Brexit: The unthinkable
It’s unthinkable that after 20 months of uncertainty the prospect of crashing out of the EU without a deal remains a very possible outcome, writes Livestock and Meat Commission’s chief executive Ian Stevenson.
As I write this article, government departments across each of the UK regions are actively stepping up their contingency plans in preparation for a no deal Brexit. It’s hard to imagine the amount of time, resources and effort being invested by government and industry towards no deal preparations in the hope that such arrangements will not be needed. From a red meat industry perspective in Northern Ireland, it is almost unthinkable that after 20 months of uncertainty since the UK voted to leave the European Union (EU) in June 2016, that the prospect of crashing out of the EU without a deal remains a very possible outcome.
In the 46 years since the UK joined the European Economic Community in January 1973, there has been huge change in agri-food industry structures and operations in Northern Ireland. The Common Agricultural Policy (CAP) was the EU’s first and, for many years, only fully integrated policy and it paved the way for the creation of the EU single market in 1992. Our red meat industry in Northern Ireland, from the production of raw materials to feed our livestock to the final packaged meat products available to consumers, has been shaped and influenced by EU support instruments and regulations and by the free movement of goods, capital, services and labour that are features of single market membership.
Within Northern Ireland the beef and sheep meat industry is worth over £1.5 billion to our local economy. Recent estimates from the Department of Agriculture, Environment and Rural Affairs (DAERA) for farm incomes in Northern Ireland for 2018 have recorded a farm output value of cattle and sheep of £545 million. The Northern Ireland beef and sheep meat processing sector, which processes and adds value to these farm outputs, generated sales of £1.1 billion in 2016 according to a report by the Andersons Centre, which LMC commissioned in 2017. On an end-customer basis £195 million of these sales (18 per cent) were to EU-27 markets and well-established value chain relationships have been built up over many years of product supply and servicing.
Unsurprisingly, industry conversation is dominated by Brexit at present and what the outcome of the current negotiations will mean for Northern Ireland beef and lamb. It has been difficult for local businesses to bring forward plans and to implement investment decisions with the uncertainty posed by future trading relationships, labour availability, agricultural support arrangements and access to markets.
Although UK and EU politicians have struggled to reach a consensus on what the withdrawal agreement should look like, the collective view of the agri-food industry in Northern Ireland is that a withdrawal agreement must be reached. This would allow for much needed progress to be made on meaningful negotiations about the future EU/UK relationships and avoid the alternative no deal scenario which would devastate our local industry. Despite the uncertainty the past 20 months has caused, industry has worked hard to continue to service its many customers around the world with the high quality produce they have come to expect.
This dedication resulted in some welcome news regarding the development of new export market opportunities last summer, which is a main priority for the industry pre- and post- Brexit. For the first time since 1996, a shipment of Northern Irish beef arrived in the Philippines and after over 20 years, China lifted its BSE export ban on UK beef. In January 2019, the UK received approval to re-commence the export of beef and lamb to Japan and our export plants are gearing up to supply this important market. Gaining access to new export markets is a major priority and something LMC, alongside other UK levy bodies and government departments are working collectively to achieve. Considerable growth in world meat consumption is forecast in the years ahead, particularly in Asia, the Middle East and North Africa and growing exports to third countries will be a key factor in balancing UK and EU markets.
