Director general Anthony D Cox told delegates that: ‘At last year’s AGM, we were all acutely concerned with the effects of the serious outbreak of foot and mouth disease in the UK. After my return from Hong Kong, the British association’s offices continued to be inundated with telephone enquiries relating to (a) no abattoir through-put for weeks; (b) the effects of the loss of the UK’s FMD-free status; (c) the spread of cases of FMD to Europe and elsewhere and (d) export restrictions and/or special requirements to overcome export documentation difficulties. ‘These required government re-negotiation at national and international levels. Not an easy year!

‘By September, the UK saw the last reported case of a total of 2,030 cases. In that same month France, Ireland, the Republic of Korea and the Netherlands regained their FMD-free status (without vaccination) from the OIE International Committee.

‘However, it was not until January, this year, that Britain’s FMD-free status (without vaccination) was officially restored. FMD, by then, had also spread to countries in south America and the African continent.

‘So what was the price to the UK? Altogether, some nine million animals were slaughtered at a total cost to the tax payer of around £2.5 billion. But not one penny was paid to our trade for loss of livelihood!

‘The British government stands accused of ‘draconian’ measures bordering on the illegal. The public says ‘draconian measures’ because, in the end, only 0.03% of the animal population had tested positive for FMD. They speak about ‘illegality’ because the government did not, in fact, have the legislative power to demand such mandatory slaughter.

‘The government is presently endeavouring to pass legislation to redress this anomaly against any future requirement to implement the same practices. Until serologists can distinguish between FMD infected animals and FMD vaccinated animals, there is no alternative to slaughter for the UK.

‘The industry is divided into two camps – users of the International Contract and non-users of the International Contract. Despite efforts being made to ‘harmonise’ international trade by the European Union and WTO, it is far harder to ‘harmonise’ cultural attitudes and, in particular, within our trade, wider cultural attitudes to the ICHSLTA International Contract.

‘In years gone by, this industry was, to a very large extent, controlled by the big trading houses. I would like to emphasise that whether you approved of their monopolistic trading methods is not my point. What is my point is that they brought stability and solidarity to international trading.

‘Like the Stock Exchange, their code of conduct was ‘my word is my bond’. That practice was a guarantee of integrity. They traded with a contract and respected the terms of that International Contract despite fluctuations in the markets.

‘The rationale was quite obvious – losing out on a falling market you gained on a rising market – swings and roundabouts. As a result, everyone knew where they stood.

‘But in today’s expanding new international markets, people with insufficient experience want to, shall I say, play both ends against the middle. It is seen as being quite clever.

‘Such people don’t wish to be bound by a contract or respect normal commercial etiquette. However, we would wish them to know that, as an industry, we do know who they are.

‘Many companies are lobbying us to create ‘black lists’ of repeated offenders. So far, this idea has been rejected because of international legality problems. But there are some organisations who have overcome these. We may, in the end, be forced to try and emulate them.

‘In China, the CLIA is working hard to promote the use of the ICHSLTA International Contract. However, all too often, their work is frustrated. Some years ago, Peter Caldwell of the Hong Kong Arbitration Centre stood in this room and gave us this warning. In the Orient, a contract is frequently seen only as a sign of good will between the contracting parties and not binding upon them.

‘In our trade, this practice is unsustainable in the long run – ultimately both buyers and sellers have to stay in business to do business.

‘The ICT are supporting proposals for a new contract put forward by one of their own members. However, the bulk of support for this new contract appears to come from national non-users of the original official International Contract. The value of such support must, therefore, be limited. Meanwhile, our own members have stood firm in their resolve to withstand efforts to induce them to use it.

‘Looking ahead, I believe the future enlargement of the European Union is something we shall have to watch carefully because of its effects upon our industry. The numbers are set to increase to 26 members but, already, the Centre for European Policy Studies in Brussels is working on a future framework of 50 members.

‘Further integration will undoubtedly affect the whole region’s agricultural policies. Currently, New Zealand is an EU case study for the way in which it scrapped subsidies in 1984. Reduction of CAP (Common Agricultural Policy) subsidies would greatly affect France – the largest recipient. In turn, the supply of European hides and skins may well be affected.