Proposed peat ban does not raise major concerns for businesses says report

The Office for the Internal Market has recently published its first report, which found that the UK Government’s proposal to ban the sale of horticultural peat in England from 2024 would not have a major impact on intra-UK trade

Horticultural peat is mainly used in multi-purpose compost. The market for compost is worth around £400m in the UK.

A report to examine the effects of a peat ban followed a request in August 2022 from the Secretary of State for the Department of Environment, Food and Rural Affairs (DEFRA) for the Office for the Internal Market (OIM) to examine how the proposed ban may impact the effective operation of the internal market. The proposed ban is intended to tackle climate change by protecting peat bogs that are an important store of carbon.

The report concludes that, while the ban on horticultural peat sales in England may lead to some changes in patterns of buying and selling of peatcontaining compost within the UK that could have an impact on individual businesses, these are likely to be modest in the context of the overall market. The OIM does not expect there to be a significant impact on wider competition within the compost market. More specifically, the report finds that the likely effect on intra-UK trade will be modest because:

• only one in 10 consumers is ‘strongly motivated’ to buy a peat-containing compost

• many large retailers have already made commitments to stock only peat-free compost by the time the ban is introduced

• most manufacturers have already invested in research and development and new facilities necessary to make peat-free compost. Many will switch from producing peat-containing compost to peat-free compost rather than exit the market

• the Scottish and Welsh Governments have also signalled their intention to ban the sale of horticultural peat

Nevertheless, the report also notes that there may be some sales of peat-containing compost after the introduction of the ban, most likely through a small group of retailers who will still be willing to stock it. In addition, the report finds that shortages of the necessary inputs, especially if they persist, will increase the incentives for manufacturers and retailers to bring peat-containing compost into England from elsewhere in the UK. Northern Ireland is the most likely source of peat-containing compost to be brought into England after the ban is implemented.

The use of horticultural peat across the UK has been in decline for the last 10 years. The Scottish and Welsh Governments have also signalled their intention to ban the sale of horticultural peat. The UK has been successful in producing peat-free alternatives – almost doubling its peat-free production in the past decade – but significant additional peat-free material will be needed in the coming years to replace the peat that is currently used.

Commenting on this latest report Jennifer Pheasey, Director of Public Affairs at the Horticultural Trades Association (HTA) says: “The horticulture sector has been working hard to develop alternative professional solutions to using peat in growing media and is committed to becoming 100% peat free. Our members have already made great strides in transitioning away from the use of peat and the proportion of peat used in growing media is at an historic low for the industry (30% in bagged compost at retail and 51.7% in professional use).

“Defra has confirmed to the HTA that it is yet to determine the final policy and that the OIM’s use of 2028 was for the purposes of the report, and is not official policy. Government’s original ambition was for England to be peat free by 2030.

“We welcome the OIM’s conclusions around the importance of, and challenges associated with, ensuring access to sufficient alternatives to peat, and its acknowledgement that professional growers need to take an incremental approach to transitioning.

“The OIM report’s reference to a 2028 ban for the professional use of peat is based on Defra’s specified policy objective in its December 2021 consultation, and we await an announcement or decision on the final policy, which will be used for drafting the necessary legislation.

“We therefore reiterate that any government considering legislation to ban peat use should ensure they are ready to support the horticultural sector to develop and access responsibly-sourced alternatives which do not jeopardise the sustainability or price of the growing media, nor affect the quality of the crop produced. Facilitating research and development and knowledge exchange on best practice for growing peatfree is an absolutely essential part of this process. We need the Government’s support to ensure the transition away from peat enables the horticulture sector to play its vital role in contributing to environmental ambitions, while remaining competitive and sustainable as a business sector.”