation that there would be a deal and then at the last moment you had no deal, you would get a great
crashing of gears. You would have people committed to supplies; you
would have things in the pipeline; and you would then have to have what
would effectively be emergency legislation to unilaterally change UK
tariffs in the event of that.
Chair: In an ideal world, you would like
to know either that there is going to be a good deal or that there is
not going to be a good deal. You would like to know that in advance,
but you are probably not the only one who wants to know that.
Andrew Kuyk: What
business craves, above all, is certainty. Business will adapt to
whatever hand it is dealt. Obviously, there is a strong preference to
stay as close as we can to existing trade arrangements. Trade is a
mutually beneficial activity. It is reciprocal; that is why it
happens. There are benefits to buyers and sellers in a trade
relationship.
The
ideal will be this aspiration of a free and frictionless deal on trade,
and we would ideally also like to see trade dealt with as part of food
trade in general, separately from other issues related to fisheries,
which we are not discussing here.
Angela Smith:
I just want to ask one further question. I had to smile at what Martin
said about skinless and boneless fish. My father fished in Iceland,
and he could fillet a fish brilliantly. He would always fillet it, and
there were no bones in it whatsoever. That was the standard, if you
like. That is just an anecdote.
I wanted to raise a point about the supply chain and the tariffs. This is a question for all three panellists.
It may well be that we get a deal or that we do not get a deal at all,
either with tariffs or no tariffs. However, exporting our processed
fish onwards into the European Union is also a question that has to be considered by the industry.
Has any of the panellists thought through the potential impact in terms of exporting our products processed from fish imported from Norway and Iceland in particular? What might the impact be on that either in a no‑deal or a deal scenario?
Martyn Boyers: In
Grimsby, we have a lot of fish that is imported. It comes into Grimsby
and it is processed. Sometimes it is just repacked and it goes off
into France and into Europe. Grimsby acts as a hub.
The
principle is not going to change; it is the terms of engagement that
are going to change. It is about what goes around it. The French and
Spanish demand for fish is not going to change; the UK demand for fish
is not going to change. It is what happens around that, what the rules
are and what the costs are.
One of the things we have to bear in mind with all this, particularly from our point of view as Grimsby Fish Market,
is that we are a private business. We are there to make money.
Sometimes we talk about fish in a very sort of romantic way, but we must
not forget that it is a business. It is about commercial fisheries.
The fishermen have to make money; the processors have to make money; we, the fish market,
have to make money; and then the retailers have to make money.
Everybody is taking a bit of something out of it all the way along.
When you have this sequence, every one of them is a buyer and a seller. That is why you will never get an agreement within this
fish industry, because it is a sequence of buyers and sellers—who
always disagree. Ultimately, as we go forward, the issues will be
resolved, but it comes down to how much we will pay. If you go for fish
and chips, and it is going to cost you £10, you will not bother. If it
around £5 or £6, you will say, “That is all right.” Price is always
going to be critical, and there is a cost involved.
Processing
is a cost, and it is an added value. It turns it from being a whole
fresh fish into an actual fillet, but that balance is going to be the
difficult thing. What will be to cost of
the rules of engagement that allow the trade to continue? If it gets
too daft, people simply do not buy. It is not because they do not want
to buy; they will not be able to afford to buy.
Angela Smith: They just will not be able to buy.
Chair: They will buy something else.
Martyn Boyers: At
that point, they will buy something else. Fish is competing with other
proteins. The cheapest protein is of course chicken, and we cannot
compete with chicken. Fish always has to push its unique position and
its health benefits.
That is why this Seafood 2040
vision is quite optimistic about the future. It looks at things we can
do to change the way we eat; it looks at trying to get people to eat
two portions of fish a week. On that basis, everybody would get a lift:
the fishermen, the processors and all of us. If consumption goes up,
we will all do better out of it—but that is balanced with the price of
it, the value of it and what people are prepared to pay. That is the challenge.
Of
course, we have just had inflation figures and so on; there is a
squeeze. When people come to a choice between chicken and fish, if
something is half the price they will say, “I will have that, then.”
That is what will come out in the wash. The actual demand for it is not
going to change a lot; it is how it will work.
Angela Smith: It is price and demand and how they interact.
Chair: Can we keep our answers a bit more concise? I am a bit conscious of time.
Andrew Kuyk: On the export side, we export some processed fish, but by and large we import raw material that we add value to to supply the domestic market. There is a trade in some exports of processed products, but the main exports—the UK catch—are primary raw materials. In a no‑deal scenario, that would then face tariffs going into the EU.
Logistically,
while we could send processed products to America or other places, you
cannot really send the raw, live fish. The distances are too great.
Our biggest trade is with our nearest neighbours, and particularly with a perishable product that is very important.
Chair: Yes—for obvious reasons.
Angela Smith: Very finally, Martyn, what is the balance between exports and selling on your processed fish into the UK market? What proportion goes to France?
