The Irish beef sector is set to be trapped in a lose-lose Brexit scenario, with hundreds of millions of euro of losses on the line.
The Irish Farmers Journal can reveal that punitive trade tariffs will be imposed on Irish beef by the British government, but a possible loophole in the form of a tariff-free quota will also apply to Ireland's main competitors, lowering prices.
On Tuesday, UK environment secretary Michael Gove pledged to protect British farmers through the imposition of tariffs on agricultural imports post-Brexit.
Sensitive products such as beef will have high tariffs imposed.
This is bad news for Ireland, particularly when it comes to beef. Currently Ireland and fellow EU members enjoy tariff-free access to the UK within the single market. The rest of the world must pay tariffs at WTO levels, giving us a €3/kg competitive advantage over US and Brazilian beef.
Meat Industry Ireland on Tuesday estimated the cost at €750m per annum
Now, Ireland will be forced to compete with Brazil and others on a level playing pitch. Over half of Irish beef goes to the UK, and it comprises 70% of their imports.
This will now all face a levy of over €3/kg, doubling the price of cheaper cuts such as burger mince.
Meat Industry Ireland on Tuesday estimated the cost at €750m per annum.
Minister for Agriculture Michael Creed has pledged that he will seek emergency support from Brussels to compensate Irish farmers for the losses they are facing.
However, it gets worse.
The Irish Farmers Journal can reveal that when Michael Gove and trade secretary Liam Fox present their plans to cabinet for approval today (Wednesday), they will propose a massive tariff-free quota for beef, one that will account for most, if not all, of the British import demand.
This will have the effect of cutting supermarket beef prices, at the expense of their own farmers.
Irish exporters will still be competing on a level playing pitch with Brazilian product in what effectively would be a tariff-free environment. In this scenario, the value of Irish beef prices will fall by hundreds of millions of euro, but it will probably be harder to get compensation from Brussels for the losses the regime will impose.
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