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Clearly the olde English adage, "Nothing does good for corn markets like a wet harvest and a bloody war," has little relevance to the tragedy of September 11, even if US President Bush does talk of "war" on terrorists (680 words).

In the past markets for agricultural products have been helped by increased demand, and to a lesser extent reduced supply, resulting from major hostilities. Typically increased economic activity associated with fighting a war resulted in improved demand conditions from which farm markets benefited. To a limited extent hostilities also, directly or indirectly, adversely affect farm output in and around the areas where fighting took place and loses at sea again benefited market prices.

Once the dust clears on events in New York and Washington, it is likely to become apparent that security, in the widest sense of the word, rather than hostilities, will add to economic activity. It is also apparent already that security will dominate political agendas everywhere.

In the short term, however, having been blind sided, it may be a little time before the economic adrenalin kicks in. As economic activity in the US and generally elsewhere was slowing, so the September 11 tragedy has added to concerns of investors resulting in the very substantial decline in stock market prices around the world.

As decisions to invest in security measures are not market outlook dependent, so the prospect of uncertain economic conditions is unlikely to result in their delay. And the world economy is less likely to slip into recession than it was before September 11.

Clearly discretionary air travel and any activity related to it will suffer. But at the end of the day consumers are likely to spend elsewhere what they save from not flying. For instance what is not spent on an overseas holiday is likely to be spent on recreation at home.

Against this, however, investments in security will not add to productivity in a pre-September 11 context, so increases in productivity, the engine of longer term economic growth, are likely to suffer until productivity again becomes an investment priority.

Of course some industry sectors will benefit. Others will suffer. At the opposite ends of this spectrum, for instance, are the providers of airport security and the airlines themselves. Where agriculture fits into this range is open to conjecture.

Demand for food and particularly food commodities at the farm gate is not very sensitive to minor swings in economic activity. And we are not looking at the kind of difference that characterized the depression of the 1930's and the Second World War.

In the past the use of trade embargoes has had a material impact on grain markets. And even though Muslin extremists are seen as the most likely culprit for the atrocity, the target is the terrorists rather than nations.

While food self sufficiency is almost as rare as democracy in the Muslin world, there does not seem to have been any very immediate urgency by Muslin countries to cover their grain import needs. Past experience also suggests that a trade embargo is a very blunt weapon. Something sharper seems to be planned for terrorists.

Agriculture does not have any high profile and visible targets such as the World Trade Centre and might, therefore, consider itself relatively low risk as a terrorist target.

Security in the context of bio-security has, however, been a major issue for British agriculture for some time, with the food and mouth outbreak starting in February, a swine fever outbreak a year ago and even BSE precautions going back almost 15 years.

If not a high profile target, agriculture might be considered a very easy one by terrorists. A better awareness of their motives would provide a better understanding of whether agriculture is a likely target.

Elsewhere in the world agriculture is likely to suffer as security becomes the top priority in government budgeting. But in Britain agriculture seems to be such a low priority for government that any reordering is unlikely to have much of an impact.

Adversity faced by British agriculture in the recent past may yet provide it with the advantage of experience in facing the future.

September 24, 2001