Martyn Boyers: In
Grimsby itself, I would say that 85% is processed for UK consumption.
There are people selling into France. One of our major customers, who is Icelandic, has a company in Boulogne. Fish comes into Grimsby; we repack it; and it goes to Boulogne.
There
are other people exporting and, as Andrew has mentioned, a lot of the
fish that is processed goes to Europe. There is a big demand in France
now for cod loins, which are pieces of skinless and boneless fish. They
have got used to skinless and boneless fish as well. There is an
opportunity to do the work. It is always going to come back to the fact
that it is a trade and a commodity.
We
must not forget that fish is highly traded. The two things people
always ask you are, “What is the quality?”—and everybody says it is
good—and, “How much is it?”
Andrew Kuyk: I think I am right in saying that fish is the most internationally traded food commodity.
Chair: I suppose it is. It is interesting how the price is so important.
Mrs Murray:
First, the fishing industry gave me and my family a really good living
for 23 and a half years, so I take on board exactly what you say about
everybody needing to make something out of it.
I
have picked up that it is really important to have a transition period
in any negotiations after March 2019. Before I come to my question, Mr Kuyk, you have talked
about exporting and how you could not export a fresh commodity, but is
airfreight not increasing as far as sending shellfish to China and
things like that are concerned?
We
heard in the last session that it is really important to have chilling
facilities at regional airports. What you have said is, “We do not do
that.” That seems to be what I have picked up. Surely that is one
thing you would like to correct. We do already export using airfreight.
Andrew Kuyk: We do. First, that area of trade is not the bit that my association represents. Yes, it does exist, but the bulk of that
80% of the UK catch that is exported is physically landed into France
and Spain and so on. Yes, it is possible to airfreight fish, and I
understand there is a growing market for premium shellfish—crabs and
things—in China, but it is a relatively small thing. Again, it comes
back to the fundamental thing: price. Are we going to be competitive?
Technically, yes, it is a possibility, but it is a minority of the current trade, and there would have to be a major re-engineering in order to do that in the volumes required to replace the direct landings.
Mrs Murray: Thank you very much. I just wanted a brief answer there, but it was something I did pick up on.
Is there scope to grow fisheries outside of the EU following Brexit? It is
heartening to know that 85% of the fish in Grimsby, contrary to what is
sometimes expressed, is for the domestic market. Would we have
opportunities to look further afield than Europe? We
are seeing an increase in exporting using airfreight and we have
already picked up some very good deals last year as far as shellfish
exports to China are concerned. Will there be
opportunities? At the moment, are you looking at this and thinking,
“We can use this as an opportunity to grow the shellfish, whitefish and
pelagic fish industries in the UK post Brexit?”
Martyn Boyers: There is opportunity. We need to look at the way the market operates at the moment. The market is consumer‑led. Historically, people liked cod and haddock because their mum and dad liked cod and haddock. If it is supply‑led, it might be different. There is an opportunity there.
Instead
of UK fisheries exporting 400,000 or so tonnes of fish a year, we could
keep that and not import so much. We can also improve on aquaculture.
That has always been much maligned in the UK. There is an opportunity
with aquaculture in the UK as well, where we can develop that. We need
to look at the way fish gets to market and what people eat and consume.
Earlier
on, other species were mentioned, but we also must remember that fish
is seasonal. People have forgotten that, because supermarkets want to
sell the same thing all the time. There
is seasonality to fish. There are opportunities to bring in different
fish and try something different. It will not happen next week or next
year; it is a long‑term
thing. The way we have all been brought up and what we are used to is
what we like. It is the big five, as was mentioned. It is about cod and
haddock. It will be a long, long time before anybody gets away from
that—but it is an opportunity. That does not mean to say we should not do it.
Mark Simmonds: I would just agree with what Martyn has said wholeheartedly. There is absolutely an opportunity to export more. Airfreight is not something my members would want to come here and encourage.
Mrs Murray: No, exactly.
Mark Simmonds: Obviously, that is high‑value stuff. Most of the stuff that goes out through ports for export is going to Europe—a bit closer.
There
is absolutely opportunity. It depends, of course, as everything does,
on the deal we have. Presumably, going down the track we are on will allow us to reach out and take those opportunities. That is an upside.
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| Mark Simmonds |
Mrs Murray: I did try to help you a few years ago with my Private Member’s Bill, the Marine Navigation Act, making
it easier for you to operate as a port. I do take on board that you
would not want to see competition from airfreight too much.
Andrew Kuyk: I would echo the point. Airfreight is high value and low volume. I come back to basic relativities: we import two-thirds
of consumption. If we had increased catching opportunities and
increased supply, the most obvious thing to do with that would be import
substitution—because the market is there. You would be landing into
your own market. That would be far easier.
I am not anti‑export,
and I am not ruling it out, but if you take cod, for example, UK
catches are less than 10% of current demand. If we were able to catch
more cod, why would we seek to export that rather than increase supply
to our own market?
