EU exit perspectives: A view from Europe

With so much focus on the implications for UK industry, it is easy to forget that leaving the EU has sent shockwaves across Europe. In this week’s blog, our policy manager Tania Gesto-Casás reports on what two of our key red meat suppliers, Denmark and Ireland, are concerned about and the steps they are taking to prepare.

The UK Exit from the EU has dominated media coverage – and private conversations – in the UK during the last few years, focusing often on the potential impacts for UK industries. To provide a different perspective to the debate, the AHDB invited Knud Buhl, who represents the Danish pig industry, and Cormac Healy, representing the Irish meat industry, to a webinar where they shared their views on the expected impact for the EU meat sector and what they are doing to get ready.

All eyes are now in the ongoing EU/UK trade negotiations, as the scale of the impact will vary greatly depending on whether there is a Free Trade Agreement (FTA) or not. Both speakers agreed the UK is hugely important in the overall European meat market scene and trade with the UK, both inwards and outwards, is key to overall market balance. In a no-trade-deal scenario, World Trade Organisation (WTO) tariffs would apply. If these tariffs remain at their current level, it would mean that imports of Danish pork into the UK could become between 30 to 40 per cent more expensive. The overall cost of tariffs for Irish meat exports into the UK (including beef, pigmeat, poultry and sheepmeat) in case of no deal would be over €900 million, with the cost for beef alone amounting to as much as €700 million. The picture becomes even gloomier for EU meat exporters if the UK is to agree trade deals with other major agriculture exporters, such as the US, giving them a price advantage that could push European suppliers out of the UK market.

Having an FTA in place ensuring zero-tariff, zero-quota trade between the EU and the UK at the end of the transition period is therefore paramount for the EU meat industry. However, even with a deal in place, trading with the UK will be more burdensome next year. Regardless of the outcome of the negotiations, at the end of the transition period the UK will be leaving the EU Single Market and the Customs Union. For meat traders, this will mean additional administration and additional paperwork to fill out. This will undoubtably lead to bottlenecks and disruptions in the borders in the short term.

Nonetheless, both our speakers were confident these initial disruptions will be smoothed over in the medium to long term. The meat industry has shown an ability to adjust to changes in the past. The main EU companies have customs familiarity due to their trade operations with other third countries, and they have taken the necessary steps to get ready, such as applying for their EORI number, looking at the IT systems and talking with customers about potential impacts, to name but a few.

The main difficulties, however, lie in those areas where we are still waiting for clarifications from the authorities such as technical issues regarding export certification or, more broadly, the nature of the trading relationship between the EU and the UK when the transition period ends. The feeling of the EU industry is they are as prepared as one can be in the current circumstances but the fact is the only sure thing is uncertainty.