Farm Ireland

Thursday 19 July 2018

EU is 'committed' to a Mercosur deal: Hogan

But farm leaders warn that 'ultra-cheap' South American meat imports pose serious threat to Irish beef sector

European Agriculture Commissioner Phil Hogan.
European Agriculture Commissioner Phil Hogan.
Louise Hogan

Louise Hogan

Agriculture Commissioner Phil Hogan has confirmed that the European Union remains committed to a deal with the Mercosur trade bloc, but farm leaders have warned it will open the "floodgates to ultra-cheap" South American beef.

Concerns have been rising in recent days about the impact the proposed deal with South American producers will have on Ireland's €2.5bn beef industry which depends on EU markets for over 90pc of its exports.

The draft proposal from the EU involves 78,000t of beef, including 39,000t of high value beef cuts on a low tariff rate quota of 7.5pc.

Thirteen member states, including Ireland, France, Austria and Poland, have warned the Commission that a deal with the South American alliance would have a "ripple effect" on all ongoing trade negotiations.

A joint statement highlighted the "particularly difficult crisis" facing European agriculture and stated that a deal centred on increased quotas for "sensitive products" like beef would be seen as a provocation by EU countries.

However, Commissioner Hogan told yesterday's EU Farm Council meeting that a study on the effects of all ongoing and upcoming trade negotiations involving EU agriculture was underway.

He said the Commission remained "committed" to the Mercosur process but was "also determined to defend and promote the EU's interests" in the negotiations which were crucial for European agriculture.

"It is essential that we convey a consistent message towards Mercosur. While the EU is ready to make a meaningful contribution in agriculture, Mercosur should moderate its expectations to what is manageable and acceptable to the EU," he said.

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Agriculture Minister Simon Coveney has written to EU Trade Commissioner Cecilia Malmstrom highlighting Ireland's concerns over the proposed deal with Brazil, Argentina, Venezuela, Paraguay and Uruguay.

Mr Coveney, who was replaced at yesterday's EU Farm Council meeting by the Department of Agriculture secretary general Aidan O'Driscoll, said any Mercosur deal involving tariff rate quotas would not be in the long-term negotiating interests of the EU.

The IFA's national chairman Jer Bergin warned such a deal would hit our beef industry hard, but would also impact the pigmeat and poultry sectors. "Previous analysis by the European Commission has shown that a Mercosur deal would inflict losses of €7.8bn on the EU agriculture sector," said Mr Bergin.

Job losses

"The individual losses at farm level would be much higher, particularly for beef farmers. This would have a major knock-on effect on rural economies, resulting in job losses."

The ICSA's president Patrick Kent warned the draft EU offer of 78,000t "essentially opens the floodgates to ultra-cheap South American beef imports" and would "sacrifice" the sector to secure the trade deal.

"A deal at a time when farmers across Europe are already feeling the pressure due to price volatility in all commodities and the knock-on impact of the Russian ban would be reckless and irresponsible," Mr Kent warned.

Meat Industry Ireland spokesman Cormac Healy said it would be "unjustified and damaging" for the EU to offer Mercosur countries specific figures on import quotas of sensitive products such as meat and beef.

Joe Burke, Bord Bia beef analyst, said there were already quite substantial imports of beef into Europe, with around 70pc from South America and Brazil the biggest supplier.

Mr Burke said Brazil was a huge producer but it did not all meet EU standards so this could impact the volumes involved.

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