Chair: Is there not an argument at the moment that we are inclined to export high‑value cod and import lower value cod? That happens quite a lot, doesn’t it?
Martyn Boyers: It does.
Andrew Kuyk: However,
that is a feature of what the consumer is prepared to pay. The whole
point of trade is that you optimise your market. If you can get a
higher price for something from somebody elsewhere, then you will do
that, and that gives you your overall business proposition. However, if
you are looking at the main drivers of the market, the big numbers are
supplying the domestic market, where we are a deficit market.
Chair:
Your argument would be, yes, look for export markets, but you also
think there is a way to substitute quite a lot of imported fish, which
leads us on to the next question. I am conscious of time—Angela, very
quickly, please.
Angela Smith: There
have been numerous campaigns over the years to change British eating
habits, when it comes to fish. None of them have really proved
successful. We have an enduring love of haddock in Grimsby but cod in
most parts of the country. Martin said it would be very long term. We are talking decades, aren’t we?
Martyn Boyers: The opportunity exists in that the fish that are exported are high value. If you look down in the south-west, you are looking at a lot of the turbot, brill, Dover soles. High-value stuff
is being exported, the reason being that our European colleagues pay
more money for the fish. It is as simple as that. However, if there is
some constraint on trade and tariffs, that fish might not be sold
abroad, and that means they would have to sell it into the UK.
Chair: Can we leave it there? I am conscious that is another question. One last point, please, and then I have to bring David in.
Mrs Murray:
I have not got any more questions, but I want to offer you my
apologies, because I do have a question in the Chamber, so I will have
to leave. Apologies to the witnesses.
Chair: Thank you very much, Sheryll. Can I move on to David now, please? Thank you, Sheryll.
David Simpson:
Chairman, there has been a lot of discussion, and maybe Andrew touched
on this question, over a number of weeks and months in relation to trade
agreements, such as bilateral trade agreements. Taking that into
consideration, how dependent are your businesses on imports of fish from other EU countries? Is it important to get that in a trade agreement, because of the import of fish?
Martyn Boyers: For us in Grimsby, as I said earlier, 75% of our fish is imported from Iceland, which is a non-EU country. We also get fish from Northern Ireland. A
lot of fish comes over to Grimsby from Northern Ireland as well, but
obviously that is from within the UK. We also get fish from Scotland as
well. I suppose we are one of Peterhead’s biggest customers. A lot of
fish comes down from Peterhead as well, for the auction. However, the
main business with us is with Iceland. If
that were curtailed, for whatever reason, we would struggle to
continue. We would have to look at the job seriously and see what other
alternatives we had.
David Simpson: That is fish coming in from Iceland, is it?
Martyn Boyers: That is fresh fish coming in from Iceland. It comes in by container.
Mark Simmonds: Most
of our members are focused on the EU, but like I say we represent 100
ports and a lot of fishing ports, so there is quite a variety. Some of
them are entirely focused on the EU, though.
David Simpson: Are you saying that,
whilst the conversation has been had today in relation to WTO, the best
option for you guys is a trade deal without going to the unknown of
WTO?
Mark Simmonds: The
British Ports Association’s preferred option is a deal that secures the
benefits that we currently enjoy from the customs union and the single
market. We recognise it is Government policy to leave, but a lot of the
external trade from our ports goes through roll-on roll-off ferry ports, and they do not have the infrastructure at the moment to deal with checks, whatever they might be. Something
like 36 agencies can intervene at the border at the moment, and any
kind of checks or barriers that are thrown up there will cause
disruption.
David Simpson: Andrew, do you want to finish?
Andrew Kuyk: Yes,
in fish nothing is quite as straightforward as it seems. A lot of the
fish we import originates outside the EU, but physically it comes
through EU channels, because its first point of entry into the single
market could be through Rotterdam or ports in Germany. Also, as I
described, a lot of what we import as raw material has gone through a
first stage processing of some description, and that can also happen in
another European country. A fish from Norway can go into Germany, have a
first-stage processing operation in Germany and then come into the UK
from Germany. It is not as simple as to say that, because it comes from outside the EU, a tariff barrier with the EU would be irrelevant. If it is coming in transit through the EU, the same is true for things going in the other direction. That interface with the EU is critical at the moment, even for non-EU fish.
We also have a lot fish, such as Alaska pollock, as the name suggests, coming from waters in North America. That, again, can be landed through Rotterdam. Your
Committee is probably familiar with the Rotterdam effect. It does
disguise the official trade statistics, which do not tell us the reality
of the trade flows. Again, in fish it is quite misleading. If you
interrogate the HMRC figures, you will find that China is a leading
supplier of fish to the UK. It is not Chinese fish;
it is possibly Russian fish or American fish that has gone to China for
basic filleting and pre-preparation in a frozen block. The block comes
from China; therefore, it is lodged in the figures as an import from
China.
