Ffeyddwch yn fawr, a fawr i'ch fawr i'i ddweud cyfraith yma o gywrch gyfraith ym Mhwng Cymru, yn 2024. Felly, rwy'n gweithio'n gweithio'n gweithio'r cyfrifion ym Mhwng Chwmwr Donal Cameron mewn geirionedd gennym i'r cyfrifion cymaint o'r cyfrifion i'r fanddol yn Ysgolwyd Cymru – ond byddwn i'ch gweithio'n gweithio'r cyfrifion i'r cyfrifion i'r ysgol i sicrhau ei wneud hynny, ac byw bementai'r bwyllfa gyd yn y llyfrhwyno.  We were joined this morning by Ed Barker, head of policy and external affairs agricultural industries federation, Johnnie Hall, director of policy at NFU Scotland, and Sarah Miller, chief executive of quality meat Scotland. I warm welcome to you all, and I thank you for your submissions to the committee prior to this session. I would like to start with a very general question. You have highlighted specific issues in your submissions around SPAs and logistics, but if you could just give us a brief overview of what you think the biggest challenges are and if you could maybe start with Mr Hall. Thank you very much, convener. I think that in terms of the TCA, clearly as an organisation, if we go back a wee bit further than the TCA itself, we were very clear in our opinion that actually the UK's departure from the EU was going to present some significant challenges for Scottish agriculture and the agri-food sector. Many of those challenges were unknown, but we felt that there would be challenges and issues. I guess without wanting to go over history in too much detail, the whole process from 2016 to 2021 was fraught with political uncertainties and therefore practical uncertainties in terms of what the implications would be of the withdrawal and what would the TCA actually look like. Back at the time, there was lots of discussion and debate about what sort of model would be best for the UK and Scotland, but particularly for Scottish agriculture and the agri-food sector. Having watched the sort of machinations, if that's the right word, around not only the withdrawal act but then the development and the negotiation, if you like, around the TCA, what we were very clear about is what we wanted, something that was tariff-free and indeed quota-free in terms of the trade issues, but we were also very mindful of the fact that whatever came out of this would not be friction-free. I think ever since then getting to the real point I would make is the fact that the TCA has not afforded us the same trading relationship that we had with the EU as we had before when we were a member state, so the headline might be tariff-free, quota-free, but it's certainly not friction-free and that has caused challenges and issues, which I'm sure we'll go on to explore and think about, but that has caused challenges and issues in various ways and I probably won't go into any of those details right now, but fundamentally that's been the big issue. Having said all that, what I would also have to say is that other geopolitical events and domestic challenges probably meant that the TCA and the consequences of the TCA have not been as high on the agenda of priorities for NFU Scotland and Scottish agriculture as it might have been otherwise the case because of other circumstances over the last four or five years. Thank you Mr Barker. Thank you convener. I would say that the vast majority of the work that we're doing at the moment is EU exit related. When we had EU exit and as Johnny said to start with, the initial issue was the shock of what it meant for UK but said Scottish agencies, government personnel, what it meant for importing and exporting goods and initially it was just trying to muddle through a way of working that out. Now that we're four or five years on from that process, I would say what we're really experiencing now is the pulling apart of divergence and we're really starting to feel that at the moment. So from AIC businesses perspective, which are pre-farm supply chain but also post-farm supply chain in the case of grain merchants, is that all these businesses are having to work out themselves with the likes of ourselves and other trade bodies as to what this divergence means because we're effectively having to try and work that way through. So whether that's a divergence in policy, for example we're diverging in areas such as precision breeding in England, which I know creates internal market challenges as well, but also carbon border adjustment mechanism, farm policies, support, these are all now starting to pull through. Deforestation is another really interesting legislative area because we have to work out what that means for moving goods in both directions. The other side is the technical standards of divergence, so all the time there are individual products, herbicides, animal feeds, regulated products that are either facing a withdrawal or an end to their licence and these are small misalignments that are happening all the time and they can be really niche and specific for a herbicide on oats, for example, that suddenly has been withdrawn in the EU but is maintained in GB and we have to try and keep up with that every single time. Minimum residue limits, maximum residue limits, all these issues as well and they're happening across all sectors and these tiny little technical standards are ones that we're just finding. We've had so many examples of it, so at the moment it's that divergence that's really taking up the majority of our time and it's almost the next stage, so from an ARC perspective, as you can probably gather, it's probably what we're dealing with more than anything at the moment. Good morning. I think the way I would frame it from the red meat supply chain is that it's added cost and it's added risk. The big change for us is that instead of now just the European market was treated in the same way as the domestic UK market, you used to be able to access those markets freely. Every time a product crosses into the European community now, it now needs to be signed off by a vet with export health certificates and that comes at a significant cost to business at the same time that the labour challenge around recruiting vets into the UK and into Scotland in particular means that we don't have enough vets to do that and that adds risk. From a business perspective, it now means that the European market can't just be treated as it could before and there now needs to be a considerable amount of business risk capital built into accessing that market. For smaller business in particular, so the red meat supply chain in Scotland, we specialise in high value premium products, but that means that we're not always trading large volumes. A lot of those high value but low volume consignments, basically there's no way to get them and a cost effective way into Europe now, so it has locked some businesses out of the European market. Larger businesses have been able to consolidate, so some of the processors who have multiple sites across the UK can do their own groupage and do their own consolidation, so they have been able to maintain market access. In terms of the broad picture, our exports to the EU have recovered from the initial dip that we had, I think within 4 per cent on beef and within about half a per cent for lamb, but the balance of what we are trading has changed. A bit like Ed, there's one specific challenge that we have with meat preparations and minces, those sausages and mince products. We can't export those at all into the EU, so there has been a change in how some of our exporters have to manage those products to try to make sure that they can still service the contracts that they have. I think that a really broad level has added a significant cost barrier, which alongside other increasing on-costs over the last four years, it creates a really challenging business environment for particular processors and manufacturers. Thank you very much for those opening statements. I'm going to invite Ms Forbes to come in to say thanks. Brilliant, thank you and good morning. In the written evidence and in some of the comments this morning, you've obviously outlined where there have been either non-tariff barriers or other challenges. I think that QMS has said that the change in rules around exported processed meats to the EU market has meant that Scottish suppliers are no longer able to export fresh mince and meat preparations such as sausages to the EU. My question is, to what extent have those impacts changed what the agriculture sector in Scotland is focused on? Have you seen a