The EU free trade deal with Japan came into effect this week. It has been under negotiation since 2013 and is one of the rare trade deals that presents opportunity rather than threat to agriculture.

Japan is consistently among the top three importers in the world for the main agricultural products of dairy, beef and pigmeat.

With Ireland approved to supply all of these, then the removal or reduction of tariffs has to present further opportunity.

Opportunities

Pigmeat from Ireland is already well established in Japan, even though China is our main Asian export market.

Similarly, Irish dairy is also on Japanese supermarket shelves, though beef exports have been confined to offal due to the penal 38.5% tariff that is in place.

Over a period of 15 years, this will be reduced to 9% and dairy tariffs will be eliminated immediately.

This has to present opportunity for cheese exports from the EU, as the tariff had been 30%.

Similarly, pigmeat tariffs are almost eliminated.

Japan is one of the world’s most densely populated countries, with just 360m2 per head of population.

It is also the world’s third-most powerful economy, after the USA and China, and is currently undergoing a change of dietary habit from traditional Asian cuisine to a western-style diet with more milk and meat.

Beef a slower burn

While Ireland will be able to avail of pigmeat and dairy opportunities immediately, beef will be a much slower burn.

The progressive reduction of the beef tariff means that there will be no dramatic immediate benefit and, additionally, Irish beef exports to Japan are confined to beef from cattle slaughtered under 30 months.

The timing of this trade deal coming into effect is also a boost for the EU, with Brexit now less than two months away.

The UK, including Scotland and Northern Ireland, will continue to avail of the EU-Japan free trade deal for the remainder of its membership of the EU, but once the UK departs, UK trade will revert to WTO most-favoured nation trade terms, the point where the EU was until this week.

Other potential deals

Conclusion of this trade deal may be good news for Irish and EU farmers, but there are a series of ongoing negotiations that present only risk and not opportunity to agriculture.

Mercosur is the longest-running of these and best known to farmers, but while discussions continue in a low-key way between officials, there is unlikely to be any major developments this year, with EU parliamentary elections in May and the appointment of a new commission in October.

Similarly, negotiations began with Australia and New Zealand in the middle of 2018, both of which are major exporters of agricultural produce and have ambitions to develop further business with the EU.

While they claim to be realistic in their ambitions for an agriculture quota, it is known that they have noted the access granted to Canada under the CETA agreement as a benchmark.

These are potential deals that Irish farmers will be watching.