The
pattern of trade flows is really quite complicated. It has been
optimised to what the present situation is. If we faced a situation
where there was dramatic change, those supply chains would reorganise. Instead
of something coming via Rotterdam, this might be an opportunity for
Grimsby or other British ports, but there is a capacity issue there.
Have we got the physical capacity to scale up operations to deal with
that? If it has gone through a first-stage processing somewhere else,
have we got the physical capacity to build that in the UK? Would there
be the business model? There are some fairly basic issues that colleagues from ports will understand only too well:
cold storage, refrigeration capacity. Again, it is optimised to
current trade flows. You would not have cold stores standing empty 300
days a year.
We
know that there are examples of trade in the UK where fish is stored in
Boulogne, for example, because there is capacity there. It does not
matter. It is as simple as London to Sheffield, or something. Boulogne
to here does not matter at the moment, but it will if you change the trade regime and put in tariff barriers or non-tariff barriers. We are looking at the tariffs, but there is everything that goes with them: the health certification and, in terms of fish, the IUU regulation, catch certificates, and so on. That is another layer of complexity in the fish area that does not apply in some other areas.
Chair: Thank you. David, are you done? Angela quickly, please, and then I will move on.
Angela Smith: On
trade and tariffs and non-tariff barriers, I am aware that Grimsby has
asked for free trade status within a European Union deal.
Martyn Boyers: Some people, not me.
Angela Smith: Not you. I would like to hear about it, Martyn, because it has made big news in our region, of course. Could you outline the reasoning behind that? I find it quite an odd—
Martyn Boyers: I do not know the reasoning, because I was not involved in the announcement. There is no substance to it or justification for it at all, because we are a UK fishery. You cannot have Grimsby in isolation. We are part of the bigger thing. I do not go along with having us as a free trade port at all. That is not going to work.
However, Andrew was talking about fish coming in, and one
of the things we need to be clear about is fresh fish, because you
cannot delay fresh fish. If it is frozen, you have a bit of a chance,
because you can cold-store it. However, with fresh fish you have had
it, because the value will deteriorate rapidly, especially when you have
shellfish: scallops, crab and lobster. You cannot hold it up. That is
going to be the main issue.
Chair: Yes, that has come through to us really loud and clear, not only from you but from the other witnesses.
Martyn Boyers: We are the same. We are bringing in fresh fish. The organisation in Iceland, Fiskistofa, which is the Icelandic ministry, used to be on Grimsby Fish Market, but they changed the system—again, cost-cutting. They inspect the fish in Iceland before it comes. When
it comes to us, it has already been customs checked, and they put a
seal on the back of the container. When it arrives to us, if it has not
got the seal intact, we do not open it. That has never happened. There is a system in place.
Mark Simmonds: On the free ports, our understanding is some of our members are keen on it, others, like Martyn, less so.
Chair:
It is obviously quite controversial. It sounds a little bit like a
nuclear free zone, but I do not know if it works quite in the same way.
Mark Simmonds: We understand it is off the table and it is not being considered until at least after a deal is agreed.
Chair: Thank you very much for that. Can I bring in Julian, now, please?
Julian Sturdy: I do not think we will get a straight answer to this question, given what you have just said, Andrew, but, Martyn, you talked about price being absolutely critical and touched on the fact that 70% of your fish comes from Iceland. Is there concern that fish prices might rise in the UK for consumers in the short term when we leave?
Martyn Boyers: It
is an interesting thing about price, because if you are dealing in
fresh fish, fresh fish is a very volatile market to trade in, and any of
those people who deal in fresh fish will also have great difficulties
on cash flow,
because the price of fish goes up and down very much so. Frozen fish
is more of a commodity, and there is a bit of stability, but the ebb and
flow are more like an ebb and a flow. Fresh fish spikes. We have seen
on the fish market in Grimsby, for haddock, anywhere between £1.50 a
kilo up to £5 a kilo. A lot of that is down to supply and demand.
The basis of the fish market, and one of the things I advocate—and I would do, being in the fish market—is determining the price of fish. Grimsby always has been, and continues to be,
a benchmark for the value of fresh fish on any given day. You have the
fresh fish market, which goes up and down subject to what is available,
and then frozen is a bit more of a stable market, and people process
from more of a stable market and supply from a stable market. The
price fluctuation is something that depends on the circumstances. For
example, this week we have had all this bad weather. The price of fish
dropped, because people could not get fresh fish into the shops, and so
on. The week before it was at a record high.
Julian Sturdy: Why was it at a record high the week before?
Martyn Boyers: It was the opposite effect. The demand is constant, but the supply varies. The supply situation was low. There was not much fish from Iceland; they had a lot of high wind and bad weather up there. Fishing itself had gone down and up goes the price.
