The announcement on Friday evening that the EU and US have agreed to suspend tariffs in relation to the Boeing-Airbus aircraft dispute has a welcome spin-off for Irish dairy farmers.

This is because when the US was cleared by the World Trade Organisation (WTO) to impose retaliatory tariffs on the EU in 2019, one of the sectors it chose was EU dairy exports.

It applied a 25% tariff, which immediately made Irish butter and cheese exports to the US 25% more expensive than they were previously.

In spite of this, Irish dairy exports to the US, particularly butter and cheese, continued to increase even after the tariffs were imposed in late 2019.

Bord Bia data shows that Irish dairy exports to the US in 2018, the last full year before the 25% tariff was introduced, were worth €295m, increasing in 2019 to €343m.

Substantial quantities of Irish dairy products were exports were sent to the US in anticipation of the introduction of tariffs in late 2019.

What is particularly interesting to note is that last year 2020 showed the value of Irish dairy exports to the US increasing again, despite the 25% tariff, to €359m.


Looking at volume, in 2018 Ireland exported 48, 475,309kg to the US. In 2019 this increased to 54, 372,488kg and it increased again in 2020 to 57,399,713kg.

Butter makes up half of all Irish dairy export to the US in volume and value, at 29,902,764kg in 2020 worth €186m.

This indicates that in spite of the imposition of a 25% tariff on Irish and EU dairy exports to the US in late 2019, Irish dairy exports were able to continue uninterrupted with the market absorbing the additional 25% cost.

Now that the 25% tariff cost is removed, Irish dairy exports to the US should expand at an even faster rate.

The challenge for dairy exporters to the US is to retain as much of the 25% extra that the market demonstrated it was willing to pay in tariffs and reflect in the milk price paid to Irish farmers.