Supply Chains
The Supply Chain section of the SRUC report Rural and Agricultural Development: Maximising the potential in the islands of Orkney, Shetland and Outer Hebrides can be downloaded as a stand alone document from the link below. This section draws on primary data collected from various industry sources on the islands and through SAC Consulting's local offices. A selection of the points raised in this section of the report includes:
Production activities on farms and crofts generate further economic activity and employment elsewhere. For example, purchases of goods such as fertiliser, feed and machinery or vet, haulage and mart services underpin businesses upstream in the supply chain. Equally, downstream supply-chain business such as abattoirs and creameries are also stimulated. In addition, a proportion of wages paid to staff across the supply-chain is spent locally, thereby underpinning businesses out with the agri-food supply-chain itself.- To assess the presence of agricultural and ancillary services for each of the island groupings, as well as the dependence on imported goods and services, an inventory of businesses was created. Firms were categorised by business type and relative position/role in the supply-chain: upstream services, ancillary services, and downstream services.
- As the new model of conditional agricultural support is implemented in Scotland it is anticipated that there will be a need for more support services, in the form of agricultural, veterinarian and environmental advice, knowledge exchange and training. To ensure a Just Transition, the need to future-proof on-island advisory and consultancy capacity will require investment by stakeholder organisations and the Scottish Government to ensure island farmers and crofters are fully supported, as on the mainland, in undertaking new Whole Farm Plan elements (Tier 1), and in adapting to Tier 2 conditional direct support payments.
- Unsurprisingly, the cost burden of additional transport for inputs purchased and outputs marketed are significant across the islands - but it is also important to recognise the additional costs faced by more remote farms and crofts within the islands (e.g. in Orkney's Northern Isles).
- Data on costs of haulage gathered in the project found that, for example: that Ammonia Nitrate (AN) fertiliser was £54/t more expensive in Kirkwall than the non-Highland areas of the mainland, but those on outer islands faced further additional costs of £15/t to get it delivered from Kirkwall. In Shetland outer isles, beef stock nuts were £114/t more expensive (similar to Uist and Benbecula) than in the rest of Scotland (with Lerwick £85/t more). Compared to the Rest of Scotland the average haulage costs to mart were £30 a cow more in Lewis and Harris, and £60 a cow more in the Shetland Outer Isles.
- These additional costs of undertaking agricultural activity are important to recognise in any future replacement for the Less Favoured Area Support Scheme (LFASS).
The download link to this section of the report is found below, or you can return to the main report page here.
