For some environmentalists and local politicians, the answer to the various challenges facing farmers seems to be to significantly cut output, despite the warning that this will simply lead to the UK importing more food from countries where the environmental impact is much greater.

What is also forgotten in the debate around these issues is the importance of the agri-food industry to the economy of Northern Ireland (NI), and if you cut production here, how are you going to replace the lost exports, revenue and jobs?

The latest employment statistics from NI Statistics and Research Agency continue to point to an economy that is overly reliant on the public sector, with a small manufacturing base.

Out of a total of 771,410 in employment, 81% work in service-related jobs such as retail, administration and tourism. Within that is a large public sector of 213,290 employees, accounting for 27% of all jobs.

But countries need manufacturing businesses to create wealth by innovating and exporting their goods. NI manufacturing companies employ 86,120 people, or just over 11% of all jobs.

Agri food is the largest sector within this category, accounting for nearly one-third of all manufacturing jobs. The industry also claims that for every employee, it creates three more along the supply chain, going right back to farms, so well over 100,000 people rely on agri food in NI for their income.

The other way to look at this is that for every farmer in NI (there are approximately 24,000 farm businesses), there are three people working further down the supply chain who rely on the output from those farms.

Without farmers, there is little or no NI agri-food industry, and the implications of that would be significant for the economy. There is no scope for the public sector to pick up the slack.

Beef and dairy still dominate

The farming industry in NI is predominantly livestock-based, and that is reflected in the sales from agri-food processing businesses.

The latest figures published by the Department of Agriculture, Environment and Rural Affairs (DAERA) show that in 2019, companies involved in beef, sheep and dairy processing accounted for 49% of total turnover. Poultry is next at 14%, followed by drinks companies, bakeries and pigs. The livestock share of total turnover has remained largely unchanged over the last 10 years.

What has changed is that the overall agri-food sector has grown, with turnover up by one-third to stand at £5.4bn (€6.35bn).

Employee numbers are up 25% to just under 25,000 full-time equivalents. A total of 314 companies have an annual turnover above £250,000 (€294,000).

However, over the last 10 years we have also seen some consolidation in the sector, especially in dairy processing, and the top 10 largest companies now account for 52% of turnover, compared to 47% in 2010.

Six years of Brexit – more to come

Since before the UK’s referendum on EU membership in 2016, the issue of Brexit has been at the forefront of the minds of agri-food industry leaders in NI.

After the narrow vote to leave, the key ask from the industry was that whatever solution is found, it would involve no border checks and controls either across the island of Ireland, or to NI’s main market in Britain.

In the end, the Irish Protocol within the Brexit withdrawal agreement largely achieves that, with NI companies able to trade freely into the EU27 and into Britain.

However, checks and controls on goods coming from Britain to NI make the protocol an unsatisfactory solution, and one that is politically divisive.

More flexibility is required if it is to work over the long term, and with a consent mechanism built in which gives MLAs at Stormont a vote on whether to retain the protocol every four years (the first vote is in 2024), it is an issue that will continue to run.


To understand the position taken by the industry around Brexit, and why some leaders have since spoken openly about their support for the protocol, it is necessary to look at where the NI agri-food industry does most of its trade.

Britain is the largest market outlet, accounting for 47.5% of all NI agri-food sales. The home market is next, taking 23.1%, followed by the Republic of Ireland at 15.9%. That leaves the rest of the EU at 7.6% and the rest of the world at 5.8%.

However, averages can be deceiving, and the dependence on the market in Britain varies across the sectors.

In beef and sheep processing, Britain accounts for 68% of sales. Given that a significant number of lambs processed in NI end up in the French and German market, for beef only, the figure is probably closer to 80%.

That reflects the fact that all the big beef processing companies in NI have contracts to supply major UK retailers with product that meets Red Tractor assured standards.

The market in Britain is also important for NI poultry. It is an industry dominated by Moy Park, which supplies most of the major UK retailers. Over 60% of NI poultry sales end up in Britain.

For pigs, the figure for sales to Britain is around 30%, while in dairy processing it stands at 38%.