We have this movement in fresh fish, and it is volatile. It is very important that we maintain the auction markets in places like Peterhead, Grimsby, Brixham, Plymouth and Newlyn,
because they determine the price of fish. That is always an issue,
because there is a lot of pressure from supermarkets to keep the prices
down. However, when you are dealing in a natural commodity that people
go out and catch, the price fluctuates.
Julian Sturdy: What if we had tariffs coming in?
Martyn Boyers: I
think they would be reflected. I do not know who would pick up the
tab, but somewhere down the line somebody would end up paying for it.
Julian Sturdy: It could be the consumer.
Martyn Boyers: It could be the consumer. It could be us. It could be the Icelanders; it could be the Norwegians.
Chair: Andrew and Mark, do you have anything briefly please? I am conscious of time.
Andrew Kuyk: First, it has emerged from some of the things Martyn has said that
the fresh fish market is different from the frozen commodity market,
and that is less susceptible to these price fluctuations. There are
different elements in price. Currency, latterly, has been quite an
important factor, because as we are heavily dependent on imports,
the devaluation of sterling effectively since the referendum has put
price pressure on that. Some of that is absorbed within the chain; some of that is being passed on. At the moment tariffs are not a major issue, because although some tariffs do apply for some of the third country imports we do not have totally tariff-free—
Julian Sturdy: That is because a lot of it is coming into the EU.
Andrew Kuyk: Yes,
the Norwegian fish is not tariff-free into the EU, and I have talked
about the autonomous tariff quotas. Some of those are to zero, some are
not to zero. We also import some fish on which tariff is paid, but
those have been stable and so factored in. An increase in tariffs will
then add to the currency effect, because those are both going in the
wrong direction: both are increasing the cost of the raw material. If
we have a situation where we have new customs declaration certification
requirements that do not exist at the moment, that is an added
transaction cost we do not have. Estimates vary, but that could add
between 5% and 10% of price—just
those formalities that have to be gone through. Martyn has talked
about the sealed container. That is one way of dealing with that. That
is a very specific case, but if we are talking about an EU/UK deal,
those sorts of streamlinings would have to be generalised, and there may or may not be a cost. All those cost pressures are going in one direction.
The other thing that has come out—I am not sure it is a direct answer to your question—is
the seasonality. Fish is very globally traded. That diversity of
supply, again, enables that year-round continuity. What consumers are
looking for is a consistent product.
Chair: We will leave it there, because they are very good answers, but they are getting very long. Are you finished, Julian?
Julian Sturdy: Yes, that is fine.
Chair: Alan, please.
Alan Brown: What I was going to ask has been covered.
Chair: You are reasonably happy.
Alan Brown: I am happy to come back in later on.
Chair: Okay, I will go on to David then, please.
David Simpson: Is there an opportunity with Brexit for the UK market to improve itself as a world leader in sustainable fish? Are there opportunities there while it has a good reputation? Can it move forward again to go to that next level?
Martyn Boyers: The UK fisheries sector
is in a good position. I do not think we should criticise it too
much. There is far more traceability now within the systems than there
ever used to be. The BRC, British Retail Consortium, accreditation was mentioned in the previous session. Lot of businesses have that, and we are one of those. We also have the Marine Stewardship Council accreditation.
Businesses are very conscious of the requirement to have traceability. Part of that traceability is to make sure the fish supply you are receiving is from a sustainable fishery. In the UK, most of the businesses do the job properly. I honestly do not think that is an issue. We can improve on it and become world leaders. I would be surprised if we were not one of the world leaders at the moment.
David Simpson: Absolutely. Mark, what do you think?
Mark Simmonds: I would agree with everything Martyn said.
David Simpson: Andrew, do you want to add anything?
Andrew Kuyk: Yes, briefly. I have been involved with the common fisheries policy on and off at various points in my career. It has had a chequered reputation. Latterly there have been big improvements, and a lot of those have been UK-driven. It has been UK Ministers who have been at the forefront, whether you are talking about IUU regulations, landing obligation or
technical conservation measures. The UK has been very much at the
leading edge of that, and the UK industry has been pioneering things to
do with responsible sourcing, supply chains, traceability and so on.
There
is potential for us to go even better, and people point to the other
models, Norway and so on, where the sovereign control has given them a
greater ability to set measures in accordance with the prevailing
circumstances. Inevitably, in a European Union of multiple member
states, political decisions are subject to an amount of compromise. There has been far too much compromise in the history of the common fisheries policy. It is a lot better today, but we are aware of the December quota setting and so on. That has not been exemplary.
Chair: David is happy today, because Northern Ireland has got a good amount, but he would not have been so happy in the past when it has been a lot less.
Andrew Kuyk: Yes. The
UK does have an opportunity, depending on what happens. Again, this is
separate from the trade thing. This is talking about the management of
waters and the fish.
Chair: I suppose it is how we catch it as well. We were talking about line-caught fish. I know we are not going to go out and catch all the fish by line, but there could be potential there.