significant shift in the mix of agricultural produce that farmers and so on are focused on? Have you seen any impact on the domestic market, in other words the agriculture sector, trying to create more of a market here in Scotland to avoid having to export? The red meat sector is almost unique in how it is a manufacturer. We're the exact opposite of a car manufacturer, so we start with whole carcasses and the trick to maximising the value of that whole carcass is splitting it into as many pieces as possible and getting the right market for each of those individual products. The challenge with EU exit and that change of product balance that is taken then affects that carcass balance element. In terms of what impact it has had on producers, it has probably been limited to a degree but it has put additional cost and complexity at processor level, who have had to work to rebalance the carcass into different markets. The meat preparations and the sausage market is the easiest way to do it. Those products would tend to be traded more widely because they represent a larger part of the carcass. What you're seeing is bone-in whole sides or whole parts of the beef carcass being traded into Europe and then minced over there effectively. It's a realignment of the supply chain rather than having a change of what's happening at farm level, if that makes sense, and that cost has been borne by the post-farm gate supply chain in our case. Just to complement Sarah's comments then, in many ways, if we're looking at the agricultural profile of Scotland and what we produce pre-Brexit, pre-TCA and what we're doing now, I think there's very little change at farm level that hasn't really, materially changed what Scottish agriculture does and there are different reasons and causes for that. The profile of Scottish agriculture is largely determined by the topography, the weather and domestic agricultural support more than our trading arrangements with the EU. Nevertheless, pre-TCA, we were all very, very mindful that it might have significant impacts on certain sectors and particularly certain sectors of importance to Scottish agriculture. At one point we were all thinking that the sheep meat sector, particularly production of lamb and exports of lamb, would be decimated and we were all planning for that in many ways, but actually that hasn't transpired because of other market forces and issues. In terms of the question about how it had an impact directly on what farmers are doing, largely not, but I do still think that there are some sectors of Scottish agriculture that are still struggling because of particularly the lack of movement of people and the labour issues and therefore I'm talking particularly about soft fruit and veg production. Extremely high value crops, very important to the total output of Scottish agriculture. Approximately one per cent of Scotland's land mass is used for fruit and veg, soft fruit and veg, but yet it's about 16 per cent of total output from agriculture, but it's so critical and reliant on seasonal workers in particular and we know there have been challenges and issues around that particular issue for those producers and that then is arguably you know forcing their hand to a degree about what else they might do and it would be relatively easy with uncertainty around movement of people simply to stop producing that high value fruit and veg and grow grain instead for example. So there are some inherent risks that we're aware of and that's just on kind of on this side of the farm gate there are other challenges and issues around beyond the farm gate for the for the processing sector and into the whole supply chain around the movement of people as well and I think that's something that I'm sure we'll go on to discuss this morning. Thanks. Just to finish off on that we have seen challenges particularly in the in the cereal sector where there was a big opportunity five six years ago for more growers to look at break crops so we're quite reliant in Scotland but also the wider UK on on two crops wheat and barley and really at the moment what the supply chain would like to see is having more diverse cropping rotation it's good for soil it's great for farm management but at the moment that with a number of market based issues obviously there have been a push towards those two crops however EU exit has definitely made growing what we call minor use crops or break crops a lot more difficult so oil seeds pulses for example which obviously have a huge benefit with soil as well and there's a growing market for them because of EU exit we have to register our chemicals separately in GB under the GB reach regime seed costs have gone up of importing high quality seed we need to export that seed as well with a two-way flow of trade and so trying to move into other crops that are disproportionately more expensive to bring into to the wider ones GB because of their cost as when it's a smaller sector it's more expensive for the wider agribusiness sector to support it and that's what we're finding all the time oats is another good example of course hugely significant with with the Scottish economy so we also know that a number of seed businesses in Scotland as well aren't offering contracts to individual farmers just because they're worried about being able to find a market for it in the EU if they can't complete those orders in GB for example so I would say there's been a probably a consolidation towards two crops when really we're trying to do all we can to diversify that for a number of reasons and if I could just ask one follow-up question it's do you see any positive changes happening in terms of if it's the the non-tariff barriers are they becoming smoother do you see any hope on the horizon of issues around costs reducing and the controversial question which I asked to some others that were giving evidence do you have confidence that decision makers are going to be more inclined to make changes because of what the sector are saying or will it just boil down to straight up politics to take the first question I would say that things have improved but that's largely as a result of the attitude of businesses to try and resolve the problems that they've been faced with I'm always amazed by AIC members how they can work through an issue especially when it's been presented to them for the first time a number of businesses in Scotland are quite export orientated animal feeds is one area in particular high value small volume of animal feeds particularly if they're composite products you know being able to work through with other EU member states their their their versions of fss or sasa being able to work with them and have that dialogue has helped individual businesses who in turn have helped the wider sector just by being the first to undertake the legwork and and work through the certification there's still our fundamental challenges of course as for the second point in confidence it inherently is political whenever we're having discussions at an operational level with civil servants or agency staff they understand it but I think there's such a lack of resource as well that's necessary given we're effectively replicating a lot of the functions of what was once the European Commission and its agencies that there's a focus on just doing what can be done now in in the here and now rather than taking a step back and looking at the wider picture of how can we really put something across all sectors all agencies work together and actually come up with a fundamental approach which is why we would really support a veterinary agreement with the EU to be prioritised as a matter of priority. I think if I could just just add in terms of the direct implications of the TCA on individual agricultural businesses I don't think that is of significance at this moment it is it is more in in the space of where AICR and QMS are and others but nevertheless just picking up a point that Ed made in his initial comments about regulatory divergence that has always given me cause for concern and that does become slightly political if I may without being political because clearly as the UK withdraws or has withdrawn from the EU and we are starting to see some of the examples that Ed referred to of regulatory divergence from the EU within Scotland and the Scottish Government's commitment to remain aligned where possible to the EU and keeping pace with change within the EU that has started to expose some tensions and pressures not