Potential €35/head no-deal tariff sees Northern farmers cut sheep numbers
The Republic of Ireland has acted as an important outlet for the Northern Ireland sheep sector and has traditionally taken approximately half of the lambs produced in the region.
However, industry leaders in Northern Ireland have warned that this could dramatically change in the event of a no-deal Brexit.
If no deal can be reached prior to the UK’s departure from the trading bloc then WTO tariffs will be applied to Northern lambs heading south for slaughter at point of export. The current tariff for live sheep is €80.50/100kg liveweight.
The Livestock and Meat Commission (LMC) in Northern Ireland has said that assuming an average liveweight of a lamb/hogget of 44kg this would put the export tariff at €35.42/head.
Using last week’s average euro/sterling exchange rate the tariff equates to £30.38 per lamb exported.
The LMC said a tariff of this level would effectively shut off this market outlet for the Northern Ireland sheep sector.
It said while there is potential for processing plants in Northern Ireland to increase slaughter capacity for sheep a market outlet still needs to be identified for any additional lamb that is processed.
"During 2018 local lamb processing plants exported approximately half of of their product to EU markets.
"While UK consumers could undoubtedly increase consumption of domestically produced lamb in the short term domestic product tends to have a higher price point than imported product which could impact consumer spending. there are also issues around the seasonality of production in the UK with current peaks in demand for lamb not matching production systems," it said.
Irish meat factories have also warned of the implications linked to a hard Brexit that would be the barrier to NI lambs being shipped south for processing.
Meat Industry Ireland said the loss of this throughput in Irish plants would seriously challenge processing efficiency and also undermine companies’ ability to service established markets.
The Department of Agriculture in Northern Ireland have just released the preliminary results of the December 2018 Agricultural Survey and this indicated a 4pc decline in breeding ewe numbers and a 9pc decline in the number of ewe lambs that were tupped when compared to December 2017 levels.
This is the first time that sheep numbers in Northern Ireland have recorded a decline in the December Agricultural Survey since 2013.
The LMC said this decline in the breeding flock are most likely a reflection of the current uncertainties being faced by the Northern Ireland sheep sector and will go some way to offset any gains from reduced mortality on sheep farms this Spring.
The Ulster Farmers’ Union says the government’s import tariff plans for a no-deal Brexit would devastate Northern Ireland’s farming industry. UFU president, Ivor Ferguson, says the plans are further proof that a no deal Brexit would have catastrophic consequences for Northern Ireland.
“We have very real concerns about the proposal for a zero per cent tariff on agricultural goods coming from the Republic of Ireland (ROI) into Northern Ireland and the differential treatment with ROI and GB trade where tariffs will apply. This would drive down prices and hit producers here.
"It could also potentially open the door to illegal trade which would seriously impact on the integrity of the NI agri-food industry. It is unlikely the EU would offer the same zero tariff to Northern Ireland or the UK as a whole. This is why we have called for reciprocal tariffs. Whatever the EU applies, the UK should apply in return.
"The tariff plans emphasise why a no deal Brexit must be avoided,” said the UFU president.
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