But the NI dairy processing figures do not account for the fact that around one-third of NI production (over 800m litres) goes to the Republic of Ireland each year for processing.

Add in that 17% of NI dairy sales are to the Republic of Ireland and 19% are to the rest of the EU, it is obvious why representatives from the NI dairy industry did not want to see either border controls in Ireland or to the rest of the EU.

A Brexit outcome that involved checks and tariffs between NI and the EU would have been devastating.

Climate legislation

In June 2019, the UK was the first major developed country in the world to set a legislative target for net zero greenhouse gas emissions by 2050.

Achieving that will require a radical change in transport, energy supply, agriculture and in how our homes are heated.

According to the UK Climate Change Committee (CCC), the body which advises the UK government on climate policy, achieving the net zero target is “technically feasible, but highly challenging”.

Despite that, many politicians continue to push for even more exacting targets, pointing to the extreme temperature events, wildfires and floods seen across the world in 2021.

A bill put forward by Foyle MP Colum Eastwood, which is due to be debated in the UK Houses of Parliament in December 2021, would require government to bring forward the net zero date.

In NI, which is the only devolved country within the UK without specific climate change legislation, there are currently two competing climate change bills on the table for MLAs at Stormont to consider.

The first is that brought forward by Agriculture Minister Edwin Poots. It includes a 2050 target for NI to reduce emissions by 82% when compared to 1990 levels, as part of the overall UK target for net zero emissions by that date.

The second piece of prospective legislation is a private member’s bill, sponsored by NI Green Party leader Clare Bailey, and supported by all the major political parties in NI, outside of the DUP. It includes a target for NI to have net zero greenhouse gas emissions by 2045.

Having been tabled first, that bill is further along the road to being made into legislation, and it remains unclear how everything will finally play out.

However, for NI farming, the implications are potentially very significant.

Emissions target crucial

Net zero by 2045 versus an 82% reduction in greenhouse gas emissions by 2050 might not seem that big a deal but, in reality, there is a world of difference between the two targets.

The net zero target in the Clare Bailey Bill is based on the fact that other countries have now set similar targets. But there is no accompanying impact assessment, nor does it set out a pathway as to how NI gets there.

Conversely, the 82% target in the Edwin Poots Bill is based on advice from the UK Climate Change Committee (CCC), which has undertaken detailed modelling of data to produce recommendations as set out in its “Sixth Carbon Budget” published in December 2020.

In a letter to Minister Poots in April 2021, the chair of the CCC Lord Deben made clear that the 82% figure is “part of a fair contribution to the UK net zero target”.

So why hasn’t the CCC recommended that NI gets to net zero by 2050? There are a number of key issues to consider:

  • The NI agri-food industry is a major exporter, selling nearly 75% of its production outside the region, with approximately 50% of all sales being to Britain. Given that the UK overall is only around 60% self-sufficient in food, it would be perverse to cut production in NI, only to import more from further afield, with potentially higher associated emissions.
  • The CCC recognises that NI is predominantly a ruminant livestock region, and its climate and soil type is best suited to this form of production agriculture. But with ruminant livestock comes biogenic methane from the rumination process. At present, official data published by the Department of Agriculture, Environment and Rural Affairs (DAERA) shows that agriculture accounts for 26% of total NI emissions and around 65% of this is due to methane.
  • While technology might solve emissions related to fuel and fertiliser, and feed additives and improved management can reduce biogenic methane, to cut it to zero would require ruminant agriculture to end. Given that is not a rational option for NI, the CCC recognises that by 2050 NI will remain a small net source of greenhouse gas emissions, which almost entirely will come from agriculture, and from methane in particular.

    In addition, there are separate arguments around the whole methane issue, as it breaks down in the atmosphere after around 10 years. Ruminants take in carbon sequestered by forage, and release it as methane, so the emissions are part of a cycle. As a result, a stable cattle herd is not contributing to global warming.

    At the same time, a smaller herd, or one that is more efficient, could lead to global cooling. One suggestion put forward by Lord Deben is that NI sets separate targets for methane, meaning it could adopt a net zero target for all other greenhouse gases by 2050. In their “balanced pathway”, methane emissions in NI would fall by 42% from 2020 to 2050 while all other emissions would get to net zero.