necessarily about trade between Scotland and or the UK and the EU but actually issues within the UK internal market as well and I'm very mindful about what that might look like if we start to get any sort of significant divergence of regulation or indeed agricultural support within the UK given that we've got the UK internal market act and its provisions around non-discrimination and mutual recognition etc so I'm conscious about where that might place Scottish agricultural businesses in the internal market as much as anything to do with the the arrangements we have in terms of trade with the EU or indeed the impact of free trade agreements with non-EU countries as well which obviously comes into the equation at some point as well. From our business's perspective have things improved I mean on day zero we were talking about embedding a whole set of new processes and approach to dealing with a significant part of the market so things could only improve really from where we were on day zero however you know even in the last nine months I still know of there was one over one weekend two lorries held up in parts of France at a checkpoint which meant there was about a quarter of a million pounds worth of stock that had to be written off because we are talking about a kind of a product that is a fresh product it's not easy to store particularly with meat it needs to be held at certain temperatures so at any point that that is challenged you know you're talking about quite large volumes and quite large values of products which then you know going back to that risk that the then puts on the business of accessing that market so I would say yeah things have got better but they're not totally resolved and I think the one thing that as Ed's already mentioned you know the veterinary agreement so at the moment at least 15% of shipments have to be checked that that's the EU baseline to give an example the EU has a veterinary agreement with New Zealand which means only 2% of their imports are checked and then it reduces down to 1% even with the new bordered target operating model we're not going to get down to that 2% but that that is certainly something that would help our businesses if we could be moving towards that 2% level that a veterinary agreement would give in terms of reducing cost and you know reducing the risk I think that that's definitely something that that we would see as being favourable. I'm going to bring in Mr Ruskell and then I'll come to Mr Stewart. Yeah thanks very much just a couple of follow-ups then to Geredd and Sarah you're talking there about the you know the need for a veterinary agreement I was wondering in whether you think we're quite far away from striking a veterinary agreement or given the fact that there are already far models there and you mentioned New Zealand and Switzerland whether you know it's a relatively short leap to securing an agreement which could really help the sector. Sorry I should declare that I'm an honorary associate member of British Veterinary Association as well. My take on that is and I suppose it's twofold because part of the other challenge of this is that up until now goods coming into the UK haven't been subject to any level of checker inspection so that's created a very unequal operating environment for businesses. So the border target operating model whilst it will give a level of checks for imports coming in it probably then means that there's less of a what's the right word less of a will less of a need in some people's eyes to then look at a veterinary agreement because you see the border target operating model of offering part of that and I say it will reduce it from the 15% that it's currently there but it's still a long way off where we would like to be at the kind of 2% level that some of our competitors are afforded and I think that comes down to that what is the things that we can do to help reduce the risk and reduce the cost to businesses and that's certainly where we would like to see things without increasing risk to consumers because ultimately that is why these checks and balances are in there they're in there to protect consumers and this is about striking that balance and creating an equal trading environment for our businesses here in Scotland. So do you think there's a point where the border target operating model needs to be sort of bedded in and assessed before the argument then might switch towards you know whether there's a need for a agreement on what that would look like? I think having the border target operating model will help even the playing field in terms of imports coming in but I don't think we should rely on it to rely on levelling up the playing field for the exporting piece. Though as well that obviously the border target operating model is much delayed and way overdue in that sense and as Sarah referred to for a number of years now we've dealt with an asymmetric situation in terms of imports from the EU versus exports to the EU and that should have been addressed a long time ago really and it's still going to take some time to bed in if that's the right expression I'm not sure to make sure that we have that equity in terms of flow of goods and services. A potential conclusion to that bedding in ahead of the TCA agreement being fully revised so I'm just trying to work out where this sits within the agenda of that negotiation and whether there'll be certainty as to what an appropriate model is and evidence about that up. It's very difficult to predict how long that process would take until you really think that yes that this is working to best effect for all interested parties so it's very difficult to put a time frame on that and if you then any moves to review and revise the TCA would that be based on what would remain a very fluid situation or an imperfect situation I don't know it's difficult to predict but we are moving in the right direction as I say I think we've all been calling for this to be put in place but we're still not there yet it's still not fully implemented and there's still a standout issues that Sarah has referred to so yeah the more work we can do in this respect the better and I think we've still got questions around resources as well in terms of what resources are put into the the border target operating model and alongside that what sort of resources do we have in terms of the border UK border force as well because clearly from a biosecurity point of view in all sorts of ways illegal imports if that's the right expression remain a significant concern now that's one thing to do the right checks and appropriate checks on on legitimate consignments but it's it's other things that may or may not be coming into the to the UK as well and there's some serious risk around things like african swine fever through illegal imports of pork products from wherever it might be and that remains a significant concern for for all of us okay it's probably worth adding that the target operating model is designed to be putting in the same approach to all third countries so the EU north america all treated as the same which is I suppose an understandable principle if you are to be outside of the EU however given as Johnny says how long it's taken to phase it in across different products you know the number of delays that we've had I mean I lost count I think we're up to five or six how many iterations of operating models that we had with so many different product types import destination types locations the guidance has to keep being reissued revised and also a lot of the operators at points of imports such as border control posts are private entities and so the guidance has to keep evolving so even though we might have further you know likely to have further checks later this year there is a constant flow of information and questions between industry between other organisations in fresh produce in pet food all these other organisations that represent businesses particularly that have phytosanitary and health certification requirements it's just an ongoing process because we're trying to start something very very new that we've we've sort of introduced in a really piecemeal fashion so to go back to your first question about a veterinary agreement I would say that that needs to start as soon as possible anyway nothing moves through the EU at pace understandable you know veterinary agreements are very serious thing to try and organise and to try and negotiate and when we look at other countries that have