Andrew Kuyk: I would flip the question: if we do not get a good outcome on fish—and by that I do not necessarily mean a good economic outcome—and we get a situation where the perception is that the system is somehow not going to function because of political disagreements, such that
there is a doubt in the consumer’s mind about the sustainability of
stocks as a result of a disorderly way forward, that will damage
everybody. There
are two sides of the same coin. Getting it wrong would reputationally
damage everybody in the industry, whether catcher, whether processor; it
would be bad for everybody. Getting it right is a great opportunity
for us to be an exemplar and to be world leading in our sustainable
management of the resource.
Chair: Thank you. Mark, do you have a comment?
Mark Simmonds: No.
Chair: David, you are done? Julian now, please, then Alan, then Angela.
Julian Sturdy: This is specifically a question to you, Martyn. You touched on—and it has been talked about throughout
this session—that the value of fish decreases very quickly over time.
Have you done any modelling within the business to estimate the
financial problems that could be caused through hold-ups at customs,
non-tariff barrier checks, et cetera?
Martyn Boyers: The only example I can give you is the fact that the fish we bring in from Iceland is basically on a ferry service. It
arrives into Immingham on a Sunday afternoon and is brought by lorry to
the fish market and we sort it, weigh it, unload it and put it on the
fish market on Monday morning. When that vessel has been delayed for
whatever reason, and just lately it has broken down a few times, the fish on board is still on board. When
it arrives a day late or two days late, we still have to handle the
same fish. You can see the deterioration in the fish, because it is two
days older and it is fresh fish.
One of the issues to be able to deal with is to understand that,
if it is fresh fish, it does need to be dealt with straight away. If
there were delays in the whole fish transport and logistics, fresh fish
is never going to get better. It never improves. Do not let anybody
tell you any different. It can only get worse.
Julian Sturdy: When that happened, and that was delayed for a couple of days, what happened on the market floor on Monday morning?
Martyn Boyers: Generally what happens is we carry on doing the same work, but the value of the fish goes down.
Julian Sturdy: The buyers were paying less.
Martyn Boyers: The buyers pay less, because it is not as good.
Chair: I suppose potentially it can go off.
Martyn Boyers: It
takes quite a bit for it to go off, but the value goes down. The
merchants do not pay as much because it is not as good quality. Also,
because it is already a bit older it does not have any shelf life. It
is not as valuable to them; that is why the value goes down.
Chair:
The evidence we have taken this morning has really shown that getting
things through borders and border posts, if there were such things, is very important, no more so than in fresh fish. Is there anything else anybody wants to add?
Andrew Kuyk: On your modelling point, it is difficult to model because this is unknown territory. It is not just what the UK puts in place; it is what our counterparts in other member states put
in place. We could have frictionless on the Dover side, but if it is
not frictionless on the Calais side, you still get the bottleneck. You
need both halves of the equation.
Chair: Yes. We had a little problem with lambs and various things in the past, didn’t we? That was through single market regulations, so it will be interesting.
Andrew Kuyk: Just as trade is two-way, borders are two-way as well.
Chair: We are conscious of that.
Alan Brown: I will just pick up on that. The UK Government has pledged to leave the single market and
the customs union. Now they keep saying that, yes, we support having a
free and frictionless trade border that mirrors the single market and
the customs union. What does that look like?
Chair: That is a really simple question, that one, Alan. However, it is a very good one. Does anybody want to have a stab at that?
Martyn Boyers: My
interpretation of it would be that we want it to carry on as it is. We
are bringing in fish from Iceland, and that is not a problem. We are
bringing in fish from Norway, and that is not a problem. We would like to think that whatever comes up in
the agreements, the trade can continue. Being old enough to remember
the original vote in 1973, it was about trade. We are a trading nation,
and fish is a traded commodity. This is all about doing business, and
it is the conditions in which you do the business. Whatever it is we
just need to deal with it and do it quickly, as far as fresh fish is
concerned.
Chair: Andrew, I cannot believe you cannot say something on that one, but quickly, please.
Andrew Kuyk: That is an excellent question, and it goes really to the heart of much of this debate. Yes, we aspire to have something as close as possible to what we have got, but the European Union is a legal entity—it is a treaty-based thing—and
also trade takes place within the wider multilateral framework of WTO.
If we are a third country, that does change the rules under which we
operate. If the EU offers us preferential terms, that is fine if it is
within a trade agreement.
I do not want to go on too long, Chair, but the basic principle of WTO is that you treat people equally—most-favoured
nation—unless you have a separate bilateral deal that derogates from
that. The problem, it seems to me, is that if we are officially a third
country—not in the single market and not in the customs union—yes,
you can agree zero tariffs as part of a trade deal, but it is the cart
and the horse. You have to have the trade deal for that to work in WTO
terms. Then on procedures, as well, if we had a derogation from
procedures that the EU applied to imports from America or elsewhere, you would have to make sure that, again, was watertight in terms of a trade deal so that it was not vulnerable to challenge by other third countries.
