Irish farmers will be holding their breath this week as the next round of Mercosur negotiations takes place in Montevideo, Uruguay. A deal is now very close as the South Americans appear to have met the EU’s requirements on access for cars and car parts. That leaves recognition of geographical indicators (GIs) and dairy as the two big issues left on the EU side, while beef is the one on the Mercosur side.

Mercosur

Any further access to the EU market for beef from major exporting countries will further damage the already weak Irish and EU beef producers. What is of further concern is a suggestion that the EU is looking at no restriction on the type of cuts, which means that Mercosur product could decimate the EU steak meat market which is one of the most valuable in the world.

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What makes Europe’s beef farmers even more vulnerable is the prospect of the UK market being out of reach in a bad Brexit scenario, which cannot now be ruled out.

Farmers would expect with this cloud of uncertainty that the EU would be more careful in giving access to its market. However, the problem is that beef farmers are the only losers in what otherwise would be an attractive deal for the EU. It is a regular feature of EU trade deals that beef farmers are asked ot take one for the team. On this occasion, it is a favour too many.

Brexit

Meanwhile, there are no signs of a breakthrough on Brexit as the June Council approaches. The latest big idea coming out of Whitehall is a ten-mile buffer zone on the Irish border with all of Northern Ireland having continued EU membership. If this idea was to get off the ground it would accommodate farmers on the island of Ireland selling their produce on the other side of the border.

However, in the wider trade context – never mind political issues – it wouldn’t meet the need for Irish access to the British market, which is the biggest market by far for each sector of farming.

As the clock ticks down to the UK leaving, they have yet to come up with an idea that is getting EU acceptance with the Commission's lead negotiator Michel Barnier now quickly and bluntly dismissing UK proposals that are floated. It also appears that negotiations are bogged down and talk of an extension to a transition period becoming louder.

For Irish farmers, the best outcome would be a transition period that never ended. Despite comments about a second referendum, unlike in Ireland, that is extremely unlikely.

What is more and as the Irish referendum last week so demonstrated the folly of calling a referendum without the ground work done in advance is a recipe for chaos. If Article 50 to leave the EU hadn’t been triggered and the negotiation conducted there would have been a logic to presenting a new post-EU agreement to the people with a clear choice of it or continued membership.

As the Italian crisis and the US President’s decision to impose tariffs on trade in steel with his closest allies demonstrate, international trade is particularly vulnerable. It is all the more reason that the EU should proceed with extreme care in giving further access to the EU beef market.