Boris drops the bluster and prepares to do a deal

This week it was John Lewis, Marks and Spencer and Pizza Hut,with a lot more to follow over the coming days and weeks. The trend for shopping to move from the High Street to online has been accelerated by the coronavirus crisis and this is a trend that cannot be stopped.

Farming has always been an industry that is intensely satisfying and intensely frustrating. The frustrations tend to come from outside sources rather than the daily business of farming. High on the list for the past four years has been a final resolution of Brexit. This has created uncertainty for all businesses, but even more so for farmers given their dependence on the EU for support and for markets.

Support arrangements remain up in the air, but we are now very firmly in the last chance saloon for a deal on markets, in the shape of a trade agreement with the EU-27. If Boris Johnson is to stick by his commitment that there will be no extension to the transition period, due to end in December, a deal has to be in place by October. That is essential to give all 27 member states time to ratify it. Normally in August nothing happens in Brussels, but talks with the UK are continuing. This week, for the first time, Downing Street has been seeking to send out a positive message on the prospects for a deal.

It may be down to his brush with coronavirus and the impact it had on his health, but even over Brexit, Johnson is now very much hands off. He was elected by his party on the basis that there had to be undiscovered ability behind his bluster, but now even the bluster is missing. Deep down he must know that damage to business from Brexit is the last thing the economy can afford.

The UK economy has become over-concentrated on the service sector and that cannot be changed quickly, even if there was a will in government to drive those changes. A bad Brexit deal, from a political standpoint, would do minimal damage. A bad Brexit deal from a business perspective would be devastating. Johnson must know that and this is perhaps why the message from Downing is was more conciliatory towards Brussels than has been the case for months.

Farming has lots going for it, in that it produces a product in daily demand. The retail sector upon which it depends – the supermarkets – remain stable. Their fight is about market share and margins, and unfortunately that is a fight that impacts farmers via prices. However nothing can change the dynamic that food is a perishable product in demand every day of the week. The big threat comes not from changing sales patterns, but from the government's apparent willingness to barter UK quality standards to buy trade deals beyond the EU-27.

That is more about politics than economic logic, but to date this has been the hallmark of the Johnson government. The EU, through Michel Barnier, has accused the UK of being 'unwilling to negotiate'. Now Downing Street, presumably via Dominic Cummings, is saying it is hopeful of a trade deal next month.

To most EU watchers this comes as no surprise. This is how EU negotiations progress to an outcome, with both sides positioning themselves to claim they held firm to their principles, but compromised because it was vital to deliver a deal. At the same time they are seeking to ensure they will not be left with the blame if things go wrong.

In simpler terms both sides now have their ducks in a row for a deal. Even if hard-line Brexiteers in the Conservative party accuse Johnson of backing down, their views will gain little traction amidst the economic mayhem we are now in, having moved back to the economics of the 1970s by facing both stagnation and inflation.

The sticking points to a final deal are not about agriculture. They are about fisheries, the role of the European court, state aid rules and issues around labour rights and competitiveness. These are not insurmountable – we are on our way to a deal and when that happens it will be a big worry off farmers' shoulders.