Chair: We are going to leave it there. That is a good point. Mark, do you want to make a point?.
Mark Simmonds: We have been discussing this with various government
departments and agencies for the last year or 18 months, and what we
have always been very clear about is that a frictionless border must
mean no extra checks at the port. If there need to be checks, they need
to happen somewhere else, otherwise they are going to disrupt the
flow. Again, I am talking mostly about ferry ports.
Chair:
That is so important. Whatever the rule, however it is done, it is how
we can physically get trade in and out without it being held up. As
you said, it is nowhere more important than with fresh fish. That has
been brought home to us very loud and clear.
Alan Brown: This follows
on directly from what Mark said there. If there is a new customs
regime, are you saying at this moment in time the ports could not handle
that? It would need to be, with this infrastructure, checks done elsewhere.
Mark Simmonds: We do not know what a new customs regime would look like, so it is hard to say whether they would be able to handle it.
Alan Brown: That is if it involved additional checks, compared with what happens now.
Mark Simmonds: With roll-on roll-off ferry ports, the model is that the ferry rolls up, the trucks drive off, and they are coming from Europe,
so there are very few checks for the vast majority of lorries, so they
just drive straight on through. There is no space to hold them up. Any
delays there obviously cause problems and disrupt the flow. That is
the issue. Whether they can handle it depends very much on what they
are being asked to handle and what checks would look like. Even a check
that takes a minute, just looking in the back of a lorry, would be very
disruptive once you add that on to 200 different trucks.
Andrew Kuyk: I am not
trespassing on your territory, but there are different sorts of
checks. Customs is one area. There is port health, border inspection
posts. They are different. Again, at the moment, for intra-EU trade those are not necessary, but if we become a third country we may need to have those. The point you made, Chair, is that it is not just what the rules say on paper; it is the spirit in which they are implemented and enforced. If there is mutual co-operation,
that is quite different. If people are going to insist on a much
higher level of physical checking, or if the stamp is in the wrong
place—
Chair: If you want to find a problem, you can almost manufacture one, can’t you?
Andrew Kuyk: Absolutely.
Mark Simmonds: At the Port of Felixstowe, for example, which is a more globally facing port—it does containers—my understanding is that about
75% of the checks there are port health checks, rather than customs
checks. That is a port that has space to do that, because it deals with
trade outside the EU. Other ports, like Dover, for example, which are
focused entirely on the EU, where a lot of our fish goes to and from, do
not have that space to do that. Andrew is absolutely right:
customs would potentially be disruptive, depending on what it is, but
it is the other checks. As I said earlier, there are about 36 agencies
that have the power to intervene at the border.
Martyn Boyers: The
existing system, particularly with Iceland, as I said earlier, works
okay. We get fish from Norway and it works okay. We get fish from
Europe and it works okay. We just hope that whatever it is, it
continues. It is just at the back of everybody’s mind: when people are dealing with fresh, it is having the system in place that does allow a quicker movement of it. That is all.
Chair: Yes, down from veterinary right the way through—I think that point has been made.
Angela Smith: We have had no questions about labour to this panel, so may I change the question a little, Chair?
I remember the cod wars perfectly well, but on the Humber we had
petrochemicals, chemicals and men going out to the oil rigs as well. We
had alternative sources of employment, but we still suffered. Is there still a shortage of labour supply in Grimsby? Findus, Ross and Birds Eye have gone. Is there a shortage of labour in Grimsby, and are you filling that with eastern Europeans, European Union workers? What is the situation likely to be in the future?
Martyn Boyers: On the Humber, there are 4,500 to 5,000 people employed in fishing. I do not think it is about the employment. In our industry, in fisheries, it is more about perception and allowing people to think that it is not a bad business to be in. We
do ourselves down at times, and with our own staff in particular, we
train people. We give them some sense of having a career and an
opportunity. We look back on it:
we used to have the old lumpers, and people thought, “If you do not get
an education, you can always be a lumper.” We have to move past that
and look at it as a proper occupation, with an opportunity. It is the
perception. We do ourselves down about employment. I do not think
there is a problem with employment—I really do not. There is an opportunity. However, the clear thing about working in fisheries, especially in Grimsby, is you
have to be prepared to work. It is not for the faint-hearted. You
have to have a good attitude. That is the determining factor about
employment.
Chair: That is a well-made point.
Andrew Kuyk: Broadening
it slightly from Grimsby, the food industry as a whole, and that
includes fish processing, is more heavily dependent on non-UK labour
than many other industries. It is an issue for the food industry as a
whole.
Angela Smith: Generally—yes.
Chair:
Yes. We have been taking evidence from everywhere through the
processing industry and have found that to be the case. We are aware of
that.
Angela Smith: I take the point about attitude and everything else. I understand that. I will do the proper question now, Chair. Grimbarians never do what they are told—that is the problem.