negotiated one Switzerland for example has a number of mini agreements New Zealand is another we have to begin that discussion straight away from first principles because it's having a discussion and having an agreement like that will not happen quickly and I think it is still possible to have your own operating model to the rest of the world but still have a separate veterinary agreement with the EU which is our biggest trading customer from an agricultural goods perspective the two can be can work side by side okay thanks for that I've got other questions but I can come back after alexander okay Alexander the you know you thank you very much Cymru and thank you you've outlined the challenges uh that you all face uh and the realisation of where you are now from where you were or where you might have been because there was a huge speculation at the beginning as to where we would go and what would happen but the resilience of your organisations has been tremendous as to how you've managed that potential crisis and averted some of the other crises that may well have happened during the process and and where you find yourself today is my feeling from you today is that we're in a slightly better place than we could have been but we're still nowhere near where we want to be and it's trying to balance that as to where you are and you know when we talk about the qms it was talked about some of the larger organisations were more resilient they had managed to do that smaller ones were captured in the in the crossfire of it all and and how has that now started to materialise have we lost the small people completely have they have they managed to survive or have they been taken over by other organisations to take that forward say that because that would be quite useful to see how that sector and then when we talk about the farming mr hill you've you know you we talked about potential decimation and we know that the soft fruit and vegetables is a major issue as to where you go for the future and what kind of asks and what kind of needs are still required there to ensure that that does continue to make some in road and thrive for the future because that's what we all want to see we don't want to hear that they're not being processed they're not being picked and all the rest we need to find solutions to some of these problems so that would be quite good to get a flavour from you both on that thank you yep so far take the first question first so we have businesses who are no longer exporting to the eu and have removed themselves from that market and have had to then look at new distribution routes in the UK for that product that was previously going to you know i'm talking the highest value of kind of Michelin starred restaurants you know that they were looking for that prime scotch beef fillet that we know is in high demand overseas and so they have had to look at other markets and because of where as johnny alluded to there's that wider geopolitical movements that we've seen in the intervening years so we are short of beef globally actually never mind just in the UK which has meant that those markets at the moment are there but what that will do in the long term is that that's effectively you know removed a level of resilience from that business and so i think it's something that you know we wouldn't like to see but at the moment they have a solution to a degree the big the big challenge as we alluded to on the kind of planning for day zero on eu exit back in 2019 it was all about the lamb market and we are a net exporter of lamb to the EU and almost every year since we have came out of the EU we have had sort of record trade for the sheep sector particularly this year but again that has been driven by wider geopolitical movements and you know particularly just now where a reduced lamb crop in the last 12 months Europe has also seen a reduced lamb crop so lamb meat is in demand so we've been able to increase our whole carcass exports in terms of volume into the EU that would have happened anyway if that makes sense and so i think that's a sort of set of circumstances that we hadn't had that because of that wider geopolitical movement has occurred and I suppose it's that old saying you know events dear boy events and you know there are the challenges of EU exit and there is friction in and there is cost but there is also demand for that market as well and that's not to say that in a different set of circumstances things might not have been as they are just now. I think from a from an agricultural point of view certainly what Scottish agriculture has exhibited time and time again over decades is an extraordinary resilience and adaptability in the face of different challenges economic environmental political whatever they might be and it's difficult to separate out what the implications are of of where we are in terms of the tca and whether it operates effectively or not is it is it better than it could have been in all those sort of hypothetical questions from lots of other things that we know are having a significant impact on Scottish agriculture not not least of the the the big rise and input costs of it witnessed over the last two years global forces in many ways plus clearly a changing environment in which we operate in terms of our climate and to a degree significant uncertainty around future support what replaces the common agricultural policy and how does that bed in and so on but nevertheless I remain very confident that Scottish agriculture will adapt and will will ultimately thrive in whatever situation it presents itself and in many ways my plea to policy makers and decision takers in some ways is that we quite actually we need to focus on what we do and what we do really well and do that to the best of our ability and think also about our domestic markets and by domestic market I mean the UK market as much as anything else and how do we make the most of that as well as other export opportunities so our trading relationship with the EU is not the be all and end all of everything and and and it's therefore yes it's it's an important issue I'm not trying to dismiss it in any way shape or form but there are so many other things that that will influence our agri food sector in Scotland that we need to be mindful of what those other influences are in whenever we're looking at whether the TCA could be improved or changed or whatever it might be and you talked about you know the friction that has occurred and I think there has continued to be friction within the sector and there's even been like a call to arms within the agricultural sector to stand up and and shout the case and you know there's been demonstrations there's been protest there's been all of that has has created or has put the sector into a slightly different vein of of managing and trying to engage with the policy holders or the decision makers themselves and I and I say I think that's been challenging for you but you know you've also wanted to be heard and I think it's important that you are yes you know there's absolutely no doubt that farmers and crofters across Scotland as indeed the rest of the UK are feeling threatened to some degree but I would put much of that threatened pressure or very little of that pressure down to things like the TCA I think there are lots of other other issues that are driving those concerns and things that I think we can we can address with the right engagement at the political level with industry and so on and we are doing that to a large extent and how well our supply chains function internally and make sure there's equity in those supply chains and so on. I think it's a great opportunity actually in Scotland through things like we now have the good food nation act we haven't we've got forthcoming legislation around the agriculture and rural communities bill around how agriculture will be supported and enabled to deliver high quality food production alongside delivering on climate and biodiversity and so on so getting those things to align I think is going to be far more important to the future prosperity of Scottish agriculture and indeed the agri food sector which is so important to to Scotland's future rather than just you know things that could or could not be improved with the TCA. Like I say I'm not trying to dismiss the importance of the TCA but there are so many other things as well which which we need to take into account it's very difficult to say if we sorted the TCA or everything