Agri-food co-ops in Europe and Ireland want smoother trade

Copa-Cogeca is among organisations calling for measures to limit disruption - while Ireland's Lough Neath Fisherman's Co-op is among those cut out of key markets

Agri co-op representatives in the EU and Ireland have have welcomed the last minute Brexit deal but warn it is not enough to avoid border disruptons or extra costs.

Copa-Cogeca, the voice of European farmers and agri co-ops, voiced its concerns in a joint statement with Food and Drinks Europe and CELCAA, the European Liaison Committee for Agricultural and Agri-Food Trade.

The organisations  praised the deal for “avoiding large tariffs which would have hit food and drink operators under a no-deal scenario” and ensuring the integrity of the single market. But they say urgent measures are needed to avoid potential disruptions to the EU-UK trade in agri-food products, which is worth around €48bn.

“We all need to look at the detail of the agreement to understand the full implications,” their statement read, “but it is essential for EU and UK authorities to move at lightning speed to ensure businesses understand the new trade requirements, that border controls can operate efficiently from January 1 and that the Commission has a crisis management protocol, including direct communications with agrifood chain operators, to identify and solve border issues as they arise over the coming weeks and months.”

They added: “Failure to move quickly will lead to more border chaos and supply chain disruption that will not only put thousands of jobs at risk, but also impact the safe supply of affordable agri-food products to consumers.” 

Agri-food sector representatives also want a swift deployment of the EU’s €5bn Brexit Adjustment Reserve. The three apex bodies urged the European Commission and relevant authorities to implement a series of measures to ensure a smooth transition.

They want an effective transition phase from 1 January 2021, towards the eventual full implementation of new trade rules.

Adequate human, technical and financial resources should be allocated to implement and enforce the new customs and sanitary and phytosanitary (SPS) measures, they say. And the new rules should be clear to interpret and enforce, to ensure predictability for business.

They want policymakers to reiterate the “essential” nature of the agri-food value chain and maintain ‘green lanes’ alongside other customs measures, which were successfully deployed during the Covid-19 lockdown to fast track agri-food products across borders.

Business-friendly guidance should be circulated to enable better planning and preparedness, they add. 

And a rapid deployment of the €5bn EU Brexit Adjustment Reserve, particularly for SMEs, farmers, agri-cooperatives and traders already suffering from the Covid-19 impact, would help businesses through the transition, they argue. Job security for the agri-food sector workforce is particularly important in this context.

A continued formal communication channel should be in place for agri-food chain operators to communicate with the European Commission and national authorities to raise issues and solve them as they emerge over the coming weeks and months, they say

And they want special attention paid to trade in products between Great Britain and Northern Ireland, in order to protect the integrity of the single market and acknowledge the need for enduring solutions – particularly on SPS measures and new labelling rules.

Meanwhile, the Irish Co-operative Organisation Society (ICOS) warns that the Irish agri-food sector faces a minimum 8% increase in Brexit related costs.

ICOS welcomed the announcement that Ireland is to receive €1.05bn under the EU’s Brexit Adjustment Reserve, which represents 25% of the overall EU funding available.

ICOS president Jerry Long said: “This is in recognition that we are the country most impacted by Brexit. The agri-food industry has been preparing for Brexit since the 2016 referendum; however, the consequences are long-term and are leading to major changes in industry, which require continued support.”

“In order to reduce our dependence on the UK market, our co-operatives are investing heavily in diversifying products to export to new markets, a process which will continue over the coming years. 

“We must also continue to invest in our actions on the environment and climate, both at farm and processing level to maintain our position as partner of choice for sustainable and premium agri-food products within the UK, EU and North American markets.

“Trade with the UK has now become more expensive for business, despite the agreement reached in December, due to the imposition of new administration and controls for importing and exporting businesses. 

“At minimum, we estimate an 8% cost increase for the agri-food sector as a result of these additional certification and administration processes. The Brexit adjustment funding must go towards mitigating these costs, supporting preparation by businesses, such as further recruitment of new personnel, technology, training and upskilling, and there should also be a retrospective element to the funding as many businesses have already incurred very significant costs.

“The UK’s departure from the EU has also brought implications for our all-island dairy economy, as products of mixed milk origin are now unable to access EU market supports. In many cases they also cannot benefit from preferential access provided by EU free trade agreements on international markets. This leaves the industry particularly vulnerable and in need of support as it adjusts to these new complexities.”

ICOS believes funding should be administered in the form of schemes, such as export trade financing and export credit guarantees; production and logistical capital investment support, support for investment in sustainable agriculture and processing, market research and promotion support, recruitment, training and upskilling within businesses.

Individual co-ops are already warning of the impact of Brexit on their business. Lough Neagh Fishermen’s Co-operative cannot export its eel catch to the Britain – where London, home to the jellied eel, is an important market. 

This means the co-op needs to find new markets for a fifth of its catch – 50 tonnes of eels, worth £500,000,

Trade in European eels, an endangered species, is strictly regulated and conservation measures include a ban on sales outside the EU.

Other rules make it harder for the co-op to restock its waters, with a ban on the import of juvenile eels which were previously brought in from Britain.

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