Post-Brexit trade deals with Australia and NZ could flood the UK market with cheap imports which threaten domestic production, says Mike Hedges, Swansea East AM and member of the CCERA committee.
As we start the year when the United Kingdom leaves the EU, there is concern within the farming community about continuing support for farmers.
With only 7 per cent of the population vegetarian and 1 per cent vegan, the vast majority of the population are meat eaters, and many like me try and buy Welsh produce at every opportunity.
The EU currently provides direct payments to farmers to ensure they have a safety net.
They are mainly granted in the form of basic income support, decoupled from production, and are designed to stabilise income stemming from sales on the markets, which is subject to volatility.
In short, they ensure the continued production of food.
The EU is the biggest market for Welsh red meat, other than the UK, with approximately 90 per cent of Welsh beef and lamb exports destined for EU member states in 2016.
On 8 October 2018, the National Assembly’s External Affairs and Additional Legislation (EAAL) Committee held an evidence session as part of its inquiries into different sectors’ preparedness for Brexit, including food.
The Chief Executive of Hybu Cig Cymru (HCC), Gwynn Howells, described the European market for Welsh red meat as ‘extremely, extremely important’.
He also warned the industry is currently seeing some EU supply chains looking for alternatives to Welsh lamb, which he described as ‘unsettling’.
Whilst listening to the radio on my way to the Royal Welsh show in 2017, I was amazed to hear a sheep farmer welcome our withdrawal from the EU because he could now export his lamb to New Zealand.
Regarding UK sheep meat products, despite exporting most of its sheep meat products to the EU, the UK is the biggest EU exporter of sheep meat to non-EU countries.
To improve access to non-EU markets for Welsh lamb, HCC has invested resources in exploring options, particularly in the Middle East, Asia and the US.
Gwynn Howells said HCC is planning to accelerate development of markets outside of Europe ‘over the next few years in order to de-risk our portfolio of exports, which is largely in the European basket at the moment’.
The difficulty with exporting to the Middle East and Asia is that Australia and New Zealand are much closer than the UK and likely to supply at a much lower cost.
And a free trade agreement where we open Britain’s borders to overseas producers such as New Zealand and Australia could have a serious effect by flooding the market with cheap imports.
Many supermarkets charge less for New Zealand lamb, and that is after it has travelled from the southern hemisphere, due to the fact that this meat tends to be mass produced, bought in bulk and is generally cheaper to produce.
Mike can be found tweeting at @MikeHedgesAM