else would be okay far from it. Just to supplement it as well I think it's a really important point that Johnny's made because essentially what EU exit did alongside your triggering the TCA is there's a whole raft of legislatory and regulatory change that if you're a business you know the centre of that it's not just about how you trade it's about how you do business and I think that rate of change during some of the the kind of geopolitical movements that we've had since 2020 you know COVID cost-loving or you know all of those things have made it a really difficult business environment just now and you know that that certainty that we now look back on you know in 2019 you know who would have ever thought we thought that looked certain but it did but it compared to where businesses are just now and I think we have to be mindful of that if you're running a business at the moment with that with that risk profile you do look to de-risk wherever you can absolutely. I used the word there that that lack of certainty or the degree of uncertainty and I that is something that really is running right through agriculture and and so and I guess you know I can't stress enough that that's probably the bigger driver for individuals thinking about what do I do next absolutely in that sense so yeah uncertainty is is not good for business in any sense and I think obviously EU departure and the TCA and various other things around that has exacerbated that over recent times and we need to get to a place where we're we're dealing with in a more certain environment things have never completely certain I totally accept that and it's ironic in a way that in some ways that we bemoaned the EU and everything it gave us through the CAP and the bureaucracy and regulation but it gave us absolutely certainty in many ways we knew what we were working within the parameters and we we got on with it but now actually it's a it's quite a brave new world where we have to do an awful lot of thinking ourselves and that that's quite challenging in some ways. Thank you. Thank you and apologies for being late convener and apologies to the panel as well but even listen to that part which I have done it seems to me to be disastrous to be honest I mean hearing about continual kind of issuing of guidance and regulation a very hard environment to work in I just to stick with the EU departure and the TCA first of all and it's two points that I have one is you mentioned in your response that the lack of any kind of form of monitoring of divergence by the UK government was a crucial thing and this committee tries to carry out that monitoring the Scottish government is committed to doing that are those commitments kind of irrelevant is it has to be the UK because of the relationship with the EU that that monitoring has to take place and the second point really is on the the point that we made about uncertainty I think most people never saw Brexit coming not far in advance anyway and I would predict that most people won't see what would happen next and it may be things you can change very quickly say for example we went back into the single market would that change the fund it would be a further change of course which would be very disruptive but would that change eliminate some of the problems that you're currently seeing or does it require full EU membership to affect that change so two questions one has to the value to your organisations of the committee and the Scottish government monitoring divergence and I think trying to limit in the part of the Scottish government divergence or does it really have to be the UK monitoring that and the second point is about what the effect of going into the single market might be I'd say the monitoring work is really valuable and that shouldn't be underestimated at all whether that's grand you know large policy issues that are emerging between the EU and Scotland for example and also with a more maybe a more detailed level in terms of specific standards that are being introduced if the EU withdraws a key substance product for example you know we have to keep track of that as well and the work that's taken place I know within the likes of Sassar and an FSS as well has been very valuable Johnny touched a really important point which is also the internal market of of the UK Northern Ireland we haven't mentioned yet it's a huge part of a lot of certainly ARC Scotland members export business that's been curtailed massively particularly in animal feeds for example seed as well and what we have to try and also do is looking at EU Scotland EU UK is the internal market on top of that and divergence and I would say that probably is a whitehall origin because that's where the the ongoing work has to take place the vast majority if not all ARC Scotland member businesses are almost certainly trading within other parts of the UK that's the reality a lot are you know inevitably have other offices around the UK all simply be buying from English farmers or they'll be buying from Scottish farmers and selling into England where there's a market particularly in in seed for example and so that monitoring work is for us is at least the starting point because at the moment we haven't measured anything we have no idea as to the total divergence that's taking place it's us in business that are having to do that and the lights as you know Scottish work in Scotland sorry that's looking at divergence is very welcome but it's limited only obviously to a part of ARC business more broadly and it's very piecemeal there are other projects taking place elsewhere Northern Ireland has been doing some work as well there are some parts of the FSA in England that are doing that work but it's you know it's fine for certain products and scope but for whole other parts of the economy it's just lacking completely and so it does need to be coordinated and that's that's the very starting point we we need in terms of moving towards a single market or anything like that obviously these are very political discussions clearly the single market does make it easy to trade goods but as we said before a veterinary agreement is probably the best way to start that process almost to to platform that if you like as a lead-in just because we shouldn't underestimate the divergence impact of the last five four five years it would I think take quite a considerable amount of time to converge if you like from where we've been because that divergence has either been willful by the UK government or it's been passive where the EU is carried on regulating which is understandable and we haven't done anything either within Scotland or the UK purely because we haven't had that mandate to do so if I can actually speak here excuse me my apologies I'd agree with Ed monitoring of convergence convergence divergence is absolutely critical whether that takes place through the Scottish government and this parliament or it's a white hall function I'm not really sure of any greater advantage or disadvantage but probably at UK level needs to be done first and foremost excuse me it is critical to understand what the implications are my other point though is about if Scotland were to and it is somewhat political I appreciate that way to return to the EU and enter the single market again I think it would be a very different single market partly because it's not a matter of when sorry if but when oh thank you very much is that declarable it's not not a matter of matter of if but more when the likes of the Ukraine and Moldova um become member states of the EU and that in many ways will change the agri food dynamic of the EU in single market as well so I'm not saying in a bad way but I just think the context will change significantly so can I just quickly ask is there any point of divergence that as Mr Marker said you will be most aware of more than governments and anybody else when you've noticed a point of divergence is there any point of divergence which you made representations to the Scottish Government on which they they would be able to address or I mean I appreciate first of all the breadth of it it's huge and if you do nothing at all you're diverging because of the reasons you mentioned but is there any obvious point of divergence which has caused you concern which may be within the gift of the Scottish Government to address and that you made representations on at the moment there are times when we will talk to the Scottish Government specifically fish feed is a really good