  • The third reason why the CCC has opted for an 82% target for NI relates to greenhouse gas removal technology, and where it should be located.
  • It is understood that a significant part of the UK plan to get to net zero is reliant on carbon capture and storage technology.

    As an example, agricultural land is used to grow biomass, which in turn is burned in power stations where the carbon can be removed during the combustion process. The carbon is then put into long-term storage underground (in areas that were once used to extract oil and gas).

    The Lord Deben letter to Minister Poots refers to “strong strategic reasons to locate these technologies outside of NI”. In particular, there are no suitable carbon storage sites close to NI. If this technology was sited in NI, it would cost an additional £900m per year by 2050, suggests the CCC analysis.


    However, even if NI eventually adopts an 82% target as opposed to one that involves net zero, the impact on NI agriculture will be significant.

    The CCC has suggested that our diets must change, with 20% less meat and dairy consumed in the UK by 2030, rising to a 35% by 2050.

    This will free up land to plant trees and restore peatland. In NI, the CCC has recommended that 46% of agricultural land is taken out of production by 2050.

    NI farming decimated by net zero

    Those advocating for a net zero greenhouse gas emissions target by 2050 or before often point to a statement made in a letter from Lord Deben to Minister Poots where the CCC chair refers to there being no “purely technical reason” why net zero is not possible in NI.

    However, the same letter goes on to state that this can only be achieved by a substantial reduction in output from livestock farming (more than 50%) and/or a much greater than equitable share of carbon capture technologies being located in NI.

    As a result, the clear advice of the CCC is that a net zero target “cannot credibly be set for NI”. The CCC also warns that setting targets that are too ambitious could undermine the ability to get wider society to adjust to a new normal.

    KPMG analysis

    To consider what impact a net zero target by 2045 would have on NI agriculture, various industry groups in NI tasked consultancy firm KPMG with undertaking an economic assessment of the private member’s bill brought forward by Clare Bailey.

    That work concluded that to hit the 2045 net zero target would require an 86% reduction in cattle and sheep numbers in NI by that date. In effect, dairy cow numbers would reduce from their current 313,000 to just 44,000, with beef and other cattle falling from 1.3m to 180,000. The NI sheep flock would fall from 1.99m to just 276,000.

    The impact would be less severe in the intensive pigs and poultry sector given that as non-ruminant animals, methane output is much lower. The KPMG report points to an 11% contraction in pig and poultry numbers by 2045.

    However, the net effect of an 86% reduction in cattle and sheep is a 54% decrease in farm employment, with around 13,000 jobs lost. Many farm supply businesses, feed companies and food processors would close.

    Over the period from 2021 to 2045 the total lost economic output to NI would be around £11.1bn. That is an economic hit that rural towns across NI simply cannot afford.

    NI no longer bound by the CAP

    One potential upside of Brexit is that NI is no longer bound by the EU Common Agricultural Policy (CAP), and can bring forward its own schemes directly applicable to local farmers.

    An example often used by those pushing for a vote to leave in the runup to the 2016 EU referendum was the bureaucracy imposed by the likes of Greening and the three-crop rule, despite these policies being of little to no relevance to NI.

    However, it is often easier to criticise from the side rather than lead from the front and, in general, NI farming leaders will have looked on in horror at the policy direction being set in England over the last 12 months.

    The first cuts to the Basic Payment Scheme (BPS) start in 2021, and by 2024 all farmers will see their BPS money halved, with payments fully removed in England by 2028.

    The direct payment system is being replaced by various schemes, although the bulk of any farm support will be directed at a headline Environmental Land Management Scheme (ELMS).

    There are three parts to ELMS:

  • Sustainable Farming Incentive.
  • Local Nature Recovery.
  • Landscape Recovery.
  • The local nature and landscape recovery schemes will pay farmers who work together to improve the environment in their local area, or for long-term projects such as tree planting. Pilots are to be undertaken in 2022, ahead of a rollout in 2024.

