Farm Ireland

Friday 15 December 2017

Beef trade will be 'decimated' by a hard Brexit

'Losses could be enormous,' warns Teagasc economist

British Prime Minister Theresa May. Photo: Reuters/Neil Hall
British Prime Minister Theresa May. Photo: Reuters/Neil Hall

Darragh McCullough and John Downing

Many beef farms could face a battle for survival if Britain pushes ahead with a hard Brexit, according to some of the country's leading agricultural experts.

The dire forecasts follow the British Prime Minister's speech last week indicating that Britain is veering closer to a 'hard' exit from the EU over the next 18 months.

"If the inevitable decreases stemming from Brexit come on top of lower prices associated with the extra 100,000 head of stock that are starting to come through the system this year, the losses could be enormous and enough to decimate some farms," said Teagasc's Kevin Hanrahan.

"It could end up being the biggest restructuring event in the sector in living memory.

"This isn't a reversible scenario, so it would cost a fortune to cover the losses with subsidies - the public might be willing to pay for this for the medium term, but not long term," he said.


A spokesman for beef processors said that Brexit could be "catastrophic" for Irish beef farms.

"If we end up with a situation with basic World Trade Organisation (WTO) rules it would have a catastrophic effect for the wider sector," said Meat Industry Ireland's Cormac Healy.

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However, the lobbyist insisted that beef factories were preparing themselves for a long fight.

"We're not giving up the ghost yet. There's a long way to go, but we need to be pushing more for state aid because this is a structural change," he said.

But he admitted that Brexit would have a negative effect on prices, regardless of the final detail.

"No matter what it is, it's a negative - you've just got to scale it back," he said.

Agri-economist Professor Alan Matthews told an Oireachtas hearing last week that Brexit would be a "very big negative shock, and a permanent one".

However, the Minister for Agriculture Michael Creed struck a more optimistic note last weekend.

"It's hard to envisage a scenario where Europe will inflict damage on itself," he told the Farming Independent.

"In that sense, Europe has an interest in trading with the UK as well. I think that, eventually, business sense will prevail," he said.

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