example we have a 600 million pound fish feed sector predominantly based in Scotland and so that you know where we've got sectors that are particularly concentrated in in Scotland clearly our representations through the Scottish Government are a lot more impactful that's the same for certain grass seed sectors forage sectors as well the Scottish Government have been really supportive and very helpful particularly FSS and others of working with us and identifying very specific product sectors but for the whole general range of products that are say across the livestock sectors and fish sectors you know we have to be very specific because ultimately the agencies within Scotland are resource limited to be able to deal with the volume of work so we have to be very targeted within that as Sarah said we have limited veterinary capability that has impacted on fish feed exports from Scotland to EU and Scandinavia and that's just it's a resourcing issue and we can't get it we can't move past that so on an information sharing basis it is very valuable but when it comes to that representation to either the European Commission or individual EU member states obviously it's Westminster is a sovereign representative of the UK that can make those representations either through the TCA which I would argue isn't really functioning in that approach on SPS issues it's often on a bilateral basis between individual member states but given how long it takes we just either we or a member just get on with it and try and do it ourselves directly because that's how business tries to operate. I was going to bring Mark in and then we'll come back to you Kate and I was waiting to be back also. I mean I was interested in your overall views about a direction of policy within the European Union at the moment and there's what I'm hearing is that you know where there's divergence that obviously causes friction in terms of trade it causes issues of borders and different standards but in terms of the decisions that are being made in Europe at the moment around regulatory standards whether you feel that's moving in the right direction for your sectors or whether you feel you know there's a policy divergence there and I suppose I would I would just erase one one example of that where I know that beekeepers across Europe and across the UK are being concerned about adulterated honey supplies coming into both the UK and Europe and have called for country of origin labelling in relation to honey and that's something that the European Union has moved quite quickly on through the honey directive but are also looking at other issues connected with the breakfast directives around import but there doesn't seem to be an appetite from DEFRA to actually move towards introducing that kind of regulatory standard so that that for me felt like one quite niche kind of example but I'm wondering what your kind of overall thoughts are on that and I should declare an interest for second time convener that I am actually a beekeeper but I don't produce honey in any kind of volume for export but it's one issue that's been raised for me where the European Union's taking a stand and it's moving regulation forward. It's a time and resourcing issue certainly within within DEFRA and Westminster I'm afraid the commission obviously is covering multiple different sectors all at the same time we as AIC we sit on three European associations we're a member of three European associations I sit on the board of one of them and the constant volume of new regulated product regulated issues coming through whether that's on policy like farm to fork and the east green deal or very niche specific sectors like honey for example an interesting example is where we're looking at new technologies coming so what we call novel regulated products on novel foods so these are things like you know use of insects for example in in animal feeds as an example regulated products can be cannabinoid products as well you are regulating on these because they have EFSA and they have the resources to do that what we're finding within DEFRA and then by extension FSA and FSS is that there just isn't the time available to be able to put all these new applications through the system and whilst FSS could regulate themselves it doesn't really go that far because you're just then leaving Scotland to be able to use certain products or regulate in certain areas and not the rest of the UK so businesses like ours they see that as a very small market to be able to operate in obviously respecting the UK internal markets act so it's it really comes back to I think an issue of prioritisation and what are the immediate issues now that need to be resolved and for the aspirational forward-looking regulatory policies that's just simply joining the back of a very long queue I think we worked out that the current rate of applications through the FSA I think it's about 18 years at the current rate of applications to get a regulated product through so that gives you an indication of how. So what you're saying then that that we are getting divergenced but just because there's a lack of capacity to deal with all of those multivirus issues that exist within the food section I've raised one okay. Yes. Johnny. Yeah I would agree I mean there's a whole raft of regulations in and around agriculture the environment related to that animal health and welfare everything you possibly think of in terms of the food supply chain and I don't think there's been the capacity within in DEFRA and other departments to deal with those issues it might have been one of the reasons why again I'm probably straying into politics but the retained EU law bill in Westminster introduced two years ago was was trying to be a rapid move to almost sort of saying this is what we don't need anymore we don't need that but we'll keep this sort of thing that gave us a significant cause for concern because that was going to be a rushed job there was meant to be a sunset clause attached to that and you think hang on a minute you know you're not going to do that particular piece of work justice simply through political expediency if I can be as allowed to say that so big causes for concern there and it's also in a way somewhat frustrating when you look at things like what has happened in the space around what's happening in Europe around things like emissions trading schemes carbon border operate adjustment model things like that that in many ways that was happening and is happening and would have been relatively easy to to adapt to if required and yet we're seeing DEFRA in the UK and to degree the Scottish government having to then replicate something very very similar but maybe not quite the same so that's kind of a frustration in a way that we're almost doing an awful lot of things that Europe are doing in order to keep pace with but but it seems to be then absorbing an awful lot of resource and time and energy to do that maybe maybe I'm just being frustrated in my own capacity there string off string off track apologies if I can come in here from a slightly different angle but to build on that so one one area obviously with livestock and welfare is absolutely paramount to everything we do the health and welfare of the livestock is what results in such a high quality product that we produce in Scotland and one of the one of the challenges is a lot of the medicines that we use will come from global pharmaceutical companies previously authorisations were granted on a European basis and now we have a basically a British regulator as well but these businesses in some cases have looked at actually the size of the the British market and gone actually that adds a cost level to us that for our business it's not worthwhile us going into which then limits that kind of availability of products to our own farmers here increases prices of existing products that are left on the market there has been at times shortfalls of specific products at pinch points in the year lambing time last year for example and I think that that's an example of a sort of a different side of the coin that we haven't explored as well because that ability to produce good food is reliant on imported products coming in and non food imported products you will come in through some of ed supply chain and the the challenges that those businesses and coming in not just on getting them across the border but also kind of regulatory as well results in a kind of I'm more a bigger challenge for