    While details on these schemes are limited, farmers do have some insight into the Sustainable Farming Incentive, with a pilot opened to applications this summer, ahead of a wider launch in 2022.

    It includes eight different standards, with farmers able to choose which ones apply to them and the ones they wish to do.

    For example, in the “Improved Grassland” standard, to achieve the highest rate of £97/ha (€114/ha), farmers must:

  • Introduce diverse grass, herb and legume swards on 20% of their improved grassland.
  • Ensure 75% of grazing is at least 8cm in length during the growing season.
  • Allow at least 2% of ryegrass to seed out over the winter.
  • Reduce nutrient inputs.
  • Soil-test at least 20% of the farmed area every year.
  • Use precision application equipment to apply fertilisers and manures.
  • The scheme will focus on the outcomes of the actions taken by farmers, with delivery monitored by physical and virtual site visits, and desk-based checks.

    For participating farmers, the bureaucracy that came with CAP greening and the three-crop rule might not look so bad in the end.

    Developing policy for NI farming

    Unlike farmers in the Republic of Ireland, who have the security of multi-year budgets (the current CAP budget runs to 2027), one of the consequences of Brexit is that farmers in NI are now reliant on an annual request to the British Treasury for direct payment funding.

    The UK government has guaranteed that cash support will remain at current levels for the present parliamentary term, due to end in 2024, but beyond that, there are no certainties, and agriculture will be competing with health, education, etc, for yearly allocations.

    However, with direct payments accounting for 96% of NI farm business income in 2019-2020, there is little appetite from within the industry for a rapid change to current area-based schemes.

    But there is also an awareness that farmers will have to do more to justify payments going forward.


    A framework for future agricultural policy was originally set out by DAERA in 2018 and can be defined around four outcomes of:

  • Increased productivity as a means to sustained profitability.
  • Improved resilience to external shocks.
  • An industry that is environmentally sustainable.
  • An industry that operates a responsive supply chain.
  • So what does all this mean in practice? To improve resilience to external shocks such as weather events, it is likely that an area-based payment will be retained.

    But as highlighted in a DAERA document published in August 2021, policymakers believe that the current Basic Payment Scheme (BPS) blunts productivity and innovation. As a result, there will be a gradual transition to a new resilience payment, set at a lower level than the BPS. It will be targeted at active farmers, and conditional on the likes of farm nutrient management planning, and meeting various requirements currently part of the cross-compliance regime.

    Sitting alongside the resilience payment is a specific measure for beef and sheep farmers involving headage payments for sucklers and breeding sheep.

    Providing support per head is something that Agriculture Minister Edwin Poots is known to favour as a way of targeting payments. However, this scheme will be different to those that existed before the 2000 CAP reforms, and instead linked to various efficiency and environmental measures.

    The Department is also to consider whether a headage payment for beef and sheep could integrate with a new livestock genetics programme which aims to accelerate genetic improvement across beef, sheep and dairy.


    Reducing the amount going to farmers via an area-based payment frees up money for other schemes.

    An agri-environment package will form the central plank of new policy, with various measures that reward farmers for improved environmental outcomes. The DAERA document from August 2021 also refers to “encouraging the farming of carbon” via land and soil management, and planting more woodland.

    Soil scheme

    Back in June, Minister Poots announced that plans are being developed for a five-year soil-sampling scheme across NI.

    That scheme is a clear indicator of the future direction of travel. Establishing a baseline will help inform farmers around the best targeting of nutrients (to improve productivity), and where oversupply is likely (to protect water quality and the wider environment).

    It will also be crucial to getting a better understanding of how much carbon is in our soils and how much we can potentially sequester going forward.

    Ultimately, it is the legal target set for carbon emissions (by 2045 or 2050) that will be the main driver of all future agricultural policy.

    In short

  • Actively targeting a net-zero carbon policy by 2045 would effectively decimate farming in Northern Ireland.
  • Brexit now means that the safety net of the CAP is to be replaced by support from Westminster but will that support be adequate or long-lasting?
  • Alternative support schemes are likely to be put in place but only time will tell if the regulations for qualification will be more or less arduous than those in the CAP.