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Hello from London, where UK prime minister Boris Johnson has been jogging around to demonstrate his own fight against obesity as he unveils new curbs on food advertising, partly aimed at helping British consumers lose weight and become less vulnerable to coronavirus.
From excess sugar to lockdown supply chain disruptions and post-Brexit trade talks, food has never been far from our national conversation this year; as I argue in our main piece below, this should provide some measure of reassurance to farmers facing a deeply uncertain future.
Our policy watch highlights the latest phase in the weaponisation of rare earths — metallic elements that are embedded in most high-tech products — while our chart of the day is selected from our new global economic recovery tracker.
Change of tone on US deal offers hope to farming
When I speak to farmers — as I frequently do in my role at the Financial Times — they often convey a feeling that they have little political power.
“It’s always us that has to take the cut,” Maisie Long, a sheep farmer in Cumbria, told me this month. “People seem to forget that farmers make the countryside. People seem to forget that we keep everything turning over.”
She had plenty of reason to feel besieged: market disruptions thanks to Covid-19, upcoming subsidy cuts and the fear of a no-deal Brexit trade cliff edge cutting into the European market for UK lambs.
Yet farmers may not be as powerless as they sometimes feel. The fate of British agriculture has become a flashpoint as UK negotiators attempt to thrash out post-Brexit trade deals with the EU and US. And there has been a gradual but definite shift in their favour.
Farmers’ big fear is that a deal with the US will enable the import of foods made under environmental, animal welfare or food safety conditions that would be banned here, enabling overseas farmers to undercut the UK market by using methods such as risky organophosphate pesticides or “sow stalls” that all but prevent a pregnant pig from moving.
They are right to fear. High on the US list of negotiating objectives is “comprehensive market access for US agricultural goods in the UK”, including by eliminating “non-tariff barriers that discriminate against US agricultural goods”.
But a turning point occurred in late June. UK ministers conceded to farm lobby demands for a trade and agriculture commission to advise on post-Brexit strategy. This was not a mere fig leaf, trade experts told the FT: it indicated the UK would step back from seeking a quick US trade deal, which would likely have required concessions in priority areas for the Americans, including agriculture.
Farmers demonstrate with tractors outside London’s Houses of Parliament in July as they demand protection for the UK farming industry © Leon Neal/Getty
And so it proved. UK trade secretary Liz Truss said last week it would be “dangerous” to put a deadline on trade talks with the US, in a stark change of tone from earlier this year, when officials had briefed that a deal could be reached by July. It was Truss who had previously sought to put together a package including tariff liberalisation to help reach a quick agreement with the US.
Why the shift? Of course there are other issues at hand, including data transfer and tech, which my colleague Alan Beattie has written about this week. But farming has also been a factor, via a figure politicians can ill-afford to ignore: the British consumer.
When we buy our evening meal or our lunchtime sandwich, we may not scrutinise the ingredients for their ethical and phytosanitary credentials. But when asked, the UK public is emphatic that it does not wish to compromise food standards.
Like genetically modified foods, “chlorinated chicken” — which has become the accepted shorthand for lower-standard imports — is unwelcome on UK shelves. A June survey by the consumer group Which? found almost three-quarters of consumers believed that “food produced in countries with lower standards shouldn’t be available in the UK”; more than a million people have signed a farmer-led petition to this effect.
Another survey by OnePoll this month — commissioned by the admittedly self-interested National Farmers’ Union — found public support for farmers at a record high, partly thanks to increased awareness of food supply chains after the coronavirus lockdown.
A person close to the set-up of the new commission told me that making trade concessions on food standards would deal a big blow to public confidence, and that this was one reason why sacrificing UK farmers in trade talks would make little sense.
This does not mean they can stop worrying. A slower deal with the US will still have to overcome similar negotiating hurdles, even if a new president is elected this autumn. But the change of tone on a transatlantic deal offers a glimmer of hope to farmers such as Long. They may wield more clout with their own government than they think they do.
The world is slowly emerging from a pandemic that has resulted in the most severe global economic contraction since at least the 1930s.
Where lockdowns have eased and the virus is under control, economic activity is starting to recover — but because there is a lag of weeks to months between when official economic data is produced and the period of time it covers, it is out of date before it is published.
The FT will be tracking the most relevant alternative indicators to provide a first snapshot of changes in activity as they happen across key sectors and countries.
An F-35 fighter built by Lockheed Martin. Rare earths are key constituent of the plane but China accounts for 80 per cent of the global mined supply of these crucial metallic elements © Getty
When China said this month it would impose sanctions on Lockheed Martin in retaliation for a US decision to sell missiles to Taiwan, it did not elaborate on what this would entail.
But the Global Times, China’s state-owned nationalist tabloid, speculated that Beijing would probably “cut off material supply including rare earths, which are crucial to advanced weapons production”. That would mark the latest phase in the weaponisation of rare earths — a group of 17 metallic elements that are embedded in most high-tech products.
China accounts for 80 per cent of the global mined supply of rare earths and an even higher share of the manufacturing of powerful rare earth magnets, which are key constituents in everything from wind turbines to the F-35 fighter jets built by Lockheed.
The surge in US coronavirus cases is pushing the Federal Reserve closer to a delicate decision on the best way to deliver more monetary support to the US economy, but the central bank is unlikely to move imminently. Policymakers will gather for a meeting of the Federal Open Market Committee on Tuesday and Wednesday, which will be dominated by the threat to recovery posed by the spread of Covid-19, including in such economically vital states as California, Texas and Florida.
Big tech is back in the US congressional hot seat, writes Rana Foroohar. On Wednesday, the chief executives of Amazon, Apple, Facebook and Google will be questioned in a House judiciary antitrust subcommittee hearing. This is perhaps the most important and high-profile conversation about monopolies since the Microsoft case of the 1990s.
The coronavirus outbreak has shone a spotlight on the treatment of millions of foreign workers across the oil-rich Gulf. Many have lost their jobs as businesses have closed, and thousands have left. Now there are questions about how many will return and whether Gulf governments will use the crisis to improve workers’ conditions.
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The US will award $265m to Japan’s Fujifilm as part of Operation Warp Speed, the Trump administration’s effort to accelerate vaccine production to 300m doses.
Battered by protracted western sanctions, Russia has intensified efforts to sell arms to south-east Asia, looking to lift its economy and diversify diplomatic relations.
This article was first published at https://www.ft.com/content/ecca4289-f942-4ce6-9c9d-0f0825b125c2