businesses to use them so I think that's something I just wanted to highlight there but that is that though a policy divergence or is that just the consequence of Brexit that we need different regulatory regimes I suppose the reach chemicals is an example of that where we've got a duplicate regime running alongside another one is that fundamentally any any kind of difference around the way that we're regulating and the way that we're going forward with policy between the UK or is it is it more about the fact we've got duplicate regulatory structures and friction that that is that is the issue and as you're saying a lack of capacity to then keep pace with all the things from honey production to you know fertilizers and everything else it is a duplication essentially of course we're doing things slightly differently it's we're looking at it with active substances with herbicides pesticides different withdrawal limits you know different timings in terms of when the when the renewals come up so we're slightly out of sync but ultimately we haven't you know in terms of the information and data that's used in a lot of those assessments it's fundamentally the same still you know we haven't we haven't changed completely overnight our our regulatory approach at all and the EU hasn't made a fundamental change either I think as I mean Johnny said it really well it's certainty the last few years we've been very reliant as an industry on quick fixes and patch ups for things that have just been sprung on us at short notice last year we had this issue with imported seed treatments so seed treated with a herbicide or a pesticide particularly important in the maize sector we had to as as NFU NFUS all industries had to fight as an industry to get Westminster just to extend the rules on registrations of treated seed for another two years otherwise we would have had a cliff edge from the 1st of January this year would have had a massive impact on the dairy sector and we have that with the renewable energy directive of exporting cereals into the EU for biofuels we've I mean that took the best part of six seven months of our life last year where we were trying to negotiate a fix with the EU on that market access and so these small incremental patch ups really don't help with the long term security predictability that the supply chain needs which fundamental policy differences within any of these spaces there are some but I'd say they're the minority so CBAM we may well choose as the UK to actively diverge I would argue that there has been some active divergence in precision breeding gene editing the way that EU approached their NGTs is slightly different to the way that England and Westminster has approached it deforestation is another area so imports of goods like soy or cocoa we're doing the same thing but we're implementing it differently so the the fundamental policy aspiration I don't think different it's just the the mechanisms to get there in some cases are different and that might be willful okay okay thanks Kate thanks very much I don't know if this is a directly relevant but it is in the sort of general scheme of things in terms of free trade agreements in terms of Australia and New Zealand and are there any winners in Scottish agriculture when it comes to the free trade agreements from the primary producer's point of view no in the longer term I guess given that whisky will will clearly I think benefit from that then yes you could argue that those growing malting barley for the whisky industry that provides certainty and confidence but by and large for for most sectors that will be impacted by the cumulative effects of the free trade agreements particularly Australia and New Zealand and I'm thinking particularly around red meat dairy horticulture to degree as well and grain to degree there is no win as far as we're concerned in terms of the FTAs red meat perspective I think there's two things that concerns us and Johnny's picked up on one of them which is a cumulative effect on multiple FTAs being done giving access to a large proportion of our market and the second part is something I spoke about earlier this carcass balance piece because again it's not just looking at what's coming in it's then looking at what part of the carcass that is displacing and it may well be that imports from Australia and New Zealand look to displace a lower end of the value chain so maybe not your strip lines and your fillets but because you need that whole carcass value to be maximised it actually reduces the total carcass value particularly as the FTAs haven't been done on a whole carcass basis so that what that means is that Australia and New Zealand could fill containers full of strip lines for example and send them over here and if that challenged part of our market then that that would impact our whole carcass sale if that makes sense and I think these are two really unique things that because of the way red meat supply chain works are really really important. Are there opportunities for red for scotch beef scotch lamb especially like to pork in high value markets across the world? There absolutely are but in terms of the risks that I've described today in getting those products into those markets you know accessing other parts of the world in some cases is easier than accessing the European market in some cases but there is cost associated with all of those and not just cost to business there's cost to the public purse as well you know food standard Scotland we rely on having well funded bodies to be able to carry out those functions to enable our businesses to export and I think that we've kind of touched on that today if we really want to become that kind of outward looking global trader then we need to invest in infrastructure here in Scotland as well to enable us to do that and you know our products are in demand that that's a good thing but we need to be able to get those products out into the world at a cost effective base point thanks sounds like you're all in agreement with Australian Deputy Prime Minister then who's said that the big winner was Australia full stop great thanks thanks I think it's been really helpful session this morning thank you very much for the evidence I have to say that part of my role in the committee is to attend the PPA with Europe and although there is a time set for a review of the TCA I think there's there's not a consensus on what that means means that I think there's a lot of hope in some areas and obviously the Windsor agreement opened up some areas of contention like horizon and things like that but it's one of these areas we really don't know what that review and the extent of it might be and how that might help so but thank you very much for your evidence this morning when now moving to private session thank you


Oh, okay, I gotcha. All right, baby, I see what you're trying to pull here. UNN2 was canceled, but now, all of a sudden, it's been brought back into the spotlight because you've been working on it behind the scenes. Okay, okay, well, I guess the only reasonable thing to do is analyze this trailer and see what we can come up with. Originally, there was gonna be a build release too. I'm guessing the public, though, baby never said this September, but she wanted to hold off on that and give it more extra time to walk on. So now it's been delayed to a 2020 release. Baby has released a teaser trailer for Nintendo Night Dose. So we're gonna check that out. I've already seen it, so I'm not gonna be reacting to it. I'm just gonna go very detailed analysis, frame by frame. It's gonna be a 45 minute video. It's really not much. It's only, let me check. It's only like a minute, half of it is an even new information. That's just footage of the old game. So we don't really have that much to go off of, but I'm gonna try my best to come up with a story based on the trailer itself, the description of the trailer, some posts that Baby has made on the Gamejolt and information that she has given me. Gonna use that to my advantage. Baby, keep your secrets. She's enough gonna trust me ever again. Yeah, so I'm not gonna drag out this intro any longer. We're gonna check out the trailer, see what we can come up with. So we're just going to, the beginning bit, it really isn't anything special. It's just footage of the first game. We already, we've already seen this, so not much to talk about here. You remember the first game? Of course we do. Blast, fun times. Very fun times. But