If,
following Brexit, the UK sees an increase in the number of fish landed
into its ports, does business have the infrastructure available to meet
demand? Are you equipped and ready in terms of skills?
Chair:
Yes, because a lot of fish at the moment is being landed in European
ports on our quota, isn’t it? We may have solved that quota, I accept,
but there are arguments about that. That could all change, couldn’t it?
Martyn Boyers: Within
the UK structure of fishing ports, there are a number of auctions, and
there has been a consolidation of auctions over the years, so there are
nowhere near as many as there used to be—there are only a few. But there are quite a number of places of landing, where you can land. They are called designated ports, which have all been approved. The
capacity within the UK is okay. The actual infrastructure that is
required to land vessels does need some attention, because you do need
to invest in, for example, cranes, hoists, winches—that sort of thing. Also, you need chilled storage capacity, boxes and all those sorts of opportunities.
In
Grimsby, where we are now, because we have seen a decline in landings
historically—I will not bother you with that detail—we are well placed
to increase capacity without any problem. We do not have to invest too
much to take on a lot more. We could certainly do it. In other ports,
like Peterhead, which is extremely busy, as was mentioned earlier they
are spending a big amount of money on improving the port, so they will
have a fantastic facility up there. Also, I mentioned earlier being
involved in the European Maritime and Fisheries
Fund. There is a vehicle by which people can obtain funding to support
any development in infrastructure, and that is another important
element in whatever we do post Brexit:
to allow ports to be able to access funding to improve the facilities
they provide to the fishermen. It is important to know that the ports sit
fairly between catchers and processors. They do have a vital role, and
as I mentioned earlier about the detail of the industry, we have also
been working on a Responsible Fishing Ports and Harbours scheme, making sure that the fishing ports are accountable and that they do a proper job.
Chair: Are there any last points, Andrew or Mark?
Andrew Kuyk: By and large the capacity in businesses is optimised to the present situation. You
have three phases. You have the landing, the auction, and then the
processing. You will not have idle processing capacity. You will not
have empty cold stores, because why would you? You have that optimised
to a given level of supply.
Chair: As we land more fish, you believe that the processors will pick that slack up, do you?
Andrew Kuyk: They would need to build extra production lines.
Chair: Providing the fish is being landed and there is demand and sale, you think the market will deliver?
Andrew Kuyk: It will take time. You would need investment, labour and skills. You
would need time and money. You would need the investment, and to make
the investment you would need to make the business case. You would need
to be certain that you had a profitable market at the end of it. Chair, you will be very familiar with this: one of the economic features of agriculture and fishing is that, if you get abundant supply, price tends to come down.
Chair: Yes—or vice versa.
Andrew Kuyk: That
is a dilemma. Yes, you might have more supply, but if that lowered the
price, the economic case for investing in the capacity might not be
there.
Chair: That is a fair point.
Mark Simmonds: Just
to echo what Martyn said, we have recently done a survey of our fishing
ports on their infrastructure. They are all very different, but it is
absolutely essential that there is something to replace the European
Maritime and Fisheries Fund.
Alan Brown: We have heard there are possible opportunities for catching and landing more fish. The UK Government are selling a post-Brexit nirvana. In terms of making the best of these opportunities, we have heard about the infrastructure upgrades that will be required. Have the Government been speaking to anybody about what infrastructure upgrades will be needed and what the cost will be, in light of the funds they might make available?
Martyn Boyers: We have had a number of discussions on this at the Programme Monitoring Committee of the European Maritime and Fisheries
Fund when projects have come forward. There is a lot of opportunity
for ports to improve, but only where there is going to be the
trade to justify the business. You cannot do it just on the basis that
you are going to do it. It is the chicken and egg scenario. You need
the business first to justify spending the money to invest in the
infrastructure.
Mark Simmonds: We have been
in regular discussion with Defra, the MMO and Marine Scotland about the
importance of the EMFF and the importance of a replacement fund. We
have not heard an awful lot back about what might follow, if anything.
My understanding is that there probably will be something—there will probably have to be something. However, we still do not really have much of a handle on what that is.
Alan Brown: When would you be looking to get more details on what that is going to look like?
Mark Simmonds: As soon as possible, because the EMFF goes until March 2019, and that is coming up quite soon. It would be as soon as possible.
Andrew Kuyk: Most
of our engagement has been around the terms of trade, the tariff
issues. We have raised the point about the ability of the processing
sector to adapt to changes in supply, but we have not got into talking about how Government
might or might not. Some of that is a commercial business response.
The infrastructure is arguably something that is more public sector
oriented, but how a business changes its business model to deal with a
different supply situation is more of a commercial matter, although there are issues around skills and training, which might be a more general thing.
Mark Simmonds: The ports are private sector commercial entities as well.
Chair:
Good point. Gentlemen, that was an excellent evidence session and that will be very much
part of our evidence that we will put forward in our report. Thank you
very much. We now have two minutes before PMQs. Thank you very much.
