Fears of sterling collapse as the Brexit endgame looms
Meat processors say currency volatility will pile pressure on beef prices
Meat factories have warned that the Central Bank's prediction of a severe dip in sterling in the case of a crash-out Brexit would pile further pressure on weak beef prices.
Major concerns have been raised about the competitive hit that the €12bn food export trade would take in the case of a massive currency swing.
Meat Industry Ireland's (MII) Cormac Healy said the food sector has had to deal with a steadily weakening sterling over the last two years.
At the time of the Brexit referendum in summer 2016 the euro was worth 77p. However, sterling has weakened to 85-88p over recent months and the Central Bank has warned that it could fall close to parity in the event of crash-out Brexit.
"A weaker sterling piles more pressure on the competitiveness of our exports, on top of the challenges of tariffs, import quotas and potentially increased international meat imports into the UK," Mr Healy said.
"We also have concerns about the impact of a disorderly Brexit on the economies and in turn, consumer spending in some of our important continental EU markets," he added.
The Brexit debate had "generated uncertainty" for both farmers and processors, Mr Healy maintained, while weakening consumer sentiment had been "impacting on market returns for some time now."
However, the ICSA and IFA claimed that collapsing cattle prices meant farmers were carrying the can for the Brexit disruption.