now a new nightmare begins. Whoa, game footage not final. We're gonna watch through it once and then an investigation and then go back through it. Oh, shoot. Is that, who is that? I can't imagine. Is that Ribbon Ron? I don't know how to pronounce their name. New foes await. I've seen this trailer at least like three or five times. Multiple custom nights. Wow, all right. I'm already seeing things that we need to talk about. Jigglypuff, game over, I guess you're gonna make it. Don't get rested. Ultimate of Tinder night two, 2020. So like I said, the first beginning bit really isn't anything special. You remember the first game? That's basic information and then a new nightmare begins. That's just referencing a new game coming out, 2020. And then we get to the really deep stuff right here. Also, I mentioned it while we were watching it, but game footage not final, of course. So we see Ashley stuck in a chair, tied up, and she breaks free. So we've actually seen this, Ashley, in the real demo for the game. God, that was back in January. It's like, I think it might've been exactly January 2nd. So it's been a while, but yeah, we played it. We played as Ashley and we got to talk to Crash and some other characters. And we know there's an investigation going on at a fan Nintendo establishment. I don't know, it's weird. An investigation and then we got Ribbon, Dark Ribbon. I'm not entirely sure how to pronounce their name.  Next up we've got new foes await. New characters are coming, obviously. This is interesting. This really reminds me of sister locations, mini games where you have to, not the mini games, but like during the nights where you have to sneak around Funtime Auditorium and blow a gallery, just like in Help Wanted, which was terrifying. So you can see that we're moving through a room and we're trying to get to a door. There's a red carpet, checkerboard pattern, there's the door. And this, ooh, what is that saying on the drum there? The P-Jiggles, awesome. The P-Jiggles. Okay, so yeah, we're walking through a room. This is interesting. So we've already, we've already seen this, obviously, but this is some sort of performance stage. I'm not sure if this is the main stage, but yeah, I'm not entirely sure. You can see a guitar, some drums. I think that might have been like a saxophone. There's a mic there. 12 AM, so we're obviously gonna be here from 12 to six. And then as we're shining our flashlight around, the battery is slowly draining. So we gotta keep an eye on that. Yeah, oh no, what, God, what is, that's not a saxophone. It's a tuba, all right. Yeah, so we're looking around multiple custom nights. So there's gonna be multiple levels we have to play through. And then here we see a classic Five Nights at Freddy's fan game. You know, we've got the cameras, you've got more batteries, you've got two next to it. Not entirely sure what that could mean. Maybe we have like two sets of batteries and then when one goes out, we get to replace it. Not entirely sure. Let's see, how many cams are there? It looks like there's 11 cameras. Again, 12 to six. And then we're back here. And then again, this, yeah, that one makes me, makes me believe that we have two sets of batteries. Here we can see Mr. Game and Watch. I think, is that gooey? I'm not entirely sure. There's a vent here. There's two doors here. We got the whack, because why not? I'm very disappointed to see that there was no fan. Just saying, baby, I have a feeling you are going to watch this. So, yeah, very disappointed that there was no fan. Shame. All jokes aside though, this office, you can see we got the classic doors and lights. I'm guessing that's going to be on both sides. There's no light button for the vent, which is interesting. Yeah, doors, lights on the other side as well. And then we get a jump scare from Jigglypuff, which looks like it could be in, yeah, you can just barely see the, so we've run out of battery for our flashlight in the band section, and then I'm gonna try and pause it. Ah, I can't, but yeah. This is the jump scare for Jigglypuff. Very interesting. And then we get the game over screen, and it says, guess you couldn't make it. My mic's covering it. And then we got a ruby on in the back. And then, don't get rested. Not entirely sure what that could mean. Maybe we fall asleep. Or maybe it's like, don't get rested from the invest, I don't know. Awesome predictions from me. And then Ultimate Nintendo Night 2 2020. The description for the game reads, in Nintendo, Ultimate Nintendo Night 2, you can play more than one custom night. You'll be caught in many scenarios, such as a music room, a kitchen, and God forbid a generic FNAF one clone. You play as Ashley, an investigator of the Nintendo fan location, we still haven't thought of a name yet, who has a job of exposing the truth of Riveron, the location, and what lies beneath. What trouble awaits, find out in 2020. Yeah, so like I said at the beginning, we are in a fan location of Nintendo. Not entirely sure what that's going to lead to, because we're not in the actual Nintendo establishment, like Nintendo of America. We are going to be in different scenarios, like I said, a music room, a kitchen, and a just regular FNAF one clone. So the music room is the band stage. We've seen that in the trailer. The kitchen, I don't think we saw that, and then the FNAF one clone we saw quite a bit of. And I'm not entirely sure if that's all of the scenarios that we're gonna be put into. I'm guessing there is probably going to be more than just three, because three's not a whole lot, if I'm being honest. Everything I'm about to say may or may not be true, because this was said back in January, back when the demo first came out. So obviously things could change from now, from then to now, and from then to the release, and from now to the release. So not everything I'm gonna say is final, but something I can say for sure is that this game is going to be pretty, pretty, pretty story driven. We saw it in the demo, the real demo, not the one with big chungus, which I'm still upset to say that that was the first video of 2019. That's on the channel. That's pretty sad. First video was about big chungus. Yeah, in the real demo, it was pretty story driven. We were playing as Ashley. I think we found like a dead body, which was kind of creepy. We also got to talk to Crash, and I wanna say Spyro, but I honestly cannot remember. We got to talk to a few characters. Definitely Crash. I remember him being there, and they were telling us about something. I don't know. It's been a while since I played it again. It was back in January, but the video was still up. So if you wanna go check that out, I'll link it in the description. Of course, the trailer's gonna be linked down below anyways. And also the game page is gonna be linked down below. I'm pretty sure that, actually, yeah. I'm pretty sure that Nintendo Night 2 is going to have its own game show page as well. I'm pretty sure Baby said that. Baby has come up with her own story that she's gonna be trying to tell throughout this game. That's it. That's the whole trailer. That's the analysis. This really was an interesting trailer because the second game is gonna differ so much from the first game. And not only do we have quite a while to wait, again, 2020, but the good part is, Baby has said that I am getting an early copy. So thanks, Baby, for that. That's really nice. If you wanna check out the original trailer for yourself, it's linked down below. The first game's linked down below. And both the videos I did on the demo is a link down below. So thank you everyone so much for watching. Make sure you go give Baby some love because this game's coming along great. I'm super excited for it. Hopefully guys are too. And I'll see you all on the flip side. Goodbye.


We have Actional Arts Plus named Hewlett Packard Enterprise who just spoke to Meg Whitman. Yeah, you know what I mean, like Meg is now saying it's another quarter. Scott Berman and I are just kind of trying to really make a decision about whether it really will be next quarter. There's a breakout. She told us last quarter is going to be a breakout, but some of the parts are worth 21. But there are a lot of other stocks out there. You know, we always, when we're doing Actional Arts, we're always trying to make a judgment whether there's something better than what we own. We don't want to bring in a new position without kicking out a bad one. HPE is on the bubble. It's on the bubble.