Brexit could cut UK beef prices by 40%, says UCD Professor
Beef prices in the United Kingdom could fall by as much as 40% if the United Kingdom follows an unrestricted free-trade path after Brexit, according to incoming UCD Professor of Agriculture and Food Economics, Michael Wallace.
He was speaking at Brexit: Halfway there, implications for agriculture and food, a seminar organised by the UCD School of Agriculture and Food Science on 28th March 2018.
Under a unilateral free-trade agreement, the UK farming industry would be exposed to competition from large meat producers like Brazil. This would lead to lower prices for consumers but jeopardise the income of British farmers.
“When we impose a unilateral free-trade arrangement, obviously that reduces key commodity prices, particularly for beef and sheep and the consequence of that would be to push up the number of loss-making businesses closer to 50%,” said Professor Wallace.
He said the most dramatic impact would be felt in the beef sector, where prices could fall by as much as 40%.
Professor Wallace said the phasing out of direct payments – currently in place through the EU’s Common Agricultural Policy – could devastate the industry.
The effect of not replacing these “would be to push close to 80% of farming businesses into a loss-making scenario, which is obviously very concerning.”
Professor Wallace’s large-scale modelling study was completed at Newcastle University and included potential outcomes for 2,800 farming businesses across the United Kingdom.
Also speaking at the UCD event, Minister for Agriculture, Food and the Marine, Michael Creed TD outlined the “critical importance” of the agri-food sector in Ireland and its relationship with the United Kingdom.
In 2017, it employed 173,000 people, or 8.6% of all those employed in Ireland. It exported 38% of its produce to the UK, including 50% of Irish beef and 22% of dairy. Almost half of all Irish agri-food imports came from the UK.
Minister Creed also addressed concerns that the United Kingdom may try to prohibit access to its fishing zones. The Irish fisheries sector caught 60% and 43% of its top two most valuable stock – mackerel and prawns – in UK waters.
“My position and that of the European Union 27 is absolutely clear,” Minister Creed said. “We cannot accept any change in the current and long-standing reciprocal access and sharing arrangements to the detriment of Ireland and the European Union’s fishing communities.”
“The integrated nature of our agri-food trade is demonstrated by the fact that Ireland’s biggest export market is the United Kingdom and the United Kingdom’s biggest export market for its agri-food sector is the Republic of Ireland.”